THIRD DIVISION March 8, 1996 within which to file compliance with the resolution of February 9, 1996 which directed
h to file compliance with the resolution of February 9, 1996 which directed him to show cause,
[A.M. No. MTJ-95-1063. August 9, 1996.]
ALFONSO C. CHOA, complainant, vs. JUDGE ROBERTO S. CHIONGSON, respondent.
Raymundo A. Quiroz for complainant.
SYLLABUS
1. LEGAL ETHICS; LAWYER; HIS RESPONSIBILITY TO HIS CLIENTS; MUST BE DONE WITHIN THE
BOUNDS OF REASON AND COMMON SENSE. — While a lawyer owes absolute fidelity to the cause of his client, full
devotion to his genuine interest, and warm zeal in the maintenance and defense of his rights, as well as the exertion of his
utmost learning and ability, he must do so only within the bounds of the law. He must give a candid and honest opinion on
the merits and probable results of his client's case with the end in view of promoting respect for the law and legal processes,
and counsel or maintain such actions or proceedings only as appear to him to be just, and such defenses only as he believes
to be honestly debatable under the law. He must always remind himself of the oath he took upon admission to the Bar that
he "will not wittingly or willingly promote or sue any groundless, false or unlawful suit nor give aid nor consent to the
same"; and that he "will conduct [himself] as a lawyer according to the best of [his] knowledge and discretion with all good
fidelity as well to the courts as to [his] clients." Needless to state, the lawyer's fidelity to his client must not be pursued at
the expenses of truth and the administration of justice, and it must be done within the bounds of reason and common sense.
A lawyer's responsibility to protect and advance the interests of his client does not warrant a course of action propelled by
ill motives and malicious intentions against the other party. As an officer of the court and its indispensable partner in the
sacred task of administering justice, graver responsibility is imposed upon a lawyer than any other to uphold the integrity
of the courts and to show respect to its officers.
2. ID.; ID.; HIS RIGHT TO CRITICIZE THE COURTS; MUST BE EXERCISED RESPONSIBLY. — It does
not however, follow that just because a lawyer is an officer of the court, he cannot criticize the courts. That is his right as a
citizen, and it is even his duty as an officer of the court to avail of such right. Nevertheless, such a right is not without limit.
The right to criticize, which is, guaranteed by the freedom of speech and of expression in the Bill of Rights of the
Constitution, must be exercised responsibly, for every right carries with it a corresponding obligation. Freedom is not
freedom from responsibility, but freedom with responsibility. Any criticism against a judge made in the guise of an
administrative complaint which is clearly unfounded and impelled by ulterior motive will not excuse the lawyer responsible
therefor under his duty of fidelity to his client. As we stated in Ng vs. Alfaro, 238 SCRA 486, 491-492 [1994], lawyers, as
officers of the court, should not encourage groundless administrative cases against court officers and employees. The time
of the latter should not be wasted in answering or defending groundless complaints; every minute of it is precious and must
be reserved for the enhancement of public service. Our precious time too should not be diverted to such cases.
RESOLUTION
DAVIDE, JR., J : p
In the resolution of 9 February 1996, this Court dismissed the instant complaint for want of merit and directed
Atty. Raymundo A. Quiroz, counsel for the complainant, to show cause within fifteen days from notice why he should not
be disciplinary dealt with for his apparent failure to comply with the duties and responsibilities of a member of the Bar.
Such duties and responsibilities were noted in the following paragraph of the resolution:
Atty. Raymundo A. Quiroz, counsel for the complainant, must have been aware of the utter lack of merit of
the charges against the respondent. As a Member of the Philippine Bar he is bound: (1) by his oath, not to, wittingly or
willingly, promote or sue any groundless, false, or unlawful suit nor give aid nor consent to the same; (2) by Section
20(c), Rule 138 of the Rules of Court, to counsel or maintain such actions or proceedings only as appear to him to be
just; and (3) to uphold the Code of Professional Responsibility. It was incumbent upon him to give a candid and honest
opinion on the merits and probable results of the complainant's case (Rule 15.05, Canon 15, Code of Professional
Responsibility) with the end in view of promoting respect for the law and legal processes (Canon 1, Id.). He should,
therefore, be required to show cause why no disciplinary action should be taken against him for his apparent failure to
observe the foregoing duties and responsibilities.
Atty. Quiroz received a copy of the foregoing resolution on 16 February 1996, and on 2 March 1996, he filed a
Motion for Extension of Time wherein he prayed that he be given an extension of six days from 2 March 1996 — the expiry
date of the original period to file his compliance to the show-cause order — within which to file his compliance to or motion
for reconsideration of the resolution.
In the resolution of 25 March 1996, this Court granted Atty. Quiroz's motion but only insofar as the filing of his
compliance was concerned, as clearly shown in the notice of the resolution sent to him reading as follows:
Quoted hereunder, for your information, is a resolution of the Third Division of this Court dated MAR. 25, 1996:
Administrative Matter MTJ-95-1063 (Alfonso C. Choa vs. Judge Roberto S. Chiongson, etc.) — The first
motion of Atty. Raymundo A. Quiroz, counsel for complainant, for extension of six (6) days form March 2, 1996 or until
why he should not be disciplinary dealt with for his apparent failure to comply with his duties and responsibilities, is
GRANTED, with WARNING that no further extension will be given.
It appears that on 8 March 1996 Atty. Quiroz filed with the Office of the Court Administrator a pleading
entitled Compliance/Motion for Reconsideration. This pleading is more of a motion for reconsideration. It was filed on the
last day of the period he solicited in his motion for extension. Since the resolution of 25 March 1996 granted only an
extension of the period to submit his compliance, it necessarily follows that the motion for reconsideration was filed beyond
the reglementary period. It bears stressing that paragraph 5 of this Court's en banc resolution of 7 April 1988 provides that,
as a general policy, no motion for extension of time to file a motion reconsideration shall be granted after the Court has
rendered its judgment. Accordingly, the motion for reconsideration must forthwith be DENIED for having been filed late.
In any event, it has no merit whatsoever except, perhaps, as to its sophistry.
The only issue then left is the sufficiency and adequacy of his explanation which is, nevertheless, inexorably
linked to the motion for reconsideration. Atty. Quiroz asserts that he never had the intention to prosecute or sue any
groundless, false, or unlawful suit or to file the instant complaint in addition to the appeal or in lieu thereof; that he assisted
the complainant in the honest belief that the latter has really a cause of action against the respondent; and that he "was not
ventilating in the instant case the complainant's grievances relative to the respondent's judgment finding [the complainant]
guilty of perjury but was only raising the matter to show that indeed the respondent was biased because of such next-door-
neighbor relationship."
These explanations deserve scant consideration. The claim of "honest belief," which amounts to a claim of good
faith, fails to convince us in light of what follows.
Nothing is further from the truth than the claim of Atty. Quiroz that he "was not ventilating in the instant case the
complainant's grievances relative to the respondent's judgment finding [the complainant] guilty of perjury but was only
raising the matter to show that indeed the respondent was biased because of such next-door-neighbor relationship." He was
in fact, attacking the judgment of conviction by asserting that the trial court's only recourse was to acquit the complainant
because (a) the allegations in the information do not constitute the offense of perjury; (b) the complainant's petition for
naturalization, which was the basis for the charge of perjury, having been withdrawn with finality, had become functus
officio, i.e., as if the petition was not filed at all, and, therefore, whatever false statement contained therein was no longer
required by law and had ceased to be on a material matter; (c) the respondent had admitted in evidence exhibits which are
obviously inadmissible; and (d) the respondent had sentenced the complainant with the penalty higher than that provided
by law without applying the Indeterminate Sentence Law.
The upshot of these allegations is that the complainant's (Mr. Choa's) conviction of the crime of perjury is baseless
or unfounded in law and in fact and is nothing but the product of the respondent's prejudice against Mr. Choa because the
respondent happens to be a "next-door neighbor" of Mr. Choa's wife, the private complainant in the perjury case.
Considering that Mr. Choa seasonably appealed from the judgment of conviction. Atty. Quiroz knew or ought to know that
all the matters which he may find relevant or material for the reversal of the judgment and the consequent acquittal of his
client, Mr. Choa, may be raised with the appellate court, and that this Court, not being the venue for such appeal, cannot
resolve the appeal even by way of an administrative complaint against the judge who convicted Mr. Choa.
If Atty. Quiroz then assisted Mr. Choa in the preparation of this case, he had nothing in mind but to harass the
respondent Judge and to unduly influence the course of the appeal in the criminal case by injecting into the mind of the
appellate judge that, indeed, something was definitely wrong with the appealed decision because the ponente thereof is now
facing a serious administrative complaint arising from his improper conduct therein. It might even be said that the filing of
this case was to send a signal to the appellate judge in the criminal case that an affirmance of the challenged decision would
clearly be erroneous, if not equally baseless and unfounded as that of the trial court below.
While a lawyer owes absolute fidelity to the cause of his client, full devotion to his genuine interest, and warm
zeal in the maintenance and defense of his rights, as well as the exertion of his utmost learning and ability, 1 he must do so
only within the bounds of the law. 2 He must give a candid and honest opinion on the merits and probable results of his
client's case 3 with the end in view of promoting respect for the law and legal processes, 4 and counsel or maintain such
actions or proceedings only as appear to him to be just, and such defenses only as he believes to be honestly debatable under
the law. 5 He must always remind himself of the oath he took upon admission to the Bar that he "will not wittingly or
willingly promote or sue any groundless, false or unlawful suit nor give aid nor consent to the same"; and that he "will
conduct [himself] as a lawyer according to the best of [his] knowledge and discretion with all good fidelity as well to the
courts as to [his] clients." Needless to state, the lawyer's fidelity to his client must not be pursued at the expense of truth and
the administration of justice, 6 and it must be done within the bounds of reason and common sense. 7 A lawyer's
responsibility to protect and advance the interests of his client does not warrant a course of action propelled by ill motives
and malicious intentions against the other party. 8
As an officer of the court and its indispensable partner in the sacred task of administering justice, graver
responsibility is imposed upon a lawyer than any other to uphold the integrity of the courts and to show respect to its officers.
This does not mean, however, that a lawyer cannot criticize a judge. As we stated in Tiongco vs. Hon. Aguilar: 9
It does not, however, follow that just because a lawyer is an officer of the court, he cannot criticize the courts. That
THIRD DIVISION
is his right as a citizen, and it is even his duty as an officer of the court to avail of such right. Thus, in In Re: Almacen (31 SCRA
[G.R. No. 117438. June 8, 1995.]
562, 579-580 [1970]), this Court explicitly declared: RAUL SESBREÑO, petitioner, vs. HON. COURT OF APPEALS, and PATRICIO GIAN, SOTERO
Hence, as a citizen and as officer of the court, a lawyer is expected not only to exercise the right, but also to consider
BRANZUELA, ANDRES C. YPIL, SANTIAGO BACAYO, BRIGIDO COHITMINGAO, VICTORINO
it his duty to avail of such right. No law may abridge this right. Nor is he "professionally answerable to a scrutiny into the
DINOY, GUILLERMO MONTEJO and EMILIO RETUBADO, respondents.
official conduct of the judges, which would not expose him to legal animadversion as a citizen." (Case of Austin, 28 Am
Dec. 657, 665). SYLLABUS
Above all others, the members of the bar have the best opportunity to become conversant with the character and 1. LEGAL AND JUDICIAL ETHICS; ATTORNEY'S FEES; ALWAYS SUBJECT TO JUDICIAL
CONTROL; REASON THEREFOR. — It is a settled rule that what a lawyer may charge and receive as attorney's fees
efficiency of our judges. No class is less likely to abuse the privilege, or no other class has as great an interest in the
preservation of an able upright bench. (State Board of Examiners in Law vs. Hart, 116 N.W. 212, 216). is always subject to judicial control. A lawyer is primarily an officer of the court charged with the duty of assisting the
To curtail the right of a lawyer to be critical of the foibles of the courts and judges is to seal the lips of those in the
court in administering impartial justice between the parties. When he takes his oath, he submits himself to the authority
best position to give advice and who might consider it their duty to speak disparagingly. "Under such a rule," so far as the
of the court and subjects his professional fees to judicial control. As stated by the Court in the case of Sumaong v.
bar is concerned, "the merits of a sitting judge may be rehearsed, but as to his demerits there must be profound silence."
Judge (G. R. No. 78173, October 26, 1993, 215 SCRA 136): "A lawyer is not merely the defender of his client's cause and a
(State vs. Circuit Court [72 N.W. 196]).
Nevertheless, such a right is not without limit. For, as this Court warned in Almacen: trustee of his client in respect of the client's cause of action and assets; he is also, and first and foremost, an officer of
the court and participates in the fundamental function of administering justice in society. It follows that a lawyer's
But it is a cardinal condition of all such criticism that it shall be bona fide, and shall not spill over the walls of decency
compensation for professional services rendered are subject to the supervision of the court, not just to guarantee that
and propriety. A wide chasm exists between fair criticism, on the one hand, and abuse and slander of courts and the judges
the fees he charges and receives remain reasonable and commensurate with the services rendered, but also to maintain
thereof, on the other. Intemperate and unfair criticism is a gross violation of the duty of respect to courts. It is such a
misconduct, that subjects a lawyer to disciplinary action. the dignity and integrity of the legal profession to which he belongs. Upon taking his attorney's oath as an officer of
xxx xxx xxx the court, a lawyer submits himself to the authority of the courts to regulate his right to professional fees."
The lawyer's duty to render respectful subordination to the courts is essential to the orderly administration of justice.2. ID.; ID.; CONTRACT STIPULATING THE AMOUNT THEREOF, ALLOWED; EXCEPTION. — In
Hence, in the assertion of their clients' rights, lawyers — even those gifted with superior intellect — are enjoined to rein
the case at bench, the parties entered into a contingent fee contract. A stipulation on a lawyer's compensation in a
up their tempers.
written contract for professional services ordinarily controls the amount of fees that the contracting lawyer may be
Elsewise stated, the right to criticize, which is guaranteed by the freedom of speech and of expression in the Bill of
allowed, unless the court finds such stipulated amount unreasonable or unconscionable.
Rights of the Constitution, must be exercised responsibly, for every rights carries with it a corresponding obligation. Freedom is
not freedom from responsibility, but freedom with responsibility. In Zaldivar vs. Gonzales (166 SCRA 316, 353-354 [1988]), it 3. ID.; ID.; CONTINGENT FEE AGREEMENT; MUST BE LAID DOWN IN AN EXPRESS CONTRACT
was held: TO BE VALID AND BINDING. — A contingent fee arrangement is valid in this jurisdiction and is generally
Respondent Gonzales is entitled to the constitutional guarantee of free speech. No one seeks to deny him that right, lest
recognized as valid and binding but must be laid down in an express contract. The amount of contingent fees agreed
of all this Court. What respondent seems unaware of is that freedom of speech and of expression, like all constitutional
upon by the parties is subject to the stipulation that counsel will be paid for his legal services only if the suit or litigation
freedoms, is not absolute and that freedom of expression needs an occasion to be adjusted to and accommodated with the
prospers. A much higher compensation is allowed as contingent fees in consideration of the risk that the lawyer may
requirements of equally important public interests. One of these fundamental public interests is the maintenance of the
get nothing if the suit fails.
integrity and orderly functioning of the administration of justice. There is no antimor between free expression and the
integrity of the system of administering justice. For the protection and maintenance of freedom of expression itself can be 4. ID.; ID.; ID.; ID.; SHALL BE UNDER THE SUPERVISION AND CLOSE SCRUTINY OF THE
COURT IN ORDER THAT CLIENT MAY BE PROTECTED FROM UNJUST CHARGES. — Contingent fee
secured only within the context of a functioning an orderly system of dispensing justice, within the context, in other words,
of viable independent institutions for delivery of justice which are accepted by the general community. contracts are under the supervision and close scrutiny of the court in order that clients may be protected from unjust
charges. Its validity depends in large measure on the reasonableness of the stipulated fees under the circumstances of
Proscribed then are, inter alia, the use of unnecessary language which jeopardizes high esteem in courts, creates or
promotes distrust a judicial administration (Rheem, supra), or tends necessarily to undermine the confidence of people in
each case. When the courts find that the stipulated amount is excessive or the contract is unreasonable or
the integrity of the members of this Court and to degrade the administration of justice by this Court (In re: Sotto, 82 Phil.
unconscionable, or found to have been marred by fraud, mistake, undue influence or suppression of facts on the part
595 [1949]); or of offensive and abusive language (In re: Rafael Climaco, 55 SCRA 107 [1974]) or abrasive and offensive
of the attorney, public policy demands that said contract be disregarded to protect the client from unreasonable
language (Yangson vs. Salandanan, 68 SCRA 42 [1975]; or of disrespectful, offensive, manifestly baseless, and malicious
exaction.
statement in pleadings or in a letter addressed to the judge (Baja vs. Macandog, 158 SCRA [1988], citing the resolution of
19 January 1988 in Phil. Public Schools Teachers Association vs. Quisumbing, G.R. No. 76180, and Ceniza vs. Sebastian, 5. ID.; ID.; WHEN DEEMED UNCONSCIONABLE. — Stipulated attorney's fees are unconscionable
130 SCRA 295 [1984]); or of disparaging, intemperate, and uncalled-for remarks (Sangalangvs. Intermediate Appellatewhenever the amount is by far so disproportionate compared to the value of the services rendered as to amount to fraud
Court, 177 SCRA 87 [1989]. perpetrated upon the client. This means to say that the amount of the fee contracted for, standing alone and unexplained
Any criticism against a judge made in the guise of an administrative complaint which is clearly unfounded and would be sufficient to show that an unfair advantage had been taken of the client, or that a legal fraud had been
impelled by ulterior motive will not excuse the lawyer responsible therefor under his duty of fidelity to his client. As we perpetrated on him. The decree of unconscionability or unreasonability or unreasonableness of a stipulated amount in
stated in Ng vs. Alfaro, 10 lawyers, as officers of the court, should not encourage groundless administrative cases against a contingent fee contract, will not however, preclude recovery. It merely justifies the court's fixing a reasonable amount
court officers and employees. The time of the latter should not be wasted in answering or defending groundless complaints; for the lawyer's services.
every minute of it is precious and must be reserved for the enhancement of public service. Our precious time too should not 6. ID.; ID.; ID.; CASE AT BAR, A CASE OF. — There is nothing irregular about the respondent court's
be diverted to such cases. finding that the 50% fee of petitioner is unconscionable. As aptly put by the court: "It effectively deprives the appellees
We find the explanation of Atty. Quiroz to be unsatisfactory. of a meaningful victory of the suit they have passionately pursued. Balancing the allocation of the monetary award,
WHEREFORE, we hereby impose upon ATTY. RAYMUNDO A. QUIROZ a FINE in the amount of Five 50% of all monies to the lawyer and the other 50% to be allocated among all his 52 clients, is too lop-sided in favor of
Thousand Pesos (P5,000.00) to be paid within five (5) days from notice hereof. He is further WARNED that a commission the lawyer. The ratio makes the practice of law a commercial venture, rather than a noble profession. . . . Also, the 52
of the same or similar acts in the future shall be dealt with more severely. employees who are the plaintiffs in the aforementioned civil case were dismissed from employment, their means of
 livelihood. All 52 hired claimant-appellant as counsel so that they could be reinstated and their source of income
restored. It would, verily be ironic if the counsel whom they had hired to help would appropriate for himself 50% or
even 60% of the total amount collectible by these employees. Here is an instance where the courts should
intervene." Considering the nature of the case, which is a labor case, the amount recovered and petitioner's participation
in the case, an award of 50% of back salaries of his 52 clients indeed strikes us an excessive. Under the circumstances,
a fee of 20% of back salaries would be a fair settlement in this case. In any event, this award pertains only to the ten
private respondents herein. Petitioner has already been compensated in the amount of 50% of all monies received, by
the rest of his clients in the case below.
7. ID.; ID.; FACTORS TO CONSIDER IN DETERMINING THEREOF IN THE ABSENCE OF A
CONTRACT. — Courts may always ascertain, if the attorney's fees are found to be excessive, what is reasonable under
the circumstances. Quantum meruit, meaning "as much as he deserves," is used as the basis for determining the lawyer's
professional fees in the absence of a contract. Factors such as the time spent and extent of services rendered; novelty
and difficulty of the questions involved; importance of the subject matter; skill demanded; probability of losing other
employment as a result of acceptance of the proffered cause; customary charges for similar services; amount involved
in the controversy and the benefits resulting to the client; certainty of compensation; character of employment; and
professional standing of the lawyer, are considered in determining his fees.
DECISION
ROMERO, J : p
Of interest to all law practitioners is the issue at bench, namely, whether the Court of Appeals had the
authority to reduce the amount of attorney's fees awarded to petitioner Atty. Raul H. Sesbreño, notwithstanding the
contract for professional services signed by private respondents.
The antecedents facts of the case follow.
Fifty-two employees sued the Province of Cebu and then Governor Rene Espina for reinstatement and
backwages. 1 Herein petitioner, Raul H. Sesbreño, replaced the employees' former counsel Atty. Catalino Pacquiao.
Thirty-two of the fifty-two employees signed two documents whereby the former agreed to pay petitioner
30% as attorney's fees and 20% as expenses to be taken from their back salaries.
On September 12, 1974, the trial court rendered a decision ordering the Province of Cebu to reinstate the
petitioning employees and pay them back salaries. Said decision became final and executory after it was affirmed in
toto by the Court of Appeals and the petition to review the appellate decision, denied by this Court in 1978. 2
A compromise agreement was entered into by the parties below in April 1979 whereby the former employees
waived their right to reinstatement among others. Likewise, pursuant to said compromise agreement, the Province of
Cebu released P2,300,000.00 to the petitioning employees through petitioner as "Partial Satisfaction of Judgment."
The amount represented back salaries, terminal leave pay and gratuity pay due to the employee.
Sometime November and December 1979, ten employees, herein private respondents, 3 filed manifestations
before the trial court asserting that they agreed to pay petitioner 40% to be taken only from their back salaries.
The lower court issued two orders, with which petitioner complied, requiring him to release P10,000.00 to
each of the ten private respondents and to retain 40% of the back salaries pertaining to the latter out of the
P2,300,000.00 released to him.
On March 28, 1980, the trial court fixed petitioner's attorney's fees at 40% of back salaries, terminal leave,
gratuity pay and retirement benefits and 20% as expenses, or a total of 60% of all monies paid to the employees.
Private respondent's motion for reconsideration was granted and on June 10, 1980, the trial court modified
the award after noting that petitioner's attorney's lien was inadvertently placed as 60% when it should have been only
50%. The dispositive portion of the order reads:
"WHEREFORE, in view of all the foregoing the order of this Court fixing 60% as attorney's fee[s] of
Atty. Sesbreño should be 50% of all monies which the petitioners (Suico, et. al.) may receive from the Provincial
Government."
Obviously not satisfied with the attorney's fees fixed by the trial court, petitioner appealed to the Court of
Appeals claiming additional fees for legal services before the Supreme Court, reimbursement for expenses and a clear
statement that the fee be likewise taken from retirement pay awarded to his clients. Unfortunately, the respondent
appellate court did not agree with him as the generous awards further reduced. 4
The appellate court noted that in this jurisdiction, attorney's fees are always subject to judicial control and
deemed the award of 20% of the back salaries awarded to private respondents as a fair, equitable and reasonable amount
of attorney's fee. The decretal portion of the decision reads:
"WHEREFORE, the questioned order is MODIFIED. The attorney's fees due Atty. Raul Sesbreño is
fixed at an amount equivalent to 20% of all back salaries which the Province of Cebu has awarded to herein 10
petitioners." 5
Hence this petition for review where he claims that attorney's fees amounting to 50% of all monies awarded
to his clients as contingent fees should be upheld for being consistent with prevailing case law and the contract of
professional services between the parties. He adds that since private respondents did not appeal, they are not entitled
to affirmative relief other than that granted in the regional trial court.
We find no reversible error in the decision of the Court of Appeals and vote to deny the petition.
Respondent court found that the contract of professional services entered into by the parties 6 authorized
petitioner to take a total of 50% from the employees' back salaries only. The trial court, however, fixed the lawyers fee
on the basis of all monies to be awarded to private respondents.
Fifty per cent of all monies which private respondents may receive from the provincial government,
according to the Court of Appeals, is excessive and unconscionable, not to say, contrary to the contract of professional
services. 7 After considering the facts and the nature of the case, as well as the length of time and effort exerted by
petitioner, respondent court reduced the amount of attorney's fees due him. cdrep
It is a settled rule that what a lawyer may charge and receive as attorney's fees is always subject to judicial
control. 8 A lawyer is primarily an officer of the court charged with the duty of assisting the court in administering
impartial justice between the parties. When he takes his oath, he submits himself to the authority of the court and
subjects his professional fees to judicial control. 9
As stated by the Court in the case of Sumaong v. Judge: 10
"A lawyer is not merely the defender of his client's cause and a trustee of his client in respect of the
client's cause of action and assets; he is also, and first and foremost, an officer of the court and participates in the
fundamental function of administering justice in society. It follows that a lawyer's compensation for professional
services rendered are subject to the supervision of the court, not just to guarantee that the fees he charges and
receives remain reasonable and commensurate with the services rendered, but also to maintain the dignity and
integrity of the legal profession to which he belongs. Upon taking his attorney's oath as an officer of the court, a
lawyer submits himself to the authority of the courts to regulate his right to professional fees." 11
In the case at bench, the parties entered into a contingent fee contract. The agreement provides:
"WE, the undersigned petitioners in the case of POLICRONIO BELACHO, ET AL., VS. RENE
ESPINA ET AL., hereby agree to pay Atty. Sesbreño, our lawyer, the following to be taken from our back salaries:
30% as attorney's fees
20% as expenses
That we enter into agreement in order to be paid our back salaries as early as possible and so that we
may be reinstated as early as possible."
A stipulation on a lawyer's compensation in a written contract for professional services ordinarily controls
the amount of fees that the contracting lawyer may be allowed, unless the court finds such stipulated amount
unreasonable or unconscionable. 12
A contingent fee arrangement is valid in this jurisdiction 13 and is generally recognized as valid and binding
but must be laid down in an express contract. 14 The amount of contingent fees agreed upon by the parties is subject to
the stipulation that counsel will be paid for his legal services only if the suit or litigation prospers. A much higher
compensation is allowed as contingent fees in consideration of the risk that the lawyer may get nothing if the suit fails.
Contingent fee contracts are under the supervision and close scrutiny of the court in order that clients may
be protected from unjust charges. 15 Its validity depends in large measure on the reasonableness of the stipulated fees
under the circumstances of each case. 16
When the courts find that the stipulated amount is excessive or the contract is unreasonable or
unconscionable, or found to have been marred by fraud, mistake, undue influence or suppression of facts on the part
of the attorney, public policy demands that said contract be disregarded to protect the client from unreasonable
exaction. 17
Stipulated attorney's fees are unconscionable whenever the amount is by far so disproportionate compared
to the value of the services rendered as to amount to fraud perpetrated upon the client. This means to say that the
amount of the fee contracted for, standing alone and unexplained would be sufficient to show that an unfair advantage
had been taken of the client, or that a legal fraud had been perpetrated on him. 18
The decree of unconscionability or unreasonability or unreasonableness of a stipulated amount in a
contingent fee contract, will not however, preclude recovery. It merely justifies the court's fixing a reasonable amount
for the lawyer's services. llcd
 Courts may always ascertain, if the attorney's fees are found to be excessive, what is reasonable under the
circumstances. Quantum meruit, meaning "as much as he deserves," is used as the basis for determining the lawyer's
professional fees in the absence of a contract. Factors such as the time spent and extent of services rendered; novelty
and difficulty of the questions involved; importance of the subject matter; skill demanded; probability of losing other
employment as a result of acceptance of the proffered cause; customary charges for similar services; amount involved
in the controversy and the benefits resulting to the client; certainty of compensation; character of employment; and
professional standing of the lawyer, are considered in determining his fees. 19
There is nothing irregular about the respondent court's finding that the 50% fee of petitioner is
unconscionable. As aptly put by the court:
"It effectively deprives the appellees of a meaningful victory of the suit they have passionately pursued.
Balancing the allocation of the monetary award, 50% of all monies to the lawyer and the other 50% to be allocated
among all his 52 clients, is too lop-sided in favor of the lawyer. The ratio makes the practice of law a commercial
venture, rather than a noble profession.
. . . Also, the 52 employees who are the plaintiffs in the aforementioned civil case were dismissed from
employment, their means of livelihood. All 52 hired claimant-appellant as counsel so that they could be reinstated
and their source of income restored. It would, verily be ironic if the counsel whom they had hired to help would
appropriate for himself 50% or even 60% of the total amount collectible by these employees. Here is an instance
where the courts should intervene." 20
Considering the nature of the case, which is a labor case, the amount recovered and petitioner's participation
in the case, an award of 50% of back salaries of his 52 clients indeed strikes us an excessive. Under the circumstances,
a fee of 20% of back salaries would be a fair settlement in this case. In any event, this award pertains only to the ten
private respondents herein. Petitioner has already been compensated in the amount of 50% of all monies received, by
the rest of his clients in the case below.
WHEREFORE, in view of the foregoing, the petition is DENIED and the appealed decision AFFIRMED.
FIRST DIVISION
[G.R. No. 160334. September 11, 2006.]
GUENTER BACH, petitioner, vs. ONGKIKO KALAW MANHIT & ACORDA LAW OFFICES, respondent.
DECISION
CHICO-NAZARIO, J : p
This Petition for Review on Certiorari seeks to reverse the Decision 1 dated 8 October 2003 of the Court of
Appeals in CA-G.R. CV No. 74445, entitled, "Ongkiko Kalaw Manhit & Accorda Law Offices v. Guenter Bach."
The facts as culled from the records of the case are as follows:
On 7 November 1994, petitioner Guenter Bach engaged the services of respondent law firm Ongkiko Kalaw
Manhit & Accorda Law Offices to represent him in a Petition for Declaration of Nullity of Marriage filed before the Regional
Trial Court (RTC) of Makati City, Branch 143, docketed as Civil Case No. 95-224. The parties signed a "Fee Agreement,"
for the legal services to be rendered by respondent. The provision for payment of the legal services reads:
(a) seven and one-half (7 1/2%) of all cash recoveries, including damages, interests, attorney's fees and petitioner prays for reduction of the same.
costs; as well as
(b) five percent (5%) of the market value of all properties awarded to [the petitioner] by the court or
obtained through the compromise agreement, valued at the time of recovery. 2
However, on 5 December 1995, respondent withdrew its appearance as counsel of petitioner, due to policy
differences. On 18 December 1995, respondent sent the termination billing 3 for the services they rendered and billed
petitioner the total amount of P1,000,000.00 plus 2% interest for every month of delay in payment, based on the provision
for termination of services stated in their Fee Agreement, thus:
(C) Interest for late payment
All fees mentioned herein are payable within seven (7) days from receipt of our statement of account.
It is understood that all late payments shall be subject to interest payment at the rate of 2% per month of delay, a
fraction of a month being considered as one month, counted from the date the fees shall fall due, without need of
prior demand.
xxx xxx xxx
(F) Termination Clause
It is understood that you may terminate our services at any time. In such an event, we shall be entitled
to collect fees for legal services already performed and results obtained based on quantum meruit." 4
On 7 March 1996, respondent filed with the RTC a Notices 5 of Charging Lien over the properties of the spouses
Bach. CHDaAE
On 5 February 1997, the RTC issued an Order 6 directing the annotation of the charging lien in the amount of
P1,000,000.00 on all the titles of the spouses Bach's personal and real properties enumerated in the notice of charging lien.
On 11 February 1999, respondent received a copy of the Order 7 dated 8 June 1998, granting petitioner's Motion
to Withdraw his petition in Civil Case No. 95-224.
Despite respondent's demands for his legal fees, petitioner failed and refused to pay. Thus, respondent filed a
Complaint 8 for a sum of money also before the RTC of Makati, Branch 148, docketed as Civil Case No. 99-514. Respondent
prayed for the payment of the following: P1,000,000.00 as the latter's lawful fees for services rendered in Civil Case No.
95-224, plus 2% interest from date of final demand until paid; P250,000.00 as exemplary damages; P200,000.00
representing billable time spent in prosecuting the case, plus another P150,000.00 for any appeal taken; and P50,000.00 as
litigation expenses and the cost of suit.
Within the period for filing an Answer, petitioner filed a Motion 9 to dismiss on the ground that respondent's claim
had already been paid, waived, abandoned or otherwise extinguished. Petitioner contended that prior to respondent's
withdrawal as counsel in Civil Case No. 95-224, petitioner had already paid respondent's services in the total amount of
P200,000.00. On 9 August 1999, the Motion to Dismiss was denied 10 by the RTC for lack of merit. Petitioner failed to file
his Answer; thus, he was declared in default and respondent was allowed to present its evidence ex parte. 11
On 24 January 2002, the RTC rendered its judgment in favor of the respondent, the dispositive portion of which
reads:
WHEREFORE, premises considered, judgment is hereby rendered in favor of the plaintiff and against the defendant
and the latter is hereby ordered to pay the following:
1. The amount of P750,000.00 as plaintiff's lawful fees for services rendered under Civil Case No. 95-224, plus
interest at the rate of 2% per month from the date of demand until paid;
2. P700,000.00 representing billable time which was spent in prosecuting this case;
3. P50,000.00 as and litigation expenses, and
4. Costs of suit. 12
Not satisfied, petitioner appealed to the Court of Appeals, which modified the RTC Decision, thus:
WHEREFORE, Based on the foregoing premises, the instant appeal is PARTLY GRANTED and the
appealed January 24, 2002 Decision of the Regional Trial Court of Makati City-Branch 148 in Civil Case No. 99-
514 is hereby MODIFIED. Accordingly, the award of P700,000.00 representing billable time allegedly spent in
the prosecution of the case a quo is hereby DELETED. All other aspects of the appealed DECISION are
UPHELD. 13
Hence, this Petition filed by petitioner Guenter Bach raising the following issues to wit:
WHETHER OR NOT UNDER THE CONCEPT OF QUANTUM MERUIT, THE AMOUNT OF
P750,000.00 AS FEES FOR SERVICES RENDERED WITH INTEREST PEGGED AT 2% A MONTH FROM
DATE OF DEMAND UNTIL FULLY PAID IS REASONABLE
WHETHER OR NOT THERE IS LEGAL BASIS TO AWARD P50,000.00 AS AND FOR
LITIGATION EXPENSES AND COSTS OF SUIT. 14
On the first issue, petitioner contends that the P750,000.00 awarded to the respondent by way of quantum meruit,
with interest of 2% a month from date of demand until fully paid, is excessive, unreasonable and confiscatory. Thus,
Both the Court of Appeals and the trial court approved the attorney's fees in the total amounts of P750,000.00 plus
2% interest for the services rendered by respondent in Civil Case No. 95-224. In this regard, the rule is that the issue of the
reasonableness of attorney's fees based on quantum meruit is a question of fact, and well-settled is the rule that conclusions
and findings of fact by the lower courts are entitled to great weight on appeal and will not be disturbed except for strong
and cogent reasons. The findings of the Court of Appeals by itself, which are supported by substantial evidence, are almost
beyond the power of review by the Supreme Court. 15 Thus, in the exercise of the Supreme Court's power of review the
findings of facts of the Court of Appeals are conclusive and binding on the Supreme Court. There are, however, recognized
exceptions to this rule, namely: (1) when the findings are grounded entirely on speculation, surmises or conjectures; (2)
when the inference made is manifestly mistaken, absurd or impossible; (3) when there is grave abuse of discretion; (4) when
the judgment is based on misapprehension of facts; (5) when the findings of facts are conflicting; (6) when in making the
findings the Court of Appeals went beyond the issues of the case, or its findings are contrary to the admissions of both the
appellee and the appellant; (7) when the findings are contrary to the trial court; (8) when the findings are conclusions without
citation of specific evidence on which they are based; (9) when the facts set forth in the petition as well as in the petitioner's
main and reply briefs are not disputed by the respondent; (10) when the findings of facts are premised on the supposed
absence of evidence and contradicted by the evidence on record; and (11) when the Court of Appeals manifestly overlooked
certain relevant facts not disputed by the parties, which if properly considered, would justify a different
conclusion. 16 Exceptions (4) and (11) are present in the case at bar, and so this Court shall make its own determination of
the facts relevant for the resolution of the case.
Ordinarily, therefore, we would have remanded this case for further reception of evidence as to the extent and
value of the services rendered by respondent to petitioner. However, so as not to needlessly prolong the resolution of a
comparatively simple controversy, we deem it just and equitable to fix in the present recourse a reasonable amount of
attorney's fees in favor of respondent. SHTEaA
There are two concepts of attorney's fees. In the ordinary sense, attorney's fees represent the reasonable
compensation paid to a lawyer by his client for the legal services rendered to the latter. On the other hand, in its extraordinary
concept, attorney's fees may be awarded by the court as indemnity for damages to be paid by the losing party to the prevailing
party. 17
The issue in this case concerns attorney's fees in the ordinary concept. Generally, the amount of attorney's fees
due is that stipulated in the retainer agreement which is conclusive as to the amount of the lawyer's compensation. In the
absence thereof, the amount of attorney's fees is fixed on the basis of quantum meruit, i.e., the reasonable worth of the
attorney's services. Courts may ascertain also if the attorney's fees are found to be excessive, what is reasonable under the
circumstances.18 In no case, however, must a lawyer be allowed to recover more than what is reasonable, pursuant to Section
24, Rule 138 of the Rules of Court, which provides:
SEC. 24. Compensation of attorney's fees; agreement as to fees. — An attorney shall be entitled to have and recover
from his client no more than a reasonable compensation for his services, with a view to the importance of the subject — matter
of the controversy, the extent of the services rendered, and the professional standing of the attorney. No court shall be bound by
the opinion of attorneys as expert witnesses as to the proper compensation, but may disregard such testimony and base its
conclusion on its own professional knowledge. A written contract for services shall control the amount to be paid therefor
unless found by the court to be unconscionable or unreasonable. (Underscoring supplied.)
We have identified the circumstances to be considered in determining the reasonableness of a claim for attorney's (UCPB) account in the name of petitioner's wife, Luzviminda Bach, containing about P6,500,000.00, representing the
fees as follows: (1) the amount and character of the service rendered; (2) labor, time, and trouble involved; (3) the nature balance of the proceeds from the sale of their conjugal property in Pasig City;
6. Respondent worked on the annotation of a notice of lis pendens on the property of Spouses Bach in Dasmariñas,
Cavite, covered by TCT No. T-380848, thereby preventing disposition of the property by Luzviminda Bach;
7. Respondent annotated a notice 25 of lis pendens on the property of Spouses Bach situated in Tagaytay City,
covered by TCT No. P-705, thereby preventing disposition of the property by Luzviminda Bach;
8. Respondent filed the Petition 26 for Declaration of Nullity of Marriage and Dissolution of the Conjugal
Partnership of Gains of petitioner with his wife;
9. Respondent prepared an affidavit 27 in favor of petitioner attesting to the fact of petitioner's marriage and their
properties acquired during his marriage with Luzviminda Bach;
10. Respondent prepared an ex parte motion 28 to declare petitioner's wife to have waived her right to file answer
for failure to file the same within the period granted by law and to direct the public prosecutor to determine whether or not
a collusion exist;
11. Respondent prepared a Petition 29 for appointment of a receiver and to compel petitioner's wife to render an
accounting;
12. Other services included the filling of several oppositions 30 to certain motions filed by petitioner's wife;
13. Respondent filed a motion 31 to set the case for preliminary investigation;
14. Respondent filed an ex parte motion 32 to declare petitioner's wife in default;
15. Respondent submitted a supplemental comment 33 on the motion for leave to withdraw funds from Certificate
of Participation filed by petitioner's wife;
16. Respondent filed a manifestation and motion 34 praying the court to direct petitioner's wife to designate her
lead counsel in the case;
17. Respondent prepared a Reply 35 to comments on opposition of petitioner;
18. Respondent was able to secure an Order 36 from the said court freezing the United Coconut Planters Bank
AcDHCS

and importance of the litigation or business in which the services were rendered; (4) the responsibility imposed; (5) the 19. Respondent represented petitioner in numerous hearings in Civil Case No. 95-224, evidenced by the signatures
amount of money or the value of the property affected by the controversy or involved in the employment; (6) the skill and of the lawyers of respondent Law Firm in the minutes dated 25 April 1995, 27 April, 1995, 14 June 1995, 27 June 1995, 1
experience called for in the performance of the services; (7) the professional character and social standing of the attorney; August 1995, 11 August 1995, 22 September 1995, 10 October 1995, 17 October 1995, 1 December 1995, 7 December
(8) the results secured; and (9) whether the fee is absolute or contingent, it being recognized that an attorney may properly 1995, 29 March 1996 and 16 January 1997; 37
charge a much larger fee when it is contingent than when it is not. 19 20. Conducted several preliminary and post litigation conferences in the proceedings for preliminary injunction
Rule 20.1, Canon 20 of the Code of Professional Responsibility enumerates the following factors which should leading to the freezing of the bank account of the parties; and
guide a lawyer in determining his fees: 21. Prepared and sent out numerous letters to third parties and entities to protect the interest of petitioner and
(a) the time spent and extent of services rendered or required; notices to petitioner updating him of the status of the case and the courses of action taken by respondent Law Firm. 38
(b) the novelty and difficulty of the questions involved; In sum, the services rendered by the respondent as enumerated above and as admitted 39 by Atty. Mario Ongkiko
(c) the importance of the subject matter; during the ex parte hearing, consist of annotating notice of lis pendens on the conjugal properties of petitioner and his wife;
(d) the skill demanded; filing the Petition for Declaration of Nullity of Marriage; preparing and filing various pleadings and documents relevant to
(e) the probability of losing other employment as a result of the acceptance of the proffered case; the case; obtaining a freeze order of petitioner's funds in the UCPB; attending hearings in Civil Case No. 05-224, and
(f) the customary charges for similar services and the schedule of fees of the IBP Chapter to which he belongs;
sending notices to petitioner updating the latter of the status of the case. Nothing in Civil Case No. 95-224 so far appears
(g) the amount involved in the controversy and the benefits resulting to the client from the service;
(h) the contingency or certainty of compensation; complicated and no extra ordinary skill was needed for lawyers of respondent Law Firm to accomplish what they had done
(i) the character of the employment, whether occasional or established; and in the case before they withdrew their appearance. We do not find herein a situation so intricate that demands more than a
(j) the professional standing of the lawyer. careful scrutiny of the legal matters involved. These are simply the normal duties of a lawyer that he is bound by law to
In determining a reasonable fee to be paid to respondent as compensation for their services on quantum meruit, render to his clients with utmost fidelity for which his client must not be burdened to pay an extra price. It bears stressing
based on the factors abovequoted, it is proper to consider all the facts and circumstances obtaining in this case. that at the time respondent firm withdrew their appearance due to policy differences with petitioner, the case was still in its
It is undisputed that respondent firm had rendered services as counsel for the petitioners in Civil Case No. 95- initial stage.
244. The services rendered consist of the following: Guided by the above yardstick and so much of the pertinent data as are extant in the records of this case and in
1. Respondent was able to annotate a notice 20 of lis pendens on the property of Spouses Bach in Caloocan City the exercise of our sound discretion, we hold that the amount of P500,000.00 is a reasonable and fair compensation for the
covered by TCT No. C-12112, thereby preventing easy disposition of the property by Luzviminda Bach; legal services rendered by respondent to the petitioner.
2. Respondent was likewise able to annotate a notice 21 of lis pendens on the property of Spouses Bach in Pasig The imposition of legal interest on the amount payable to private respondent as attorney's fees is unwarranted.
City covered by TCT No. 48223, thereby preventing disposition of the property by Luzviminda Bach; Even as we agree that parties can freely stipulate on the terms of payment, still the imposition of interest in the payment of
3. Further, respondent annotated a notice 22 of lis pendens on the property of Spouses Bach in Dasmarinas, Cavite attorney's fees is not justified. In the case of Cortes v. Court of Appeals, 40 we ruled that Article 2209 41 of the Civil Code
covered by TCT No. T-339282, thereby preventing disposition of the property by Luzviminda Bach; does not even justify the imposition of legal interest on the payment of attorney's fees as it is a provision of law governing
4. Additionally, respondent annotated a notice 23 of lis pendens on the property of Spouses Bach in Tanza, Cavite, ordinary obligations and contracts. It deleted the 6% interest imposed by the appellate court on the payment of attorney's
covered by TCT No. T-255263, thereby preventing disposition of the property by Luzviminda Bach; fees. It ratiocinated by citing Mambulao Lumber Co. v. Philippine National Bank, 42 thus:
5. Respondent also worked on the annotation of the notice 24 of lis pendens on the property of Spouses Bach in Contracts for attorney's services in this jurisdiction stands upon an entirely different footing
Makati, covered by TCT No. S-62541, thereby preventing disposition of the property by Luzviminda Bach; from contracts for the payment of compensation for any other services. . . . [A]n attorney is not entitled in
 the absence of express contract to recover more than a reasonable compensation for his services; and even when directly by the Supreme Court. The Court shall base its final action on the case on the report and recommendation submitted
an express contract is made, the court can ignore it and limit the recovery to reasonable compensation if the by the investigating official and the evidence presented by the parties during the investigation.
amount of the stipulated fee is found by the court to be unreasonable. This is a very different rule from that 2. ID.; ID.; ID.; ONLY PENDING CASES, THE INVESTIGATION OF WHICH HAS NOT BEEN SUBSTANTIALLY
announced in section 1091 of the Civil Code with reference to the obligation of contracts in general, where it is
COMPLETED BY THE SOLICITOR GENERAL SHALL BE TRANSFERRED TO THE IBP. — There is no need to refer
said that such obligation has the force of law between the contracting parties. Had the plaintiff herein made an
express contract to pay his attorney an uncontingent fee of P2,115.25 for the services to be rendered in reducing the case to the IBP since at the time of the effectivity of Rule 139-B [June 1, 1988] the investigation conducted by the Office
the note here in suit to judgment, it would not have been enforced against him had he seen fit to oppose it, as such of the Solicitor General had been substantially completed. Section 20 of Rule 139-B provides that only pending cases, the
a fee is obviously far greater than is necessary to remunerate the attorney for the work involved and is therefore investigation of which has not been substantially completed by the Office of the Solicitor General, shall be transferred to
unreasonable. In order to enable the court to ignore an express contract for attorney's fees, it is necessary to the IBP. In this case the investigation by the Solicitor General was terminated even before the effectivity of Rule 139-B.
show, as in other contracts, that it is contrary to morality or public policy (Art. 1255, Civil Code). It is Respondent himself admitted in his motion to dismiss that the Solicitor General terminated the investigation on November
enough that it is unreasonable or unconscionable. (Emphases supplied.) 26, 1986, the date when respondent submitted his reply memorandum [Motion to Dismiss, p. 1; Record, p. 353]
We have held that lawyering is not a moneymaking venture and lawyers are not merchants. 43 Law advocacy, it 3. ID.; ID.; ID.; REFERRAL OF CASE WHERE THE SOLICITOR GENERAL HAS ALREADY MADE A THOROUGH
has been stressed, is not capital that yields profits. The returns it births are simple rewards for a job done or service rendered. INVESTIGATION RESULTS IN DUPLICATION OF THE PROCEEDINGS AND DELAY. — There is no need for
It is a calling that, unlike mercantile pursuits which enjoy a greater deal of freedom from governmental interference, is further investigation since the Office of the Solicitor General already made a thorough and comprehensive investigation of
impressed with a public interest, for which it is subject to State regulation. 44 the case. To refer the case to the IBP, as prayed for by the respondent, will result not only in duplication of the proceedings
conducted by the Solicitor General but also to further delay in the disposition of the present case which has lasted for more
A lawyer is not merely the defender of his client's cause and a trustee of his client's cause of action and assets; he than thirteen (13) years.
is also, and first and foremost, an officer of the court and participates in the fundamental function of administering justice 4. CONSTITUTIONAL LAW; BILL OF RIGHTS; DUE PROCESS; NO DENIAL OF, WHERE RESPONDENT WAS
in society. 45 It follows that a lawyer's compensation for professional services rendered are subject to the supervision of the GIVEN AMPLE OPPORTUNITY TO PRESENT EVIDENCE. — Respondent's assertion that he still has some evidence
court, not just to guarantee that the fees he charges and receives remain reasonable and commensurate with the services to present does not warrant the referral of the case to the IBP. Considering that in the investigation conducted by the Solicitor
rendered, but also to maintain the dignity and integrity of the legal profession to which he belongs. Upon taking his attorney's General respondent was given ample opportunity to present evidence, his failure to adduce additional evidence is entirely
oath as an officer of the court, a lawyer submits himself to the authority of the courts to regulate his right to charge his own fault. There was therefore no denial of procedural due process. The record shows that respondent appeared as
professional fees. 46 witness for himself and presented no less than eleven (11) documents to support his contentions. He was also allowed to
Though we reduced the award of attorney's fees and disallowed the imposition of interest thereon, the fact that an cross-examine the complainant who appeared as a witness against him.
attorney plays a vital role in the administration of justice underscores the need to secure to him his honorarium lawfully 5. CIVIL LAW; SALES; CAPACITY TO BUY; LAWYER IS PROHIBITED FROM ACQUIRING HIS CLIENT'S
earned as a means to preserve the decorum and respectability of the legal profession. A lawyer is as much entitled to judicial PROPERTY OR INTEREST IN LITIGATION WHICH HE MAY TAKE PART. — The record shows that respondent
protection against injustice, imposition of fraud on the part of his client as the client against abuse on the part of his counsel. prepared a document entitled "Transfer of Rights" which was signed by on August 31, 1971. The document assigned to
The duty of the court is not alone to see that a lawyer acts in a proper and lawful manner; it is also its duty to see that a respondent one-half (1/2) of the properties of the Fortunados covered by TCT No. T-1929, with an area of 239.650 sq. m.,
lawyer is paid his just fees. With his capital consisting only of his brains and with his skill acquired at tremendous cost not and TCT No. T-3041, with an area of 72.907 sq. m., for and in consideration of his legal services to the latter. At the time
only in money but in expenditure of time and energy, he is entitled to the protection of any judicial tribunal against any the document was executed, respondent knew that the abovementioned properties were the subject of a civil case [Civil
attempt on the part of his client to escape payment of his just compensation. It would be ironic if after putting forth the best Case No. Q-15143] pending before the Court of First Instance of Quezon City since he was acting as counsel for the
in him to secure justice for his client, he himself would not get his due. 47 Fortunados in said case [See Annex "B" of Original Complaint, p. 12; Rollo, p. 16]. In executing the document transferring
Thus, the Court of Appeals did not err in awarding expenses of litigation. Article 2208, paragraphs 2, 5 and 11, one-half (1/2) of the subject properties to himself, respondent violated the law expressly prohibiting a lawyer from acquiring
of the Civil Code, authorize the recovery of such fees "(2) When the defendant's act or omission has compelled the plaintiff his client's property or interest involved in any litigation in which he may take part by virtue of his profession [Article 1491,
to litigate . . . or to incur expenses to protect his interest; . . . (5) Where the defendant acted in gross and evident bad faith New Civil Code].
in refusing to satisfy the plaintiff's plainly valid, just and demandable claim; . . . and (11) In any other case where the court 6. LEGAL ETHICS; DISBARMENT AND SUSPENSION; PURCHASE BY A LAWYER OF CLIENT'S PROPERTY
deems it just and equitable that attorney's fees and expenses of litigation should be recovered." Considering the fact that OR INTEREST IN LITIGATION IS A BRANCH OF PROFESSIONAL ETHICS AND CONSTITUTES
respondent was drawn into this litigation by petitioner to protect and defend their interest and taking into account the services MALPRACTICE. — This Court has held that the purchase by a lawyer of his client's property or interest in litigation is a
already rendered by respondent to petitioner, the sum of P30,000.00 as expenses of litigation and cost of suit would be breach of professional ethics and constitutes malpractice [Hernandez v. Villanueva, 40 Phil. 774 (1920); Go Beltran v.
reasonable under the premises. Fernandez, 70 Phil. 248 (1940)].
WHEREFORE, the Decision appealed from is AFFIRMED WITH MODIFICATIONS to the effect that the 7. ID.; ID.; TRANSGRESSION OF ANY LAW BY A LAWYER IS A REPULSIVE AND REPREHENSIBLE ACT. —
attorney's fees awarded to respondent is REDUCED to P500,000.00, the legal interest of 2% on the amount due to The very first Canon of the new Code states that "a lawyer shall uphold the Constitution, obey the laws of the land and
respondent is DELETED, and the award of litigation expenses is REDUCED to P30,000.00. TSacAE

promote respect for law and legal process". Moreover, Rule 138, Sec. 3 of the Revised Rules of Court requires every lawyer
EN BANC to take an oath to "obey the laws [of the Republic of the Philippines] as well as the legal orders of the duly constituted
[A.M. No. 1625. February 12, 1990.] authorities therein." And for any violation of this oath, a lawyer may be suspended or disbarred by the Supreme Court [Rule
ANGEL L. BAUTISTA, complainant, vs. ATTY. RAMON A. GONZALES, respondent. 138, Sec. 27, Revised Rules of Court]. All of these underscore the role of the lawyer as the vanguard of our legal system.
SYLLABUS The transgression of any provision of law by a lawyer is a repulsive and reprehensible act which the Court will not
1. LEGAL ETHICS; DISBARMENT AND SUSPENSION OF ATTORNEYS; REFERENCE TO THE IBP OF countenance. In the instant case, respondent, having violated Art. 1491 of the Civil Code, must be held accountable both to
COMPLAINTS AGAINST LAWYERS IS NOT MANDATORY; CASES MAY BE REFERRED TO THE SOLICITOR his client and to society.
GENERAL. — Contrary to respondent's claim, reference to the IBP of complaints against lawyers is not mandatory upon 8. ID.; ID.; NOTWITHSTANDING THE ABSENCE OF PROVISION PROHIBITING PURCHASE OF CLIENT'S
the Court [Zaldivar v. Sandiganbayan, G.R. Nos. 79690-707; Zaldivar v. Gonzales, G.R. No. 80578, October 7, 1988]. PROPERTY AND INTEREST, A DISCIPLINARY ACTION MAY BE BROUGHT AGAINST LAWYER. — It should
Reference of complaints to the IBP is not an exclusive procedure under the terms of Rule 139-B of the Revised Rules of be noted that the persons mentioned in Art. 1491 of the Civil Code are prohibited from purchasing the property mentioned
Court [Ibid]. Under Sections 13 and 14 of Rule 139-B, the Supreme Court may conduct disciplinary proceedings without therein because of their existing trust relationship with the latter. A lawyer is disqualified from acquiring by purchase the
the intervention of the IBP by referring cases for investigation to the Solicitor General or to any officer of the Supreme property and rights in litigation because of his fiduciary relationship with such property and rights, as well as with the client.
Court or judge of a lower court. In such a case, the report and recommendation of the investigating official shall be reviewed And it cannot be claimed that the new Code of Professional Responsibility has failed to emphasize the nature and
consequences of such relationship. Canon 17 states that "a lawyer owes fidelity to the cause of his client and he shall be him, respondent filed on June 19, 1976 a motion for a bill of particulars asking this Court to order complainant to amend
mindful of the trust and confidence reposed in him." On the other hand, Canon 16 provides that "a lawyer shall hold in trust his complaint by making his charges more definite. In a resolution dated June 28, 1976, the Court granted respondent's
all moneys and properties of his client that may come into his possession." Hence, notwithstanding the absence of a specific motion and required complainant to file an amended complaint. On July 15, 1976, complainant submitted an amended
provision on the matter in the new Code, the Court, considering the abovequoted provisions of the new Code in relation to complaint for disbarment, alleging that respondent committed the following acts:
Art. 1491 of the Civil Code, as well as the prevailing jurisprudence, holds that the purchase by a lawyer of his client's 1. Accepting a case wherein he agreed with his clients, namely, Alfaro Fortunado, Nestor Fortunado and Editha Fortunado
property in litigation constitutes a breach of professional ethics for which a disciplinary action may be brought against him.[hereinafter referred to as the Fortunados] to pay all expenses, including court fees, for a contingent fee of fifty percent
9. ID.; ID.; A LAWYER SHOULD OBSERVE HONESTY AND FAIRNESS EVEN IN PRIVATE DEALINGS. — (50%) of the value of the property in litigation.
Another misconduct committed by respondent was his failure to disclose to complainant, at the time the land development 2. Acting as counsel for the Fortunados in Civil Case No. Q-15143, wherein Eusebio Lopez, Jr. is one of the defendants
agreement was entered into, that the land covered by TCT No. T-1929 had already been sold at a public auction. The land and, without said case being terminated, acting as counsel for Eusebio Lopez, Jr. in Civil Case No. Q-15490;
development agreement was executed on August 31, 1977 while the public auction was held on June 30, 1971. Respondent 3. Transferring to himself one-half of the properties of the Fortunados, which properties are the subject of the litigation in
failed to live up to the rigorous standards of ethics of the law profession which place a premium on honesty and condemn Civil Case No. Q-15143, while the case was still pending;
duplicitous conduct. The fact that complainant was not a former client of respondent does not exempt respondent from his 4. Inducing complainant, who was his former client, to enter into a contract with him on August 30, 1971 for the
duty to inform complainant of an important fact pertaining to the land which is subject of their negotiation. Since he was a development into a residential subdivision of the land involved in Civil Case No. Q-15143, covered by TCT No. T-1929,
party to the land development agreement, respondent should have warned the complainant of the sale of the land at a public claiming that he acquired fifty percent (50%) interest thereof as attorney's fees from the Fortunados, while knowing fully
auction so that the latter could make a proper assessment of the viability of the project they were jointly undertaking. This well that the said property was already sold at a public auction on June 30, 1971, by the Provincial Sheriff of Lanao del
Court has held that a lawyer should observe honesty and fairness even in his private dealings and failure to do so is a groundNorte and registered with the Register of Deeds of Iligan City;
for disciplinary action against him [Custodio v. Esto, Adm. Case No. 1113, February 22, 1978, 81 SCRA 517]. 5. Submitting to the Court of First Instance of Quezon City falsified documents purporting to be true copies of "Addendum
10. ID.; ID.; A LAWYER SHOULD NEVER SEEK TO MISLEAD THE COURT BY AN ARTIFICE OR FALSE to the Land Development Agreement dated August 30, 1971" and submitting the same document to the Fiscal's Office of
STATEMENT OF FACT. — When respondent submitted the alleged true copy of the addendum on May 23, 1973 as Annex Quezon City, in connection with the complaint for estafa filed by respondent against complainant designated as I.S. No.
"A" of his Manifestation filed with the Court of First Instance of Quezon City, he knowingly misled the Court into believing 7512936;
that the original addendum was signed by Edith Fortunado and Nestor Fortunado. Such conduct constitutes willful disregard 6. Committing acts of treachery and disloyalty to complainant who was his client;
of his solemn duty as a lawyer to act at all times in a manner consistent with the truth. A lawyer should never seek to mislead
7. Harassing the complainant by filing several complaints without legal basis before the Court of First Instance and the
the court by an artifice or false statement of fact or law [Section 20 (d), Rule 138, Revised Rules of Court; Canon 22, CanonsFiscal's Office of Quezon City;
of Professional Ethics; Canon 10, Rule 10.01, Code of Professional Responsibility]. 8. Deliberately misleading the Court of First Instance and the Fiscal's Office by making false assertion of facts in his
11. ID.; ID.; AN AGREEMENT WHEREBY AN ATTORNEY AGREES TO PAY EXPENSES OF PROCEEDINGS IS pleadings;
CHAMPERTOUS. — The Court, finds that the agreement between the respondent and the Fortunados, which provides in 9. Filing petitions "cleverly prepared (so) that while he does not intentionally tell a lie, he does not tell the truth either."
part that: [the Fortunados] agree on the 50% contingent fee, provided, [respondent Ramon Gonzales] defray all expenses, Respondent filed an answer on September 29, 1976 and an amended answer on November 18, 1976, denying the accusations
for the suit, including court fees . . . is contrary to Canon 42 of the Canons of Professional Ethics which provides that a against him. Complainant filed a reply to respondent's answer on December 29, 1976 and on March 24, 1977 respondent
lawyer may not properly agree with a client to pay or bear the expenses of litigation. [See also Rule 16.04, Code of filed a rejoinder. prLL

Professional Responsibility]. Although a lawyer may in good faith, advance the expenses of litigation, the same should be In a resolution dated March 16, 1983, the Court referred the case to the Office of the Solicitor General for investigation,
subject to reimbursement. The agreement between respondent and the Fortunados, however, does not provide for report and recommendation. In the investigation conducted by the Solicitor General, complainant presented himself as a
reimbursement to respondent of litigation expenses paid by him. An agreement whereby an attorney agrees to pay expenses witness and submitted Exhibits "A" to "PP', while respondent appeared both as witness and counsel and submitted Exhibits
of proceedings to enforce the client's rights is champertous [JBP Holding Corp. v. U.S. 166 F. Supp. 324 (1958)]. Such "1" to "11". The parties were required to submit their respective memoranda.
agreements are against public policy especially where, as in this case, the attorney has agreed to carry on the action at his On May 16, 1988 respondent filed a motion to dismiss the complaint against him, claiming that the long delay in the
own expense in consideration of some bargain to have part of the thing in dispute [See Sampliner v. Motion Pictures Patents resolution of the complaint against him constitutes a violation of his constitutional right to due process and speedy
Co., et al., 255 F. 242 (1918)]. The execution of these contracts violates the fiduciary relationship between the lawyer and disposition of cases. Upon order of the Court, the Solicitor General filed a comment to the motion to dismiss on August 8,
his client, for which the former must incur administrative sanctions. 1988, explaining that the delay in the investigation of the case was due to the "numerous requests for postponement of
scheduled hearings filed by both parties and the motions for extension of time to file their respective memoranda."
12. ID.; ID.; RULE AGAINST REPRESENTATION OF CONFLICTING INTEREST; EXCEPTION. — One of the [Comment of the Solicitor General, p. 2; Record, p. 365]. Respondent filed a reply to the Solicitor General's comment on
recognized exceptions to the rule against representation of conflicting interests is where the clients knowingly consent to October 26, 1988. In a resolution dated January 16, 1989 the Court required the Solicitor General to submit his report and
the dual representation after full disclosure of the facts by counsel [Canon 6, Canons of Professional Ethics; Canon 15, Rule recommendation within thirty (30) days from notice.
15.03, Code of Professional Responsibility]. On April 11, 1989, the Solicitor General submitted his report with the recommendation that Atty. Ramon A. Gonzales be
13. ID.; ID.; FOR FAILING TO LIVE UP TO THE STANDARDS EXPECTED OF A MEMBER OF THE BAR, suspended for six (6) months. The Solicitor General found that respondent committed the following acts of misconduct:
LAWYER IS SUSPENDED FROM PRACTICE OF LAW. — The Court finds clearly established in this case that on four a. transferring to himself one-half of the properties of his clients during the pendency of the case where the
counts the respondent violated the law and the rules governing the conduct of a member of the legal profession. Sworn to properties were involved;
assist in the administration of justice and to uphold the rule of law, he has "miserably failed to live up to the standards b. concealing from complainant the fact that the property subject of their land development agreement had already
been sold at a public auction prior to the execution of said agreement; and
expected of a member of the Bar." [Artiaga v. Villanueva, Adm. Matter No. 1892, July 29, 1988, 163 SCRA 638, 647]. The
c. misleading the court by submitting alleged true copies of a document where two signatories who had not signed
Court agrees with the Solicitor General that, considering the nature of the offenses committed by respondent and the facts the original (or even the xerox copy) were made to appear as having fixed their signatures [Report and
and circumstances of the case, respondent lawyer should be suspended from the practice of law for a period of six (6) Recommendation of the Solicitor General, pp. 17-18; Rollo, pp. 403-404].
months. Respondent then filed on April 14, 1989 a motion to refer the case to the Integrated Bar of the Philippines (IBP) for
RESOLUTION investigation and disposition pursuant to Rule 139-B of the Revised Rules of Court. Respondent manifested that he intends
PER CURIAM : p

to submit more evidence before the IBP. Finally, on November 27, 1989, respondent filed a supplemental motion to refer
In a verified complaint filed by Angel L. Bautista on May 19, 1976, respondent Ramon A. Gonzales was charged with this case to the IBP, containing additional arguments to bolster his contentions in his previous pleadings.
malpractice, deceit, gross misconduct and violation of lawyer's oath. Required by this Court to answer the charges against I.
Preliminarily, the Court will dispose of the procedural issue raised by respondent. It is respondent's contention that the
preliminary investigation conducted by the Solicitor General was limited to the determination of whether or not there is
sufficient ground to proceed with the case and that under Rule 139 the Solicitor General still has to file an administrative
complaint against him. Respondent claims that the case should be referred to the IBP since Section 20 of Rule 139-B
provides that:
This Rule shall take effect on June 1, 1988 and shall supersede the present Rule 139 entitled "DISBARMENT OR
SUSPENSION OF ATTORNEYS." All cases pending investigation by the Office of the Solicitor General shall be transferred
to the Integrated Bar of the Philippines Board of Governors for investigation and disposition as provided in this Rule except underscore the role of the lawyer as the vanguard of our legal system. The transgression of any provision of law by a lawyer
those cases where the investigation has been substantially completed.
The above contention of respondent is untenable. In the first place, contrary to respondent's claim, reference to the IBP of
complaints against lawyers is not mandatory upon the Court [Zaldivar v. Sandiganbayan, G.R. Nos. 79690-707; Zaldivar
v. Gonzales, G.R. No. 80578, October 7, 1988]. Reference of complaints to the IBP is not an exclusive procedure under the
terms of Rule 139-B of the Revised Rules of Court [Ibid]. Under Sections 13 and 14 of Rule 139-B, the Supreme Court may
conduct disciplinary proceedings without the intervention of the IBP by referring cases for investigation to the Solicitor
General or to any officer of the Supreme Court or judge of a lower court. In such a case, the report and recommendation of
the investigating official shall be reviewed directly by the Supreme Court. The Court shall base its final action on the case
on the report and recommendation submitted by the investigating official and the evidence presented by the parties during
the investigation.
Secondly, there is no need to refer the case to the IBP since at the time of the effectivity of Rule 139-B [June 1, 1988] the
investigation conducted by the Office of the Solicitor General had been substantially completed. Section 20 of Rule 139-B
provides that only pending cases, the investigation of which has not been substantially completed by the Office of the
Solicitor General, shall be transferred to the IBP. In this case the investigation by the Solicitor General was terminated even
before the effectivity of Rule 139-B. Respondent himself admitted in his motion to dismiss that the Solicitor General
terminated the investigation on November 26, 1986, the date when respondent submitted his reply memorandum [Motion
to Dismiss, p. 1; Record, p. 353].
Thirdly, there is no need for further investigation since the Office of the Solicitor General already made a thorough and
comprehensive investigation of the case. To refer the case to the IBP, as prayed for by the respondent, will result not only
in duplication of the proceedings conducted by the Solicitor General but also to further delay in the disposition of the present
case which has lasted for more than thirteen (13) years.
Respondent's assertion that he still has some evidence to present does not warrant the referral of the case to the IBP.
Considering that in the investigation conducted by the Solicitor General respondent was given ample opportunity to present
evidence, his failure to adduce additional evidence is entirely his own fault. There was therefore no denial of procedural due
process. The record shows that respondent appeared as witness for himself and presented no less than eleven (11) documents
to support his contentions. He was also allowed to cross-examine the complainant who appeared as a witness against him.
II.
The Court will now address the substantive issue of whether or not respondent committed the acts of misconduct alleged by
complainant Bautista.
After a careful review of the record of the case and the report and recommendation of the Solicitor General, the Court finds
that respondent committed acts of misconduct which warrant the exercise by this Court of its disciplinary power. cdrep
The record shows that respondent prepared a document entitled "Transfer of Rights" which was signed by the Fortunados
on August 31, 1971. The document assigned to respondent one-half (1/2) of the properties of the Fortunados covered by
TCT No. T-1929, with an area of 239.650 sq. m., and TCT No. T-3041, with an area of 72.907 sq. m., for and in
consideration of his legal services to the latter. At the time the document was executed, respondent knew that the
abovementioned properties were the subject of a civil case [Civil Case No. Q-15143] pending before the Court of First
Instance of Quezon City since he was acting as counsel for the Fortunados in said case [See Annex "B" of Original
Complaint, p. 12; Rollo, p. 16]. In executing the document transferring one-half (1/2) of the subject properties to himself,
respondent violated the law expressly prohibiting a lawyer from acquiring his client's property or interest involved in any
litigation in which he may take part by virtue of his profession [Article 1491, New Civil Code]. This Court has held that the
purchase by a lawyer of his client's property or interest in litigation is a breach of professional ethics and constitutes
malpractice [Hernandez v. Villanueva, 40 Phil. 774 (1920); Go Beltran v. Fernandez, 70 Phil. 248 (1940)].
However, respondent notes that Canon 10 of the old Canons of Professional Ethics, which states that "[t]he lawyer should
not purchase any interests in the subject matter of the litigation which he is conducting," does not appear anymore in the
new Code of Professional Responsibility. He therefore concludes that while a purchase by a lawyer of property in litigation
is void under Art. 1491 of the Civil Code, such purchase is no longer a ground for disciplinary action under the new Code
of Professional Responsibility.
This contention is without merit. The very first Canon of the new Code states that "a lawyer shall uphold the
Constitution, obey the laws of the land and promote respect for law and legal process" (Emphasis supplied). Moreover, Rule
138, Sec. 3 of the Revised Rules of Court requires every lawyer to take an oath to "obey the laws [of the Republic of the
Philippines] as well as the legal orders of the duly constituted authorities therein." And for any violation of this oath, a
lawyer may be suspended or disbarred by the Supreme Court [Rule 138, Sec. 27, Revised Rules of Court]. All of these
is a repulsive and reprehensible act which the Court will not countenance. In the instant case, respondent, having violated
Art. 1491 of the Civil Code, must be held accountable both to his client and to society. prLL
Parenthetically, it should be noted that the persons mentioned in Art. 1491 of the Civil Code are prohibited from purchasing
the property mentioned therein because of their existing trust relationship with the latter. A lawyer is disqualified from
acquiring by purchase the property and rights in litigation because of his fiduciary relationship with such property and rights,
as well as with the client. And it cannot be claimed that the new Code of Professional Responsibility has failed to emphasize
the nature and consequences of such relationship. Canon 17 states that "a lawyer owes fidelity to the cause of his client and
he shall be mindful of the trust and confidence reposed in him." On the other hand, Canon 16 provides that "a lawyer shall
hold in trust all moneys and properties of his client that may come into his possession." Hence, notwithstanding the absence
of a specific provision on the matter in the new Code, the Court, considering the abovequoted provisions of the new Code
in relation to Art. 1491 of the Civil Code, as well as the prevailing jurisprudence, holds that the purchase by a lawyer of his
client's property in litigation constitutes a breach of professional ethics for which a disciplinary action may be brought
against him.
Respondent's next contention that the transfer of the properties was not really implemented, because the land development
agreement on which the transfer depended was later rescinded, is untenable. Nowhere is it provided in the Transfer of Rights
that the assignment of the properties of the Fortunados to respondent was subject to the implementation of the land
development agreement. The last paragraph of the Transfer of Rights provides that:
. . . for and in consideration of the legal services of ATTY. RAMON A. GONZALES, Filipino, married to Lilia
Yusay, and a resident of 23 Sunrise Hill, New Manila, Quezon City, rendered to our entire satisfaction, we hereby,
by these presents, do transfer and convey to the said ATTY. RAMON A. GONZALES, his heirs, successor, and
assigns, one-half (1/2) of our rights and interests in the above-described property, together with all the
improvements found therein [Annex "D" of the Complaint, Record, p. 28; Emphasis supplied].
It is clear from the foregoing that the parties intended the transfer of the properties to respondent to be absolute and
unconditional, and irrespective of whether or not the land development agreement was implemented.
Another misconduct committed by respondent was his failure to disclose to complainant, at the time the land development
agreement was entered into, that the land covered by TCT No. T-1929 had already been sold at a public auction. The land
development agreement was executed on August 31, 1977 while the public auction was held on June 30, 1971.
Respondent denies that complainant was his former client, claiming that his appearance for the complainant in an anti-graft
case filed by the latter against a certain Gilbert Teodoro was upon the request of complainant and was understood to be only
provisional. Respondent claims that since complainant was not his client, he had no duty to warn complainant of the fact
that the land involved in their land development agreement had been sold at a public auction. Moreover, the sale was duly
annotated at the back of TCT No. T-1929 and this, respondent argues, serves as constructive notice to complainant so that
there was no concealment on his part. cdll
The above contentions are unmeritorious. Even assuming that the certificate of sale was annotated at the back of TCT No.
T-1929, the fact remains that respondent failed to inform the complainant of the sale of the land to Samauna during the
negotiations for the land development agreement. In so doing, respondent failed to live up to the rigorous standards of ethics
of the law profession which place a premium on honesty and condemn duplicitous conduct. The fact that complainant was
not a former client of respondent does not exempt respondent from his duty to inform complainant of an important fact
pertaining to the land which is subject of their negotiation. Since he was a party to the land development agreement,
respondent should have warned the complainant of the sale of the land at a public auction so that the latter could make a
proper assessment of the viability of the project they were jointly undertaking. This Court has held that a lawyer should
observe honesty and fairness even in his private dealings and failure to do so is a ground for disciplinary action against him
[Custodio v. Esto, Adm. Case No. 1113, February 22, 1978, 81 SCRA 517].
Complainant also charges respondent with submitting to the court falsified documents purporting to be true copies of an
addendum to the land development agreement. LLpr
Based on evidence submitted by the parties, the Solicitor General found that in the document filed by respondent with the
Court of First Instance of Quezon City, the signatories to the addendum to the land development agreement — namely,
Ramon A. Gonzales, Alfaro T. Fortunado, Editha T. Fortunado, Nestor T. Fortunado, and Angel L. Bautista — were made
to appear as having signed the original document on December 9, 1972, as indicated by the letters "(SGD.)" before each of
their names. However, it was only respondent Alfaro Fortunado and complainant who signed the original and duplicate
original (Exh. "2") and the two other parties, Edith Fortunado and Nestor Fortunado, never did. Even respondent himself
admitted that Edith and Nestor Fortunado only signed the xerox copy (Exh. "2-A") after respondent wrote them on May 24,
that it was still pending resolution, the Solicitor General made no finding on complainant's claim that it was a mere ploy by
respondent to harass him. The determination of the validity of the complaint in Civil Case No. Q-18060 was left to the Court
of First Instance of Quezon City where the case was pending resolution.
The Court agrees with the above findings of the Solicitor General, and accordingly holds that there is no basis for holding
that the respondent's sole purpose in filing the aforementioned cases was to harass complainant.
Grounds 6, 8 and 9 alleged in the complaint need not be discussed separately since the above discussion on the other grounds
sufficiently cover these remaining grounds. Cdpr

1973, asking them to sign the said xerox copy attached to the letter and to send it back to him after signing [Rejoinder to The Court finds clearly established in this case that on four counts the respondent violated the law and the rules governing
Complainant's Reply, pp. 4-6; Rollo, pp. 327-329]. Moreover, respondent acknowledged that Edith and Nestor Fortunado the conduct of a member of the legal profession. Sworn to assist in the administration of justice and to uphold the rule of
had merely agreed by phone to sign, but had not actually signed, the alleged true copy of the addendum as of May 23, 1973 law, he has "miserably failed to live up to the standards expected of a member of the Bar." [Artiaga v. Villanueva, Adm.
[Respondent's Supplemental Motion to Refer this Case to the Integrated Bar of the Philippines, p. 16]. Thus, when Matter No. 1892, July 29, 1988, 163 SCRA 638, 647]. The Court agrees with the Solicitor General that, considering the
respondent submitted the alleged true copy of the addendum on May 23, 1973 as Annex "A" of his Manifestation filed with nature of the offenses committed by respondent and the facts and circumstances of the case, respondent lawyer should be
the Court of First Instance of Quezon City, he knowingly misled the Court into believing that the original addendum was suspended from the practice of law for a period of six (6) months.
signed by Edith Fortunado and Nestor Fortunado. Such conduct constitutes willful disregard of his solemn duty as a lawyer WHEREFORE, finding that respondent Attorney Ramon A. Gonzales committed serious misconduct, the Court Resolved
to act at all times in a manner consistent with the truth. A lawyer should never seek to mislead the court by an artifice or to SUSPEND respondent from the practice of law for SIX (6) months effective from the date of his receipt of this Resolution.
false statement of fact or law [Section 20 (d), Rule 138, Revised Rules of Court; Canon 22, Canons of Professional Let copies of this Resolution be circulated to all courts of the country for their information and guidance, and spread in the
Ethics; Canon 10, Rule 10.01, Code of Professional Responsibility]. personal record of Atty. Gonzales.
SECOND DIVISION
Anent the first charge of complainant, the Solicitor General found that no impropriety was committed by respondent in [G.R. No. 155311. March 31, 2004.]
entering into a contingent fee contract with the Fortunados [Report and Recommendation, p. 8; Record, p. 394]. The Court, DOY MERCANTILE, INC., petitioner, vs. AMA COMPUTER COLLEGE and ERNESTO
however, finds that the agreement between the respondent and the Fortunados, which provides in part that: RIOVEROS, respondents.
We [the Fortunados] agree on the 50% contingent fee, provided, you [respondent Ramon Gonzales] defray all RESOLUTION
expenses, for the suit, including court fees. TINGA, J : p

Alfaro T. Fortunado [signed] On June 1, 1990, petitioner Doy Mercantile, Inc. (DOY) through its then counsel, respondent Atty. Eduardo P.
Editha T. Fortunado [signed]
Gabriel, Jr., filed before the Regional Trial Court (RTC) of Cebu City a Complaint for Annulment of Contract, Damages
Nestor T. Fortunado [signed]
CONFORME with Preliminary Injunction against AMA Computer College, Inc. (AMA) and one Ernesto Rioveros.
Ramon A. Gonzales [signed] Petitioner alleged that it owns Lots 2-A and 2-B, and the improvements thereon, located at No. 640 Osmeña
[Annex "A" to the Complaint, Record, p. 4]. Boulevard, Cebu City, covered by Transfer Certificate of Title (TCT) Nos. 68951 and 68952. DOY assailed the Deed of
is contrary to Canon 42 of the Canons of Professional Ethics which provides that a lawyer may not properly agree Conditional Sale supposedly executed by one of DOY’s directors, Dionisio O. Yap, in favor of AMA. Dionisio allegedly
with a client to pay or bear the expenses of litigation. [See also Rule 16.04, Code of Professional Responsibility]. sold the properties to AMA without proper authorization from DOY’s Board of Directors. DOY also questioned the
Although a lawyer may in good faith, advance the expenses of litigation, the same should be subject to Secretary’s Certificate which was executed by DOY Corporate Secretary Francisco P. Yap, authorizing Dionisio to sell the
reimbursement. The agreement between respondent and the Fortunados, however, does not provide for properties and to sign the contract in behalf of DOY.
reimbursement to respondent of litigation expenses paid by him. An agreement whereby an attorney agrees to pay Through Atty. Gabriel, Jr., DOY filed an Urgent Ex Parte Motion for the Issuance of a Restraining Order, which
expenses of proceedings to enforce the client's rights is champertous [JBP Holding Corp. v. U.S. 166 F. Supp. 324 was granted by the RTC on June 14, 1990. On June 23, 1990, Atty. Gabriel also filed an Answer to Defendant’s
(1958)]. Such agreements are against public policy especially where, as in this case, the attorney has agreed to carry Counterclaim. On July 2, 1990, he filed DOY’s Formal Rejoinder to AMA’s Opposition for Issuance of Writ of Preliminary
on the action at his own expense in consideration of some bargain to have part of the thing in dispute [See Sampliner Injunction. He also filed on July 24, 1990, an Omnibus Motion seeking (1) the reconsideration of the order denying DOY’s
v. Motion Pictures Patents Co., et al., 255 F. 242 (1918)]. The execution of these contracts violates the fiduciary application for a writ of preliminary injunction, (2) the setting of the case for pre-trial and trial on the merits, and (3) the
relationship between the lawyer and his client, for which the former must incur administrative sanctions. imposition of disciplinary sanctions to Atty. Winston Garcia, who notarized the Deed of Conditional Sale and
The Solicitor General next concludes that respondent cannot be held liable for acting as counsel for Eusebio Lopez, Jr. in the Secretary's Certificate. On August 31, 1990, Atty. Gabriel also filed a Rejoinder to AMA’s Opposition to Motion for
Civil Case No. Q-15490 while acting as counsel for the Fortunados against the same Eusebio Lopez, Jr. in Civil Case No. Reconsideration, etc.
Q-15143. The Court, after considering the record, agrees with the Solicitor General's findings on the matter. The evidence During this period, that is, before pre-trial, DOY filed a Petition for Certiorari, Prohibition with a Prayer for a
presented by respondent shows that his acceptance of Civil Case No. Q-15490 was with the knowledge and consent of the Writ of Preliminary Injunction (CA-G.R. S.P. No. 22727) with the Court of Appeals. It questioned the Order of the RTC
Fortunados. The affidavit executed by the Fortunados on June 23, 1976 clearly states that they gave their consent when dated July 5, 1990, denying DOY's prayer for the issuance of a writ of preliminary injunction and dissolving the temporary
respondent accepted the case of Eusebio Lopez, Jr. [Affidavit of Fortunados, dated June 23, 1976; Rollo, p. 198]. One of restraining order previously issued. DOY also assailed the Order dated August 10, 1990, which denied DOY's Omnibus
the recognized exceptions to the rule against representation of conflicting interests is where the clients knowingly consent Motion. Atty. Gabriel, Jr., signed the petition together with Atty. Enrique C. Andres of the law firm of Salonga, Andres,
to the dual representation after full disclosure of the facts by counsel [Canon 6, Canons of Professional Ethics; Canon 15, Hernandez and Allado.
Rule 15.03, Code of Professional Responsibility]. During pre-trial, AMA proposed to enter into a compromise agreement with DOY, which proposal the parties
Complainant also claims that respondent filed several complaints against him before the Court of First Instance and the later agreed to adopt. The agreement was signed by Fernando Yap in behalf of DOY, with the assistance of Atty. Gabriel,
Fiscal's Office of Quezon City for the sole purpose of harassing him. Jr. and Atty. Andres. On November 29, 1990, a Judgment based on the compromise agreement was rendered by the RTC.
The record shows that at the time of the Solicitor General's investigation of this case, Civil Case No. Q-18060 was still In light of said compromise, the Court of Appeals dismissed CA-G.R. S.P. No. 22727 for mootness.
pending before the Court of First Instance of Quezon City, while the complaints for libel (I.S. No. 76-5912) and perjury DOY, however, refused to satisfy Atty. Gabriel, Jr.’s attorney’s fees, prompting the lawyer to file with the RTC
(I.S. No. 5913) were already dismissed by the City Fiscal for insufficiency of evidence and lack of interest, respectively a Motion to Allow Commensurate Fees and to Annotate Attorney’s Lien on T.C.T. Nos. 68951 and 68952. At this point,
[Report and Recommendation, pp. 16-17; Rollo, pp. 402-403]. The Solicitor General found no basis for holding that the DOY had already obtained the services of a new counsel to attend to the enforcement of theJudgment of the RTC.
complaints for libel and perjury were used by respondent to harass complainant. As to Civil Case No. Q-18060, considering
 On December 27, 1991, the RTC fixed Atty. Gabriel, Jr.'s fees at P200,000.00 and ordered that a lien be annotated
on the TCTs. A Writ of Execution was later issued by the trial court in Atty. Gabriel, Jr.’s favor.
Upon Atty. Gabriel Jr.'s motion for reconsideration, the RTC increased his fees to P500,000.00. It then issued
another Writ of Execution to enforce the new award but denied the Motion to Annotate the Award at the back of the TCTs.
DOY, for its part, filed several petitions with the Court of Appeals to set aside the RTC Orders involving the
award of attorney’s fees. Eventually, the Court of Appeals rendered a Decision, 1 fixing Atty. Gabriel, Jr.’s fees at
P200,000.00 and affirming the subsequent Order of the RTC not to annotate such award on the TCTs.
This Decision is now the subject of the present petition.
DOY contends that the Decision is not consistent with the guidelines prescribed by Section 24, Rule 138 2 of the
Rules of Court and Rule 20.01 3 of the Code of Professional Responsibility. DOY avers that except for the statement that
the compromise agreement benefited DOY and that Atty. Gabriel, Jr., was a competent lawyer, the Court of Appeals made
no pronouncement as to the importance of the subject matter in controversy, the extent of services rendered and the
professional standing of Atty. Gabriel, Jr., DOY also submits that the Court of Appeals should not have merely relied on
the value of the properties involved as the basis for its award. Furthermore, while Atty. Gabriel admitted that he already
received Eighty Two Thousand Nine Hundred Fifty Pesos (P82,950.00) from DOY for incidental and partial attorney’s fees,
a fact affirmed by the Court of Appeals, the latter still awarded P200,000.00 to him.
Atty. Gabriel, Jr., comments, however, that the attorney's fees awarded by the appellate court were commensurate
and, perhaps, even less than, the value of the services he rendered. He then enumerates the pleadings he drafted and the
appearances he made to dispose of the main case.
Atty. Gabriel, Jr., also alleges that he handled interrelated cases for DOY. He purportedly prepared and filed with
the Metropolitan Trial Court of Cebu City the following: a case for Illegal Detainer with Damages, an Opposition to Motion
to Dismiss, an Opposition to Defendant’s Motion for Reconsideration, and a Motion to Dismiss.
Atty. Gabriel, Jr., also draws attention to the criminal case filed by Rolando Piedad, director of AMA, before the
Office of the Cebu City Prosecutor charging Dionisio Yap and Francisco Yap with estafa through falsification of public
document. He claims that it was he who prepared and filed with said Office the Joint Affidavit of Messrs. Dionisio and
Francisco Yap against Rolando Piedad for Perjury, as well as the Yaps’ Counter-Affidavit in the criminal case. The case
was eventually dismissed by the fiscal.
Finally, Atty. Gabriel, Jr., stresses that, through his efforts and resourcefulness, AMA had no choice but to concede
to the compromise agreement resulting in the cancellation of the Deed of Conditional Sale between DOY and AMA.
According to him, AMA was operating a school on the property, which did not have an area of at least 1,000 square meters
as required of a school campus, in violation of the directives of the Department of Education, Culture and Sports (DECS).
AMA also did not have a business permit from the city government. Atty. Gabriel thus made formal representations with
the DECS and the City of Cebu, which ordered AMA to cease operations. Atty. Gabriel, Jr., also verified from the Philippine
National Bank whether AMA applied for a loan with which to pay DOY as stipulated in the Deed of Conditional Sale, and
was informed that AMA’s application was held in abeyance due to its poor credit reputation. EHCDSI
The petition has no merit. It is not accurate for petitioner to state that the Court of Appeals did not take into
account the time spent and the extent of the services rendered by Atty. Gabriel Jr. The Court of Appeals found that:
That Atty. Gabriel, Jr. was the counsel of DMI [DOY] up to the time the compromise agreement was
confirmed by the trial court. He only withdrew his appearance as counsel for co-plaintiffs Fred and Felipe Yap,
who were eventually dropped as parties to the case, along with the other individual defendants, as it was held that
only DMI was the real-party-in-interest.
It is evident that Atty. Gabriel, Jr. served as co-counsel together with Atty. Enrique C. Andres. DMI
was assisted by the former. Evidence of which was the service of a copy of the Judgment Based on Compromise
Agreement, including the Decision dated January 30, 1991, which dismissed C.A.-G.R. S.P. No. 22727, on Atty.
Gabriel, Jr.
A perusal of the pleadings enumerated by the plaintiff-appellant reveals the competence of Atty.
Gabriel, Jr. in handling the case. The degree and extent of service rendered by an attorney for a client is best
measured in terms other than the mere number of sheets of paper. 4
Indeed, the assailed Decision even contains an enumeration of the pleadings filed by counsel in behalf of his client. 5
In fixing the award of attorney's fees, the Court of Appeals also considered the amount involved in the controversy
and the benefits resulting to the client from the service in fixing Atty. Gabriel, Jr.’s fees, thus:
. . . While it is true that Civil Case No. CEB 9043 was terminated by virtue of a compromise agreement
by the parties, this is still to be taken as beneficial to DMI as the dispute was finally resolved without having to
resort to a full-blown trial on the merits which often would take time before the light at the end of the tunnel may
be seen.
xxx xxx xxx
DMI also assails the use of the value of the property involved in the litigation to serve as a basis or
standard in computing and awarding attorney’s fees. A simple perusal of the provisions of Section 24, Rule 138
of the Revised Rules of Court, as well as Canon 20, Rule 20.01 of the Code of Professional Responsibility, would
show that “the value of the property” was not enumerated as one of the factors but instead they used “the
importance of the subject matter” as a determinant of the amount of award of attorney’s fees. Nevertheless, the
Supreme Court has included as one of the determinants for the reasonableness of the award of attorney’s fees “the
value of the property affected by the controversy.” . . .
xxx xxx xxx
The issue of the reasonableness of attorney’s fees based on quantum meruit is a question of fact and
well-settled is the rule that conclusions and findings of fact by the lower courts are entitled to great weight on
appeal and will not be disturbed except for strong and cogent reasons.
The trial court's initial award of P200,000.00 as attorney’s fees of Atty. Gabriel, Jr. is reasonable. On
the other hand, the increased award of P500,000.00 cannot be justified, taking into account the recognized
parameters of quantum meruit. 6
The Court of Appeals then ended on this note:
Lastly, we take this occasion to reiterate the fact that while the practice of law is not a business, the
attorney plays a vital role in the administration of justice and, hence, the need to secure to him his honorarium
lawfully earned as a means to preserve the decorum and respectability of the legal profession. A lawyer is as much
entitled to judicial protection against injustice or imposition on the part of his client just as the client can claim
protection against abuse on the part of his counsel. The duty of the court is not alone to see that a lawyer acts in a
proper and lawful manner, it is also its duty to see that a lawyer is paid his just fees. With his capital consisting
only of his brains and with his skill acquired at tremendous cost not only in money but in expenditure of time and
energy, he is entitled to the protection of any judicial tribunal against any attempt on the part of his client to escape
payment of his just compensation. It would be ironic if, after putting forth the best in him to secure justice for his
client, he himself would not get his due. 7
This Court finds no reversible error in the above disquisition.
Petitioner's contention that the appellate court should also have taken into account the importance of the subject
matter in controversy and the professional standing of counsel in determining the latter’s fees is untenable. Although Rule
138 of the Rules of Court and Rule 20.01 of the Code of Professional Responsibility list several other factors in setting such
fees, these are mere guides in ascertaining the real value of the lawyer's service. 8 Courts are not bound to consider all these
factors in fixing attorney's fees.
While a lawyer should charge only fair and reasonable fees, 9 no hard and fast rule may be set in the determination
of what a reasonable fee is, or what is not. That must be established from the facts in each case. 10 As the Court of Appeals
is the final adjudicator of facts, this Court is bound by the former’s findings on the propriety of the amount of attorney’s
fees.
ACCORDINGLY, the Court Resolved to DENY the Petition and AFFIRM the Decision of the Court of Appeals.
[A.C. No. 5108. May 26, 2005.]
ROSA F. MERCADO, complainant, vs. ATTY. JULITO D. VITRIOLO, respondent.
DECISION
PUNO, J :
p
Rosa F. Mercado filed the instant administrative complaint against Atty. Julito D. Vitriolo, seeking his disbarment
from the practice of law. The complainant alleged that respondent maliciously instituted a criminal case for falsification of
public document against her, a former client, based on confidential information gained from their attorney-client
relationship.
Let us first hearken to the facts.
Complainant is a Senior Education Program Specialist of the Standards Development Division, Office of
Programs and Standards while respondent is a Deputy Executive Director IV of the Commission on Higher Education
(CHED). 1
Complainant's husband filed Civil Case No. 40537 entitled "Ruben G. Mercado v. Rosa C. Francisco," for
annulment of their marriage with the Regional Trial Court (RTC) of Pasig City. This annulment case had been dismissed
by the trial court, and the dismissal became final and executory on July 15, 1992. 2
In August 1992, Atty. Anastacio P. de Leon, counsel of complainant, died. On February 7, 1994, respondent
entered his appearance before the trial court as collaborating counsel for complainant. 3
On March 16, 1994, respondent filed his Notice of Substitution of Counsel, 4 informing the RTC of Pasig City
that he has been appointed as counsel for the complainant, in substitution of Atty. de Leon.
 It also appears that on April 13, 1999, respondent filed a criminal action against complainant before the Office of
the City Prosecutor, Pasig City, entitled "Atty. Julito Vitriolo, et al. v. Rose Dela Cruz F. Mercado," and docketed as I.S.
No. PSG 99-9823, for violation of Articles 171 and 172 (falsification of public document) of the Revised Penal
Code. 5 Respondent alleged that complainant made false entries in the Certificates of Live Birth of her children, Angelica
and Katelyn Anne. More specifically, complainant allegedly indicated in said Certificates of Live Birth that she is married
to a certain Ferdinand Fernandez, and that their marriage was solemnized on April 11, 1979, when in truth, she is legally
married to Ruben G. Mercado and their marriage took place on April 11, 1978.
Complainant denied the accusations of respondent against her. She denied using any other name than "Rosa F.
Mercado." She also insisted that she has gotten married only once, on April 11, 1978, to Ruben G. Mercado.
In addition, complainant Mercado cited other charges against respondent that are pending before or decided upon
by other tribunals — (1) libel suit before the Office of the City Prosecutor, Pasig City; 6 (2) administrative case for
dishonesty, grave misconduct, conduct prejudicial to the best interest of the service, pursuit of private business, vocation or
profession without the permission required by Civil Service rules and regulations, and violations of the "Anti-Graft and
Corrupt Practices Act," before the then Presidential Commission Against Graft and Corruption; 7 (3) complaint for
dishonesty, grave misconduct, and conduct prejudicial to the best interest of the service before the Office of the Ombudsman,
where he was found guilty of misconduct and meted out the penalty of one month suspension without pay; 8 and, (4) the
Information for violation of Section 7(b)(2) of Republic Act No. 6713, as amended, otherwise known as the Code of
Conduct and Ethical Standards for Public Officials and Employees before the Sandiganbayan. 9
Complainant Mercado alleged that said criminal complaint for falsification of public document (I.S. No. PSG 99-
9823) disclosed confidential facts and information relating to the civil case for annulment, then handled by respondent
Vitriolo as her counsel. This prompted complainant Mercado to bring this action against respondent. She claims that, in
filing the criminal case for falsification, respondent is guilty of breaching their privileged and confidential lawyer-client
relationship, and should be disbarred. ITECSH
Respondent filed his Comment/Motion to Dismiss on November 3, 1999 where he alleged that the complaint for
disbarment was all hearsay, misleading and irrelevant because all the allegations leveled against him are subject of separate
fact-finding bodies. Respondent claimed that the pending cases against him are not grounds for disbarment, and that he is
presumed to be innocent until proven otherwise. 10 He also states that the decision of the Ombudsman finding him guilty of
misconduct and imposing upon him the penalty of suspension for one month without pay is on appeal with the Court of
Appeals. He adds that he was found guilty, only of simple misconduct, which he committed in good faith. 11
In addition, respondent maintains that his filing of the criminal complaint for falsification of public documents
against complainant does not violate the rule on privileged communication between attorney and client because the bases
of the falsification case are two certificates of live birth which are public documents and in no way connected with the
confidence taken during the engagement of respondent as counsel. According to respondent, the complainant confided to
him as then counsel only matters of facts relating to the annulment case. Nothing was said about the alleged falsification of
the entries in the birth certificates of her two daughters. The birth certificates are filed in the Records Division of CHED
and are accessible to anyone. 12
In a Resolution dated February 9, 2000, this Court referred the administrative case to the Integrated Bar of the
Philippines (IBP) for investigation, report and recommendation. 13
The IBP Commission on Bar Discipline set two dates for hearing but complainant failed to appear in both.
Investigating Commissioner Rosalina R. Datiles thus granted respondent's motion to file his memorandum, and the case
was submitted for resolution based on the pleadings submitted by the parties. 14
On June 21, 2003, the IBP Board of Governors approved the report of investigating commissioner Datiles, finding
the respondent guilty of violating the rule on privileged communication between attorney and client, and recommending his
suspension from the practice of law for one (1) year.
On August 6, 2003, complainant, upon receiving a copy of the IBP report and recommendation, wrote Chief
Justice Hilario Davide, Jr., a letter of desistance. She stated that after the passage of so many years, she has now found
forgiveness for those who have wronged her.
At the outset, we stress that we shall not inquire into the merits of the various criminal and administrative cases
filed against respondent. It is the duty of the tribunals where these cases are pending to determine the guilt or innocence of
the respondent.
We also emphasize that the Court is not bound by any withdrawal of the complaint or desistance by the
complainant. The letter of complainant to the Chief Justice imparting forgiveness upon respondent is inconsequential in
disbarment proceedings.
We now resolve whether respondent violated the rule on privileged communication between attorney and client
when he filed a criminal case for falsification of public document against his former client.
A brief discussion of the nature of the relationship between attorney and client and the rule on attorney-client
privilege that is designed to protect such relation is in order.
In engaging the services of an attorney, the client reposes on him special powers of trust and confidence. Their
relationship is strictly personal and highly confidential and fiduciary. The relation is of such delicate, exacting and
confidential nature that is required by necessity and public interest. 15 Only by such confidentiality and protection will a
person be encouraged to repose his confidence in an attorney. The hypothesis is that abstinence from seeking legal advice
in a good cause is an evil which is fatal to the administration of justice. 16 Thus, the preservation and protection of that
relation will encourage a client to entrust his legal problems to an attorney, which is of paramount importance to the
administration of justice. 17 One rule adopted to serve this purpose is the attorney-client privilege: an attorney is to keep
inviolate his client's secrets or confidence and not to abuse them. 18 Thus, the duty of a lawyer to preserve his client's secrets
and confidence outlasts the termination of the attorney-client relationship, 19 and continues even after the client's death. 20 It
is the glory of the legal profession that its fidelity to its client can be depended on, and that a man may safely go to a lawyer
and converse with him upon his rights or supposed rights in any litigation with absolute assurance that the lawyer's tongue
is tied from ever disclosing it. 21 With full disclosure of the facts of the case by the client to his attorney, adequate legal
representation will result in the ascertainment and enforcement of rights or the prosecution or defense of the client's cause.
Now, we go to the rule on attorney-client privilege. Dean Wigmore cites the factors essential to establish the
existence of the privilege, viz:
(1) Where legal advice of any kind is sought (2) from a professional legal adviser in his capacity as such, (3) the
communications relating to that purpose, (4) made in confidence (5) by the client, (6) are at his instance
permanently protected (7) from disclosure by himself or by the legal advisor, (8) except the protection be
waived. 22
In fine, the factors are as follows:
(1) There exists an attorney-client relationship, or a prospective attorney-client relationship, and it is by reason of
this relationship that the client made the communication.
aCTHDA
Matters disclosed by a prospective client to a lawyer are protected by the rule on privileged communication even
if the prospective client does not thereafter retain the lawyer or the latter declines the employment. 23 The reason for this is
to make the prospective client free to discuss whatever he wishes with the lawyer without fear that what he tells the lawyer
will be divulged or used against him, and for the lawyer to be equally free to obtain information from the prospective
client. 24
On the other hand, a communication from a (prospective) client to a lawyer for some purpose other than on
account of the (prospective) attorney-client relation is not privileged. Instructive is the case of Pfleider v. Palanca, 25 where
the client and his wife leased to their attorney a 1,328-hectare agricultural land for a period of ten years. In their contract,
the parties agreed, among others, that a specified portion of the lease rentals would be paid to the client-lessors, and the
remainder would be delivered by counsel-lessee to client's listed creditors. The client alleged that the list of creditors which
he had "confidentially" supplied counsel for the purpose of carrying out the terms of payment contained in the lease contract
was disclosed by counsel, in violation of their lawyer-client relation, to parties whose interests are adverse to those of the
client. As the client himself, however, states, in the execution of the terms of the aforesaid lease contract between the parties,
he furnished counsel with the "confidential" list of his creditors. We ruled that this indicates that client delivered the list of
his creditors to counsel not because of the professional relation then existing between them, but on account of the lease
agreement. We then held that a violation of the confidence that accompanied the delivery of that list would partake more of
a private and civil wrong than of a breach of the fidelity owing from a lawyer to his client.
(2) The client made the communication in confidence.
The mere relation of attorney and client does not raise a presumption of confidentiality. 26 The client must intend
the communication to be confidential. 27
A confidential communication refers to information transmitted by voluntary act of disclosure between attorney
and client in confidence and by means which, so far as the client is aware, discloses the information to no third person other
than one reasonably necessary for the transmission of the information or the accomplishment of the purpose for which it
was given. 28
Our jurisprudence on the matter rests on quiescent ground. Thus, a compromise agreement prepared by a lawyer
pursuant to the instruction of his client and delivered to the opposing party, 29 an offer and counter-offer for settlement, 30 or
a document given by a client to his counsel not in his professional capacity, 31 are not privileged communications, the
element of confidentiality not being present. 32
(3) The legal advice must be sought from the attorney in his professional capacity. 33
The communication made by a client to his attorney must not be intended for mere information, but for the purpose
of seeking legal advice from his attorney as to his rights or obligations. The communication must have been transmitted by
a client to his attorney for the purpose of seeking legal advice. 34
If the client seeks an accounting service, 35 or business or personal assistance, 36 and not legal advice, the privilege
does not attach to a communication disclosed for such purpose.
Applying all these rules to the case at bar, we hold that the evidence on record fails to substantiate complainant's
allegations. We note that complainant did not even specify the alleged communication in confidence disclosed by
respondent. All her claims were couched in general terms and lacked specificity. She contends that respondent violated the
rule on privileged communication when he instituted a criminal action against her for falsification of public documents
because the criminal complaint disclosed facts relating to the civil case for annulment then handled by respondent. She did
not, however, spell out these facts which will determine the merit of her complaint. The Court cannot be involved in a
guessing game as to the existence of facts which the complainant must prove.
Indeed, complainant failed to attend the hearings at the IBP. Without any testimony from the complainant as to
the specific confidential information allegedly divulged by respondent without her consent, it is difficult, if not impossible
to determine if there was any violation of the rule on privileged communication. Such confidential information is a crucial
link in establishing a breach of the rule on privileged communication between attorney and client. It is not enough to merely
assert the attorney-client privilege. 37 The burden of proving that the privilege applies is placed upon the party asserting the
privilege. 38
IN VIEW WHEREOF, the complaint against respondent Atty. Julito D. Vitriolo is hereby DISMISSED for lack
of merit.
FIRST DIVISION
[A.M. No. 4215. May 21, 2001.]
FELICISIMO M. MONTANO, complainant, vs. INTEGRATED BAR OF THE PHILIPPINES
and ATTY. JUAN S. DEALCA, respondents.
RESOLUTION
KAPUNAN, J : p
In a verified complaint filed before this Court on March 9, 1994, complainant Felicisimo M. Montano charged
Atty. Juan Dealca with misconduct and prays that he be "sternly dealt with administratively." The complaint 1 is summarized
as follows: IcCDA S
1. On November 14, 1992, the complainant hired the services of Atty. Juan S. Dealca as his counsel in
collaboration with Atty. Ronando L. Gerona in a case pending before the Court of Appeals docketed as CA-G.R. CV No.
37467 wherein the complainant was the plaintiff-appellant.
2. The parties agreed upon attorney's fees in the amount of P15,000.00, fifty percent (50%) of which was payable
upon acceptance of the case and the remaining balance upon the termination of the case. Accordingly, complainant paid
respondent the amount of P7,500.00 representing 50% of the attorney's fee. CAcIES
3. Thereafter, even before respondent counsel had prepared the appellant's brief and contrary to their agreement
that the remaining balance be payable after the termination of the case, Atty. Dealca demanded an additional payment from
complainant. Complainant obliged by paying the amount of P4,000.00.
4. Prior to the filing of the appellant's brief, respondent counsel again demanded payment of the remaining balance
of P3,500.00. When complainant was unable to do so, respondent lawyer withdrew his appearance as complainant's counsel
without his prior knowledge and/or conformity. Returning the case folder to the complainant, respondent counsel attached
a Note dated February 28, 1993, 2 stating: Pepe and Del Montano,
For breaking your promise, since you do not want to fulfill your end of the bargain, here's your reward:
Henceforth, you lawyer for yourselves. Here are your papers.
Complainant claimed that such conduct by respondent counsel exceeded the ethical standards of the law
profession and prays that the latter be sternly dealt with administratively. Complainant later on filed motions praying for
the imposition of the maximum penalty of disbarment. and referred the same to the IBP for evaluation and report.
After respondent counsel filed his comment on the complaint, the Court in the Resolution of August 1, 1994,
referred the case to the Integrated Bar of the Philippines (IBP) for investigation, report and recommendation. entitled case to Commissioner Vibar for evaluation, report and recommendation "in view of the Motion for Reconsideration
The Investigating Commissioner found respondent counsel guilty of unprofessional conduct and recommended granted by the Supreme Court."
that he be "severely reprimanded." However, in a Resolution 3 by the IBP Board of Governors on July 26, 1997, it was
resolved that the penalty recommended by the Investigating Commissioner meted to respondent be amended to "three (3)
months suspension from the practice of law for having been found guilty of misconduct, which eroded the public confidence
regarding his duty as a lawyer."
Respondent counsel sought reconsideration of the aforementioned resolution of the IBP, alleging that the latter
misapprehended the facts and that, in any case, he did not deserve the penalty imposed. The true facts, according to him,
are the following:
1. Complainant is being represented by Atty. Ronando L. Gerona in his case on appeal;
2. Due to the ailment of Atty. Gerona's daughter, he could not prepare and submit complainant's appellant's brief on time;
3. Complainant went to the respondent to do just that, i.e., prepare and submit his appellant's brief on time at the agreed fee of
P15,000.00, 50% down and 50% upon its completion;
ITEcAD
4. Working overtime, respondent was able to finish the appellant's brief ahead of its deadline, so he advised the complainant
about its completion with the request that the remaining balance of P7,500.00 be paid. Complainant paid P4,000.00 only,
promising to pay the P3,500.00 "tomorrow" or on "later particular date." Please take note that, at this juncture, there was already
a breach of the agreement on complainant's part.
5. When that "tomorrow" or on a "later particular date" came, respondent, thru a messenger, requested the complainant to pay
the P3,500.00 as promised but word was sent that he will again pay "tomorrow" or on a "later date." This promise-non-payment
cycle went on repeatedly until the last day of the filing of the brief. Please take note again that it was not the respondent but the
complainant who sets the date when he will pay, yet he fails to pay as promised;
6. Even without being paid completely, respondent, of his own free will and accord, filed complainant's brief on time;
EISCaD
7. After the brief was filed, respondent tried to collect from the complainant the remaining balance of P3,500.00, but the latter
made himself scarce. As the records would show, such P3,500.00 remains unpaid until now;
8. Sensing that something was amiss, respondent sent the February 28, 1993 note and case folder to the complainant, hoping
that the latter would see personally the former about it to settle the matter between them;
9. However, instead of seeing the respondent, complainant filed this case; IDSETA
10. Respondent was constrained to file his withdrawal with the Court of Appeals because of this case to avoid further
misunderstanding since he was the one who signed the appellant's brief although Atty. Gerona was his counsel of record. Such
withdrawal was accordingly granted by the appellate court;
xxx xxx xxx 4
Respondent counsel further averred that complainant's refusal to pay the agreed lawyer's fees, measly as it was,
was deliberate and in bad faith; hence, his withdrawal as counsel was "just, ethical and proper." Respondent counsel
concluded that not only was the penalty of suspension harsh for his act of merely trying to collect payment for his services
rendered, but it indirectly would punish his family since he was the sole breadwinner with children in school and his wife
terminally ill with cancer.
In its Resolution No. XIII-97-129 dated October 25, 1997, the IBP denied Atty. Dealca's motion for
reconsideration, to wit:
xxx xxx xxx
RESOLVED TO DENY Atty. Dealca's Motion For Reconsideration of the Board's Decision in the
above-entitled case there being no substantive reason to reverse the finding therein. Moreover, the motion is
improperly laid the remedy of the respondent is to file the appropriate pleading with the Supreme Court within
fifteen (15) days from receipt of notice of said Decision pursuant to Sec. 12 [c] of Rule 139-B. 5
On December 10, 1997, this Court noted the following pleadings filed in the present complaint,
(a) notice and a copy of Resolution No. XII-97-154 dated July 26, 1997 of the Integrated Bar of the Philippines amending
the recommendation of the Investigating Commissioner of reprimand to three (3) months suspension of respondent from
the practice of law for having been found guilty of misconduct which eroded the public confidence regarding his duty as
a lawyer;
(b) complainant's motion praying for the imposition of the maximum penalty of disbarment; TSaEcH
(c) motion dated September 15, 1997 of respondent for reconsideration of the aforesaid resolution of July 26, 1997;
(d) comment/opposition of respondent praying that the motion for the imposition of the maximum penalty be denied;
(e) comment of complainant praying that the penalty of three (3) months suspension from the practice of law as
recommended by the Integrated Bar of the Philippines pursuant to Resolution No. XII-97-154 be raised to a heavier
penalty;
(f) comment/manifestation/opposition of complainant praying that the respondent be disbarred; and
(g) rejoinder of respondent praying that this case be dismissed for being baseless.
In compliance therewith, on March 28, 1998, the IBP issued Resolution No. XIII-98-42 referring the above-
 The Investigating Commissioner, after referring the case, recommended that his original recommendation of the will disbarment be imposed as a penalty. It should never be decreed where a lesser penalty, such as temporary suspension,
imposition of the penalty of reprimand be maintained, noting that respondent counsel had served the IBP well as President would accomplish the end desired. 12 In the present case, reprimand is deemed sufficient.
of the Sorsogon Chapter. 7 Accordingly, on February 23, 1999, the IBP Board of Governors, issued the following resolution: WHEREFORE, in view of the foregoing, respondent Atty. Juan S. Dealca is REPRIMANDED with a warning
RESOLUTION NO. XIII-99-48 that repetition of the same act will be dealt with more severely.
xxx xxx xxx SECOND DIVISION
RESOLVED to ADOPT and APPROVE, as it is hereby ADOPTED and APPROVED, the Report and [G.R. Nos. 86100-03. January 23, 1990.]
Recommendation of the Investigating Commissioner in the above-entitled case, herein made part of this
METROPOLITAN BANK AND TRUST COMPANY, petitioner, vs. THEHONORABLE COURT OF APPEALS
Resolution/Decision as Annex "A"; and, finding the recommendation fully supported by the evidence on record
and the applicable laws and rules, the Motion for Reconsideration be granted and that the penalty and ARTURO ALAFRIZ and ASSOCIATES, respondents.
of REPRIMAND earlier recommended by the Investigating Commissioner be imposed on Atty. Juan S. Dealca. 8 Bautista, Picazo, Buyco, Tan & Fider for petitioner.
Complainant asked the IBP to reconsider the foregoing resolution but the motion was denied. 9 Arturo A. Alafriz & Associates for and in their own behalf.
On April 10, 2000, complainant filed with this Court a petition for review on certiorari in connection with SYLLABUS
Administrative Case No. 4215 against the IBP and respondent counsel averring that the IBP Board of Governors committed 1. JUDGMENTS; CHARGING LIENS; ENFORCEABLE AS SECURITY FOR PAYMENT OF ATTORNEY'S FEES. —
grave abuse of discretion when it overturned its earlier resolution and granted respondent counsel's motion for On the matter of attorney's liens, Section 37, Rule 138 provides: " . . . He shall also have a lien to the same extent upon all
reconsideration on February 23, 1999. He claimed that the earlier resolution denying the motion for reconsideration issued judgments for the payment of money, and executions issued in pursuance of such judgments, which he has secured a
on October 25, 1997 had already become final and executory; hence, any further action or motion subsequent to such final 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
and executory judgment shall be null and void. upon the records of thecourt rendering such judgment, or issuing such execution, and shall have caused written notice
When the Court issued the resolution of December 10, 1997 treating the several pleadings filed in the present thereof to be delivered to his client and to the adverse party; and he shall have the same right and power over such judgments
complaint, it should be noted that the IBP resolution denying respondent's motion for reconsideration (Resolution No. XIII- and executions as his client would have to enforce his lien and secure the payment of his just fees and disbursements."
97-129) dated October 25, 1997, for some reason, had not yet reached this Court. As of that date, the only IBP resolution Consequent to such provision, a charging lien, to be enforceable as security for the payment of attorney's fees, requires as a
attached to the records of the case was Resolution No. XII-97-54 amending the administrative sanction from reprimand to condition sine qua non a judgment for money and execution in pursuance of such judgment secured in the main action by
three months suspension. Hence, at the time the pleadings were referred back to the IBP in the same resolution, the Court the attorney in favor of his client. A lawyer may enforce his right to fees by filing the necessary petition as an incident in
was not aware that the IBP had already disposed of the motion for reconsideration filed by respondent counsel. the main action in which his services were rendered when something is due his client in the action from which the fee is to
Thus, when the IBP was informed of the said Court resolution, it construed the same as granting Atty. Dealca's be paid.
motion for reconsideration and as an order for IBP to conduct a re-evaluation of the case. The IBP assumed that its resolution 2. ID.; ID.; NOT ENFORCEABLE IN CASE AT BAR. — In the case at bar, the civil cases below were dismissed upon the
of October 25, 1997 was already considered by this Court when it referred the case back to the IBP. It failed to notice that initiative of the plaintiffs "in view of the full satisfaction of their claims." The dismissal order neither provided for any
its resolution denying the motion for reconsideration was not among those pleadings and resolution referred back to it. money judgment nor made any monetary award to any litigant, much less in favor of petitioner who was a defendant therein.
Hence, on the strength of this Court's resolution which it had inadvertently misconstrued, the IBP conducted a re- This being so, private respondent's supposed charging lien is, under our rules, without any legal basis. It is flawed by the
evaluation of the case and came up with the assailed resolution now sought to be reversed. The Court holds that the error is fact that there is nothing to generate it and to which it can attach in the same manner as an ordinary lien arises and attaches
not attributable to the IBP. It is regrettable that the procedural infirmity alleged by complainant actually arose from a mere to real or personal property. In point is Morente vs. Firmalino, cited by petitioner in support of its position. In that case,
oversight which was attributable to neither party. HSATIC
movant-appellant attorney sought the payment of his fees from his client who was the defendant in a complaint for
Going into the merits, we affirm the findings made by the IBP that complainant engaged the services of respondent injunction which was dismissed by the trial court after the approval of an agreement entered into by the litigants.
lawyer only for the preparation and submission of the appellant's brief and the attorney's fees was payable upon the This Court held: " . . . The defendant having suffered no actual damage by virtue of the issuance of a preliminary injunction,
completion and submission of the appellant's brief and not upon the termination of the case. it follows that no sum can be awarded the defendant for damages It becomes apparent, too, that no amount having been
There is sufficient evidence which indicates complainant's willingness to pay the attorney's fees. As agreed upon, awarded the defendant, herein appellant's lien could not be enforced. The appellant, could, by appropriate action, collect his
complainant paid half of the fees in the amount of P7,500.00 upon acceptance of the case. And while the remaining balance fees as attorney."
was not yet due as it was agreed to be paid only upon the completion and submission of the brief, complainant nonetheless 3. ID.; ID.; FOREIGN JUDGMENTS NOT GIVEN WEIGHT WHERE THE LAW APPLICABLE IS CLEAR AND
delivered to respondent lawyer P4,000.00 as the latter demanded. This, notwithstanding, Atty. Dealca withdrew his UNEQUIVOCAL. — It is true that there are some American cases holding that the lien attaches even to properties in
appearance simply because of complainant's failure to pay the remaining balance of P3,500.00, which does not appear to be litigation. However, the statutory rules on which they are based and the factual situations involved therein are neither
deliberate. The situation was aggravated by respondent counsel's note to complainant withdrawing as counsel which was explained nor may it be said that they are of continuing validity as to be applicable in this jurisdiction. It cannot be gainsaid
couched in impolite and insulting language. that legal concepts of foreign origin undergo a number of variegations or nuances upon adoption by other jurisdictions,
Given the above circumstances, was Atty. Dealca's conduct just and proper? especially those with variant legal systems. Since in our jurisdiction the applicable rule provides that a charging lien attaches
We find Atty. Dealca's conduct unbecoming of a member of the legal profession. Under Canon 22 of the Code of only to judgments for money and executions in pursuance of such judgment, then it must be taken in haec verba. The
Professional Responsibility, a lawyer shall withdraw his services only for good cause and upon notice appropriate in the language of the law is clear and unequivocal and, therefore, it must be taken to mean exactly what it says, barring any
circumstances. Although he may withdraw his services when the client deliberately fails to pay the fees for the necessity for elaborate interpretation.
services, 11 under the circumstances of the present case, Atty. Dealca's withdrawal was unjustified as complainant did not 4. ID.; PETITION FOR RECOVERY OF ATTORNEY'S FEES, HEARING NECESSARY. — A petition for
deliberately fail to pay him the attorney's fees. In fact, complainant exerted honest efforts to fulfill his obligation. recovery of attorney's fees, either as a separate civil suit or as an incident in the main action, has to be prosecuted and the
Respondent's contemptuous conduct does not speak well of a member of the bar considering that the amount owing to him allegations therein established as any other money claim. The persons who are entitled to or who must pay attorney's fees
was only P3,500.00. Rule 20.4 of Canon 20, mandates that a lawyer shall avoid controversies with clients concerning his have the right to be heard upon the question of their propriety or amount. Hence, the obvious necessity of a hearing is
compensation and shall resort to judicial action only to prevent imposition, injustice or fraud. Sadly, for not so large a sum beyond cavil.
owed to him by complainant, respondent lawyer failed to act in accordance with the demands of the Code. 5. ID.; FEES; QUANTUM MERUIT BASIS, ELEMENTS THEREOF. — in fixing a reasonable compensation for the
The Court, however, does not agree with complainant's contention that the maximum penalty of disbarment should services rendered by a lawyer on the basis of quantum meruit, the elements to be considered are generally (1) the
be imposed on respondent lawyer. The power to disbar must be exercised with great caution. Only in a clear case of importance of the subject matter in controversy, (2) the extent of the services rendered, and (3) the professional
misconduct that seriously affects the standing and character of the lawyer as an officer of the Court and member of the bar standing of the lawyer. These are aside from the several other considerations laid down by this Court in a
number of decisions as pointed out by respondent court. A determination of all these factors would indispensably require
nothing less than a full-blown trial where private respondent can adduce evidence to establish its right to lawful attorney's
fees and for petitioner to oppose or refute the same.
5. ID.; ID.; COLLECTION THEREOF; PROPER LEGAL REMEDY SHOULD BE AVAILED OF AND PROCEDURAL
RULES DULY OBSERVED. — As in the exercise of any other right conferred by law, the proper legal remedy should be
availed of and the procedural rules duly observed to forestall and obviate the possibility of abuse or prejudice, or what may
be misunderstood to be such, often to the undeserved discredit of the legal profession. Law advocacy, it has been stressed,
is not capital that yields profits. The returns it births are simple rewards for a job done or service rendered. It is a calling
that, unlike mercantile pursuits which enjoy a greater deal of freedom from government interference, is impressed with
public interest, for which it is subject to State regulation.
DECISION
REGALADO, J : p We agree with petitioner.
This petition for review on certiorari impugns the decision of the Court of Appeals in CA-G.R. Nos. 08265-
08268 1 affirming the order of Branch 168, Regional Trial Court, National Capital Judicial Region, in Civil Cases Nos.
19123-28,19136 and 19144, fixing attorney's fees and directing herein petitioner Metropolitan Bank and TrustCompany
(Metrobank, for brevity), as defendant in said civil cases, to pay its attorneys, herein private respondent Arturo Alafriz and
Associates, movant therein, the amount of P936,000.00 as attorney's fees on a quantum merit basis.
The records show that from March, 1974 to September, 1983, private respondent handled the above-mentioned civil cases
before the then Court of First Instance ofPasig (Branches I, II, VI, X, XIII, XIX, XX AND XXIV) in
behalf of petitioner. 2 The civil cases were all for the declaration of nullity of certain deeds of sale, with damages.
The antecedental facts 3 which spawned the filing of said actions are undisputed and are hereinunder set forth as found by
the trial court and adopted substantially in the decision of respondent court. A certain Celedonio Javier bought seven (7)
parcels of land owned by Eustaquio Alejandro, et al., with a total area of about ten (10) hectares. These properties were
thereafter mortgaged by Javier with the petitioner to secure a loan obligation of one Felix Angelo Bautista and or
International Hotel Corporation. The obligors having defaulted, petitioner foreclosed the mortgages after which
certificates of sale were issued by the provincial sheriff in its favor as purchaser thereof. Subsequently, Alejandro, alleging
deceit, fraud and misrepresentation committed against him by Javier in the sale of the parcels of land, brought suits against
Javier, et al., and included petitioner as defendant therein.LibLex
It was during the pendency of these suits that these parcels of land were sold by petitioner to its sister corporation, Service
Leasing Corporation on March 23, 1983 for the purported price of P600,000.00. On the same day, the properties were resold
by the latter to Herby Commercial and Construction Corporation for the purported price of P2,500,000.00. Three months
later, or on June 7, 1983, Herby mortgaged the same properties with Banco de Oro for P9,200,000.00. The lower court found
that private respondent, did not have knowledge of these transfers and transactions.
As a consequence of the transfer of said parcels of land to Service Leasing Corporation, petitioner filed an urgent motion
for substitution of party on July 28, 1983. Private respondent, on its part, filed on August 16, 1983 a verified motion to enter
in the records of the aforesaid civil cases its charging lien, pursuant to Section 37, Rule 138 of the Rules of Court, equivalent
to twenty-five percent (25%) of the actual and current market values of the litigated properties as its attorney's fees. Despite
due notice, petitioner failed to appear and oppose said motion, as a result of which the lower court granted the same and
ordered the Register of Deeds of Rizal to annotate the attorney's liens on the certificates of title of the parcels of land.
Meanwhile, the plaintiffs Alejandro, et al. in the aforesaid civil cases, which had been consolidated and were pending before
the Regional Trial Court of Pasig, filed a motion to dismiss their complaints therein, which motion the lower court granted
with prejudice in its order dated September 5, 1983. On December 29, 1983, the samecourt ordered the Register of Deeds
to annotate the attorney's liens of private respondent on the derivative titles which cancelled Transfer Certificates of Title
Nos. 453093 to 453099 of the original seven (7) parcels of land hereinbefore adverted to.
On May 28, 1984, private respondent filed a motion to fix its attorney's fees, based on quantum meruit, which motion
precipitated an exchange of arguments between the parties. On May 30, 1984, petitioner manifested that it had fully paid
private respondent; the latter, in turn, countered that the amount of P50,000.00 given by petitioner could not be considered
as full payment but merely a cash advance, including the amount of P14,000.00 paid to it on December 15, 1980. It further
appears that private respondent attempted to arrange a compromise with petitioner in order to avoid suit, offering a
compromise amount of P600,000.00 but the negotiations were unsuccessful. cdll
Finally, on October 15, 1984, the court a quo issued the order assailed on appeal before respondent court, granting
payment of attorney's fees to private respondent, under the following dispositive portion:
"PREMISES CONSIDERED, the motion is hereby granted and the Metropolitan Bank and Trust Company
(METROBANK) and Herby Commercial and Construction Corporation 4 are hereby ordered to pay the movant Arturo
Alafriz and Associates the amount of P936,000.00 as its proper, just and reasonable attorney's fees in these cases." 5
On appeal, respondent court affirmed the order of the trial court in its decision promulgated on February 11, 1988. A motion
for reconsideration, dated March 3, 1988, was filed by petitioner but the same was denied in a resolution promulgated on
November 19, 1988, hence the present recourse.
The issues raised and submitted for determination in the present petition may be formulated thus: (1) whether or not private
respondent is entitled to the enforcementof its charging lien for payment of its attorney's fees; (2) whether or not a separate
civil suit is necessary for the enforcement of such lien, and (3) whether or not private respondent is entitled to twenty-five
(25%) of the actual and current market values of the litigated properties on a quantum meruit basis.
On the first issue, petitioner avers that private respondent has no enforceable attorney's charging lien in the civil cases before
the court below because the dismissal ofthe complaints therein were not, in the words of Section 37, Rule 138, judgments
for the payment of money or executions issued in pursuance of such judgments. 6
On the matter of attorney's liens, Section 37, Rule 138 provides:
" . . . 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 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 courtrendering 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."
Consequent to such provision, a charging lien, to be enforceable as security for the payment of attorney's fees, requires as a
condition sine qua non a judgment for money and execution in pursuance of such judgment secured in the main action by
the attorney in favor of his client. A lawyer may enforce his right to fees by filing the necessary petition as an incident in
the main action in which his services were rendered when something is due his client in the action from which the fee is to
be paid. 7
In the case at bar, the civil cases below were dismissed upon the initiative of the plaintiffs "in view of the full
satisfaction of their claims." 8 The dismissal order neither provided for any money judgment nor made any monetary award
to any litigant, much less in favor of petitioner who was a defendant therein. This being so, private respondent's supposed
charging lien is, under our rules, without any legal basis. It is flawed by the fact that there is nothing to generate it and to
which it can attach in the same manner as an ordinary lien arises and attaches to real or personal property. llcd
In point is Morente vs. Firmalino, 9 cited by petitioner in support of its position. In that case, movant-appellant attorney
sought the payment of his fees from his client who was the defendant in a complaint for injunction which was dismissed by
the trial court after the approval of an agreement entered into by the litigants. This Courtheld:
" . . . The defendant having suffered no actual damage by virtue of the issuance of a preliminary injunction, it follows that no
sum can be awarded the defendant for damages It becomes apparent, too, that no amount having been awarded the defendant,
herein appellant's lien could not be enforced. The appellant, could, by appropriate action, collect his fees as attorney."
Private respondent would nevertheless insist that the lien attaches to the "proceeds of a judgment of whatever
nature," 10 relying on the case of Bacolod-Murcia MillingCo. Inc. vs. Henares 11 and some American cases holding that the
lien attaches to the judgment recovered by an attorney and the proceeds in whatever form they may be. 12
The contention is without merit just as its reliance is misplaced. It is true that there are some American cases holding that
the lien attaches even to properties in litigation. However, the statutory rules on which they are based and the factual
situations involved therein are neither explained nor may it be said that they are ofcontinuing validity as to be applicable in
this jurisdiction. It cannot be gainsaid that legal concepts of foreign origin undergo a number of variegations or nuances
upon adoption by other jurisdictions, especially those with variant legal systems.
In fact, the same source from which private respondent culled the American cases it cited expressly declares that "in the
absence of a statute or of a special agreement providing otherwise, the general rule is that an attorney has no lien on the
land of his client, notwithstanding such attorney has, with respect to the land in question, successfully prosecuted a suit to
establish the title of his client thereto, recovered title or possession in a suit prosecuted by such client, or defended
successfully such client's right and title against an unjust claim or an unwarranted attack," 13 as is the situation in the case at
bar. This is an inescapable recognition that a contrary rule obtains in other jurisdictions thereby resulting in doctrinal
rulings of converse or modulated import. LLpr
To repeat, since in our jurisdiction the applicable rule provides that a charging lien attaches only to judgments for money
and executions in pursuance of such judgment, then it must be taken in haec verba. The language of the law is clear and
unequivocal and, therefore, it must be taken to mean exactly what it says, barring any necessity for elaborate interpretation. 14
Notably, the interpretation, literal as it may appear to be, is not without support in Philippine case law despite the
dearth of cases on all fours with the present case. InCaiña, et al. vs. Victoriano, et al., 15 the Court had the occasion to rule
that "the lien of respondent is not of a nature which attaches to the property in litigation but is at most a personal claim
enforceable by a writ of execution." In Ampil vs. Juliano-Agrava, et al., 16 the Court once again declared that a charging lien
"presupposes that the attorney has secured a favorable money judgment for his client . . . ." Further, in Director of Lands vs.
Ababa, et al., 17 we held that "(a) charging lien under Section 37, Rule 138 of the Revised Rules of Court is limited only to
money judgments and not to judgments for the annulment of a contract or for delivery of real property as in the instant
case."
Even in the Bacolod-Murcia Milling case, which we previously noted as cited by private respondent, there was an express
declaration that "in this jurisdiction, the lien does not attach to the property in litigation."
Indeed, an attorney may acquire a lien for his compensation upon money due his client from the adverse party in any action
or proceeding in which the attorney is employed, but such lien does not extend to land which is the subject matter of the
litigation. 18 More specifically, an attorney merely defeating recovery against his client as a defendant is not entitled to a
lien on the property involved in litigation for fees and the court has no power to fix the fee of an attorney defending the
client's title to property already in the client's possession. 19
While a client cannot defeat an attorney's right to his charging lien by dismissing the case, terminating the services of his
counsel, waiving his cause or interest in favorof the adverse party or compromising his action, 20 this rule cannot find
application here as the termination of the cases below was not at the instance of private respondent's client but of the
opposing party.
The resolution of the second issue is accordingly subsumed in the preceding discussion which amply demonstrates that
private respondent is not entitled to the enforcement of its charging lien.
Nonetheless, it bears mention at this juncture that an enforceable charging lien, duly recorded, is within the
jurisdiction of the court trying the main case and this jurisdiction subsists until the lien is settled. 21 There is certainly no
valid reason why the trial court cannot pass upon a petition to determine attorney's fees if the rule against multiplicity of suits
is to be activated. 22 These decisional rules, however, apply only where the charging lien is valid and enforceable under the
rules.
On the last issue, the Court refrains from resolving the same so as not to preempt or interfere with the authority and
adjudicative facility of the proper court to hear and decide the controversy in a proper proceeding which may be brought by
private respondent. LLphil
A petition for recovery of attorney's fees, either as a separate civil suit or as an incident in the main action, has to be
prosecuted and the allegations therein established as any other money claim. The persons who are entitled to or who must
pay attorney's fees have the right to be heard upon the question of their propriety or amount.23 Hence, the obvious
necessity of a hearing is beyond cavil.
Besides, in fixing a reasonable compensation for the services rendered by a lawyer on the basis of quantum meruit, the
elements to be considered are generally (1) the importance of the subject matter in controversy, (2) the extent of the services
rendered, and (3) the professional standing of the lawyer. 24 These are aside from the several other considerations laid down
by this Court in a number of decisions as pointed out by respondent court. 25 A determination of all these factors would
indispensably require nothing less than a full-blown trial where private respondent can adduce evidence to establish its right
to lawful attorney's fees and for petitioner to oppose or refute the same.
Nothing in this decision should, however, be misconstrued as imposing an unnecessary burden on private respondent in
collecting the fees to which it may rightfully be entitled. But, as in the exercise of any other right conferred by law, the
proper legal remedy should be availed of and the procedural rules duly observed to forestall and obviate the
possibility of abuse or prejudice, or what may be misunderstood to be such, often to the undeserved discredit of the legal
profession.
Law advocacy, it has been stressed, is not capital that yields profits. The returns it births are simple rewards for a job done
or service rendered. It is a calling that, unlike mercantile pursuits which enjoy a greater deal of freedom from government
interference, is impressed with public interest, for which it is subject to State regulation. 26
ACCORDINGLY, the instant petition for review is hereby GRANTED and the
decision of respondent Court of Appeals of February 11, 1988 affirming the order of the trialcourt is hereby REVERSED
and SET ASIDE, without prejudice to such appropriate proceedings as may be brought by private respondent to establish
its right to attorney's fees and the amount thereof.
SO ORDERED.
[A.C. No. 6266. November 16, 2006.]
ESTELA ANASTACIO-BRIONES, complainant, vs. ATTY. ALFREDO A. ZAPANTA, respondent.
DECISION
QUISUMBING, J : p
This is a disbarment complaint filed by Estela Anastacio-Briones against respondent Atty. Alfredo A. Zapanta for
abandonment and neglect of duties.
In her Complaint 1 dated December 1, 2003, Estela Anastacio-Briones stated that she engaged the services of
respondent to file three civil cases involving a parcel of land located in Antipolo City. The cases were then
consolidated 2 before the Regional Trial Court of Antipolo City, Branch 73.
Complainant averred that on October 25, 2002, she showed respondent a copy of "Discharge and Appearance of
Counsels with Ex-parte Motion to Cancel the October 25, 2002 Hearing" she intended to file that day. She claimed that
even prior to the hearing, she informed respondent of her joint venture agreement with a real estate developer who offered
the services of its own counsel. Complainant added that respondent requested her not to file it and he would submit a
withdrawal of appearance instead. Complainant also informed respondent that she could not attend the hearing on January
6, 2003 because of other commitments. Respondent allegedly assured her that he would be present in the hearing. caTESD
On January 6, 2003, both respondent and complainant failed to appear in the hearing. As a result, the trial court
declared them to have waived their right to present further witnesses and directed them to file their formal offer of evidence
within ten days from notice. The trial court noted that respondent received its Order on January 24, 2003, but respondent
did not act on it within the ten-day period. Instead of filing a formal offer of evidence, respondent filed a withdrawal of
appearance on March 5, 2003. On March 10, 2003, the trial court dismissed the case with prejudice. 3
On May 5, 2003, complainant learned that the cases were dismissed and that respondent did not attend the January
6, 2003 hearing and did not file a formal offer of evidence.
Complainant prayed that respondent be disbarred for abandoning her case and withdrawing his appearance as
counsel without her knowledge.
In his Comment 4 dated June 10, 2004, respondent countered that he was discharged as complainant's counsel
after the October 25, 2002 hearing. Respondent added that he prepared a withdrawal of appearance on October 30, 2002 but
complainant ignored his several requests to sign it in his office. Nevertheless, he claimed he filed a withdrawal of appearance
on March 5, 2003 without complainant's conformity.
Respondent denied promising complainant that he would attend the January 6, 2003 hearing. According to him,
complainant informed his secretary that her new lawyer would attend. Respondent claimed further that complainant's new
lawyer should be faulted for belatedly filing an entry of appearance and a motion for reconsideration. Respondent claimed
that he was merely being used as a scapegoat for complainant's own negligence in pursuing the cases.
In a Resolution 5 dated September 20, 2004, the Court referred the matter to the Integrated Bar of the Philippines
(IBP) for investigation, report and recommendation.
In his Report and Recommendation dated May 26, 2005, Commissioner Dennis A.B. Funa of the IBP Commission
on Bar Discipline found respondent liable for negligence in the performance of his duties as counsel, and for violating the
Code of Professional Responsibility. Commissioner Funa recommended respondent's suspension for three months from the
practice of law.
In Resolution No. XVII-2005-104 dated October 22, 2005, the IBP Board of Governors adopted and approved
the report and recommendation of Commissioner Funa. On November 15, 2005, the IBP Board of Governors forwarded the
Report to this Court pursuant to Rule 139-B of the Rules of Court. DCaSHI
On January 4, 2006, respondent filed with this Court a motion for reconsideration. In its comment, the IBP,
through Commissioner Funa, recommended the denial of the motion.
We sustain the findings of the IBP that respondent was remiss in performing his duties as counsel of complainant.
The Court finds respondent liable for negligence and for violation of Canon 18 6 specifically Rules 18.03 7 and 18.04 8 of
the Code of Professional Responsibility.
Section 26, Rule 138 of the Rules of Court 9 provides the proper procedure for a lawyer's withdrawal as counsel
in a case. Unless the procedure prescribed in the abovementioned section is complied with, the attorney of record is regarded
as the counsel who should be served with copies of the judgments, orders and pleadings and who should be held responsible
for the case. 10 For its part, the court could recognize no other representation on behalf of the client except such counsel of
record until a formal substitution of attorney is effected. 11
In Orcino v. Gaspar, 12 we held that until a lawyer's withdrawal shall have been approved, he remains counsel of
record and is expected by his client as well as by the court to do what the interests of his client require. He must still appear
on the date of hearing for the attorney-client relation does not terminate formally until there is a withdrawal of his appearance
on record.
In this case, respondent admitted that he did not attend the January 6, 2003 hearing despite being notified by the
court. His claim that he was already discharged as counsel as early as October 25, 2002 is negated by the record that he
withdrew his appearance only on March 5, 2003. Until his dismissal or withdrawal was made of record, any judicial notice
sent to him was binding upon his client even though as between them the professional relationship may have been
terminated. 13 Thus, unless properly relieved, respondent is responsible for the conduct of the cases and his failure to attend
the hearing and comply with the trial court's directive to file a formal offer of evidence constitute inexcusable negligence.
Moreover, respondent's negligence is not excused by his claim that he had prepared his withdrawal of appearance
as early as October 30, 2002 but complainant refused to sign it. In Macarilay v. Seriña, 14 with similar facts, we rejected the
counsel's excuse for failing to file the complaints, although the complaints were finished, due to his client's refusal to sign
them.
Certainly not to be overlooked is the duty of an attorney to inform his client of the developments of the case. 15 We
note that it was only on May 5, 2003 that complainant learned that she defaulted in the case. As a lawyer mindful of the
interest of his client, respondent should have informed the complainant of the court's order addressed to him, especially if
he considered himself discharged in order for complainant and her new counsel to be guided accordingly.
The appropriate penalty on an errant lawyer depends on the exercise of sound judicial discretion based on the
surrounding facts. The penalties for a lawyer's failure to file a brief or other pleading range from reprimand, warning with
fine, suspension and, in grave cases, disbarment. 16 In this case, this Court sustains the recommendation of the IBP for
respondent's suspension of three months.
TAacCE
WHEREFORE, respondent Atty. Alfredo A. Zapanta is hereby found GUILTY of negligence and is meted the
penalty of SUSPENSION from the practice of law for THREE MONTHS effective upon finality of this Decision.
Let copies of this Decision be furnished the Office of the Bar Confidant to be appended to respondent's personal
record as an attorney, the Integrated Bar of the Philippines, the Department of Justice, and all courts in this country for their
information and guidance.
FIRST DIVISION
[A.C. No. 6711. July 3, 2007.]
MA. LUISA HADJULA, complainant, vs. ATTY. ROCELES F. MADIANDA, respondent.
DECISION
GARCIA, J : p
Under consideration is Resolution No. XVI-2004-472 of the Board of Governors, Integrated Bar of the Philippines
(IBP), relative to the complaint for disbarment filed by herein complainant Ma. Luisa Hadjula against respondent Atty.
Roceles F. Madianda.
The case started when, in an AFFIDAVIT-COMPLAINT 1 bearing date September 7, 2002 and filed with the IBP
Commission on Bar Discipline, complainant charged Atty. Roceles F. Madianda with violation of Article 209 2 of the
Revised Penal Code and Canon Nos. 15.02 and 21.02 of the Code of Professional Responsibility.
In said affidavit-complaint, complainant alleged that she and respondent used to be friends as they both worked
at the Bureau of Fire Protection (BFP) whereat respondent was the Chief Legal Officer while she was the Chief Nurse of
the Medical, Dental and Nursing Services. Complainant claimed that, sometime in 1998, she approached respondent for
some legal advice. Complainant further alleged that, in the course of their conversation which was supposed to be kept
confidential, she disclosed personal secrets and produced copies of a marriage contract, a birth certificate and a baptismal
certificate, only to be informed later by the respondent that she (respondent) would refer the matter to a lawyer friend. It
was malicious, so complainant states, of respondent to have refused handling her case only after she had already heard her
secrets.
Continuing, complainant averred that her friendship with respondent soured after her filing, in the later part of
2000, of criminal and disciplinary actions against the latter. What, per complainant's account, precipitated the filing was
when respondent, then a member of the BFP promotion board, demanded a cellular phone in exchange for the complainant's
promotion.
According to complainant, respondent, in retaliation to the filing of the aforesaid actions, filed a COUNTER
COMPLAINT 3 with the Ombudsman charging her (complainant) with violation of Section 3(a) of Republic Act No.
3019, 4 falsification of public documents and immorality, the last two charges being based on the disclosures complainant
earlier made to respondent. And also on the basis of the same disclosures, complainant further stated, a disciplinary case
was also instituted against her before the Professional Regulation Commission. ISCHET
Complainant seeks the suspension and/or disbarment of respondent for the latter's act of disclosing personal
secrets and confidential information she revealed in the course of seeking respondent's legal advice.
In an order dated October 2, 2002, the IBP Commission on Bar Discipline required respondent to file her answer
to the complaint.
In her answer, styled as COUNTER-AFFIDAVIT, 5 respondent denied giving legal advice to the complainant and
dismissed any suggestion about the existence of a lawyer-client relationship between them. Respondent also stated the
observation that the supposed confidential data and sensitive documents adverted to are in fact matters of common
knowledge in the BFP. The relevant portions of the answer read:
5. I specifically deny the allegation of F/SUPT. MA. LUISA C. HADJULA in paragraph 4 of her AFFIDAVIT-
COMPLAINT for reason that she never WAS MY CLIENT nor we ever had any LAWYER-CLIENT RELATIONSHIP that ever
existed ever since and that never obtained any legal advice from me regarding her PERSONAL PROBLEMS or PERSONAL
SECRETS. She likewise never delivered to me legal documents much more told me some confidential information or secrets. That
is because I never entertain LEGAL QUERIES or CONSULTATION regarding PERSONAL MATTERS since I know as a
LAWYER of the Bureau of Fire Protection that I am not allowed to privately practice law and it might also result to CONFLICT
OF INTEREST. As a matter of fact, whenever there will be PERSONAL MATTERS referred to me, I just referred them to private
law practitioners and never entertain the same, NOR listen to their stories or examine or accept any document.
9. I specifically deny the allegation of F/SUPT. MA. LUISA C. HADJULA in paragraph 8 of her AFFIDAVIT-
COMPLAINT, the truth of the matter is that her ILLICIT RELATIONSHIP and her illegal and unlawful activities are known in
the Bureau of Fire Protection since she also filed CHILD SUPPORT case against her lover . . . where she has a child . . . .
Moreover, the alleged DOCUMENTS she purportedly have shown to me sometime in 1998, are all part of public records
....
Furthermore, F/SUPT. MA. LUISA C. HADJULA, is filing the instant case just to get even with me or to force me to
settle and withdraw the CASES I FILED AGAINST HER since she knows that she will certainly be DISMISSED FROM
SERVICE, REMOVED FROM THE PRC ROLL and CRIMINALLY CONVICTED of her ILLICIT, IMMORAL, ILLEGAL and
UNLAWFUL ACTS.
On October 7, 2004, the Investigating Commissioner of the IBP Commission on Bar Discipline came out with
a Report and Recommendation, stating that the information related by complainant to the respondent is "protected under the
attorney-client privilege communication." Prescinding from this postulate, the Investigating Commissioner found the
respondent to have violated legal ethics when she "[revealed] information given to her during a legal consultation," and
accordingly recommended that respondent be reprimanded therefor, thus:
WHEREFORE, premises considered, it is respectfully recommended that respondent Atty. Roceles Madianda be
reprimanded for revealing the secrets of the complainant.
On November 4, 2004, the IBP Board of Governors issued Resolution No. XVI-2004-472 reading as follows: SDIACc
RESOLVED to ADOPT and APPROVE, as it is hereby ADOPTED and APPROVED, the Report and Recommendation
of the Investigating Commissioner of the above-entitled case, herein made part of this Resolution as Annex "A"; and, finding the
recommendation fully supported by the evidence on record and the applicable laws and rules, and considering the actuation of
revealing information given to respondent during a legal consultation, Atty. Roceles Madianda is hereby REPRIMANDED.
We AGREE with the recommendation and the premises holding it together.
As it were, complainant went to respondent, a lawyer who incidentally was also then a friend, to bare what she
considered personal secrets and sensitive documents for the purpose of obtaining legal advice and assistance. The moment
complainant approached the then receptive respondent to seek legal advice, a veritable lawyer-client relationship evolved
between the two. Such relationship imposes upon the lawyer certain restrictions circumscribed by the ethics of the
profession. Among the burdens of the relationship is that which enjoins the lawyer, respondent in this instance, to keep
inviolate confidential information acquired or revealed during legal consultations. The fact that one is, at the end of the day,
not inclined to handle the client's case is hardly of consequence. Of little moment, too, is the fact that no formal professional
engagement follows the consultation. Nor will it make any difference that no contract whatsoever was executed by the
parties to memorialize the relationship. As we said in Burbe v. Magulta, 6 —
A lawyer-client relationship was established from the very first moment complainant asked respondent for
legal advise regarding the former's business. To constitute professional employment, it is not essential that the client employed
the attorney professionally on any previous occasion.
It is not necessary that any retainer be paid, promised, or charged; neither is it material that the attorney
consulted did not afterward handle the case for which his service had been sought.
It a person, in respect to business affairs or troubles of any kind, consults a lawyer with a view to obtaining
professional advice or assistance, and the attorney voluntarily permits or acquiesces with the consultation, then the professional
employments is established.
Likewise, a lawyer-client relationship exists notwithstanding the close personal relationship between the
lawyer and the complainant or the non-payment of the former's fees.
Dean Wigmore lists the essential factors to establish the existence of the attorney-client privilege
communication, viz:
(1) Where legal advice of any kind is sought (2) from a professional legal adviser in his capacity as such, (3) the
communications relating to that purpose, (4) made in confidence (5) by the client, (6) are at his instance permanently protected
(7) from disclosure by himself or by the legal advisor, (8) except the protection be waived. 7
 With the view we take of this case, respondent indeed breached his duty of preserving the confidence of a client.
As found by the IBP Investigating Commissioner, the documents shown and the information revealed in confidence to the
respondent in the course of the legal consultation in question, were used as bases in the criminal and administrative
complaints lodged against the complainant.
The purpose of the rule of confidentiality is actually to protect the client from possible breach of confidence as a
result of a consultation with a lawyer.TcDaSI

The seriousness of the respondent's offense notwithstanding, the Court feels that there is room for compassion,
absent compelling evidence that the respondent acted with ill-will. Without meaning to condone the error of respondent's
ways, what at bottom is before the Court is two former friends becoming bitter enemies and filing charges and counter-
charges against each other using whatever convenient tools and data were readily available. Unfortunately, the personal
information respondent gathered from her conversation with complainant became handy in her quest to even the score. At
the end of the day, it appears clear to us that respondent was actuated by the urge to retaliate without perhaps realizing that,
in the process of giving vent to a negative sentiment, she was violating the rule on confidentiality.
IN VIEW WHEREOF, respondent Atty. Roceles F. Madianda is hereby REPRIMANDED and admonished to be
circumspect in her handling of information acquired as a result of a lawyer-client relationship. She is also STERNLY
WARNED against a repetition of the same or similar act complained of.