31.

32.
33. NOEMI ARANDIA, Complainant, v. ATTY. ERMANDO
MAGALONG, Respondent.

On July 16, 1999, complainant filed with this Court a complaint-affidavit charging
respondent of violating the CPR for making threats against her and her husband in
connection with complainant’s alleged debts to his client.

Complainant alleged that on August 26, 1997, she was summoned by respondent to his
office, where he threatened her that he would have her and her husband arrested if
they did not make good the checks they gave to respondent’s client, Jonelyn
Bastareche. Complainant averred that respondent’s actuations surprised her, since she
was not aware of any outstanding indebtedness on her or her husband’s part in favor of
Ms. Bastareche. On September 15, 1997, complainant received from respondent’s
secretary respondent’s August 26, 1997 letter addressed to a certain "SPO2
Bautista/warrant officer" requesting that the issuance of the warrant of arrest against
complainant and her husband be held in abeyance pending the ongoing negotiations
between them and his clients, the Bastareche spouses.

For fear that she and her husband would indeed be arrested by the police, complainant
obeyed respondent’s instructions to her and signed a document (Amicable Settlement)
before the Lupong Tagapamayapa of their barangay. Subsequently, when she verified
from the trial court whether there was a pending warrant of arrest against her,
complainant discovered that no such warrant was issued by the court. chanrobles.com : virtuallawlibrary

In his Comment, respondent claimed that complainant had an existing obligation to pay
his client, Jonelyn Bastareche, P200,000.00, the amount corresponding to the two
bouncing checks which she had earlier rediscounted to Bastareche. Respondent
contended that after Bastareche’s and respondent’s efforts to collect the said amount
from complainant failed, they decided to file a criminal case for violation of Batas PB.
22. He instructed his client to go to the police investigator and file a sworn complaint
against complainant.

Respondent said that he was not able to talk to Bastareche for about a week after he
instructed her to file the complaint. He further alleged that on August 26, 1997,
complainant went to his office and submitted a proposal to settle the dispute between
her and Bastareche. Respondent informed complainant that about a week ago, he
ordered Bastareche to file a complaint against her. Upon hearing this, complainant
insisted that her proposal be relayed immediately to Bastareche, and that the warrant
of arrest against her, if such had already been issued, be held in abeyance. Believing
that Bastareche had already filed a complaint against complainant, respondent wrote
the letter addressed to "SPO2 Bautista/warrant officer" requesting that the issuance of
the warrant of arrest be held in abeyance. 4
On October 25, 1999, the Court referred the case to the (IBP) for investigation, report
and recommendation. 5

In a letter dated March 20, 2000, the Atty. Victor C. Fernandez, IBP Director for Bar
Discipline, submitted to the Court a Notice of Resolution and the Records of the case.
The Resolution of the Board of Governors, adopting the recommendation of the
commissioner that the case against Respondent is DISMISSED for lack of merit.
virtua1 1aw 1ibrary
chanrob1es

Complainant filed a MR of the IBP’s resolution. She alleged that she was not furnished a
copy of said resolution and that it was respondent who gave her a copy thereof.
Complainant further claimed that she did not receive a copy of the Answer filed by
respondent with the IBP.

On August 16, 2000, the Court required respondent to comment on complainant’s

motion.

On September 16, 2000, respondent filed his Comment and Manifestation whereby he
informed the Court that he was adopting the Comment which he submitted to the
Investigating Commissioner of the IBP on September 28, 1999.

It appears that the report and recommendation of the IBP was based merely on the
Original Rollo of the case which was sent by the Court to the IBP pursuant to
its October 25, 1999 resolution. No hearing was conducted to determine the
veracity of complainant’s and respondent’s respective allegations.

WON conduct of hearing is required

In Baldomar v. Paras, 6 the Court held: chanrob1es virtual 1aw library

Complaints against lawyers for misconduct are normally addressed to the

Court. If, at the outset, the Court finds a complaint to be clearly wanting in
merit, it outrightly dismisses the case. If, however, the Court deems it
necessary that further inquiry should be made, such as when the matter could
not be resolved by merely evaluating the pleadings submitted, a referral is
made to the IBP for a formal investigation of the case during which the parties
are accorded an opportunity to be heard. An ex parte investigation may only
be conducted when respondent fails to appear despite reasonable notice. . . . 7
(Emphasis supplied.)

It must be emphasized that a formal investigation is a mandatory requirement

which may not be dispensed with except for valid and compelling reasons. 8
Thus, Rule 139-B of the Revised Rules of Court which outlines the procedure
for disbarment and disciplinary cases against members of the Bar, directs an
investigator or a panel of investigators appointed as such by the IBP Board of
Governors to investigate all complaints referred by said body to him, or to the
panel, as the case may be. In conducting an investigation, the investigator or
investigating panel must comply with the following: chanrob1es virtual 1aw library

Sec. 5. Service or dismissal. — If the complaint appears to be meritorious, the

Investigator shall direct that a copy thereof be served upon the respondent, requiring
him to answer the same within fifteen (15) days from the date of service. If the
complaint does not merit action, or if the answer shows to the satisfaction of the
Investigator that the complaint is not meritorious, the same may be dismissed by the
Board of Governors upon his recommendation. A copy of the resolution of dismissal
shall be furnished the complainant and the Supreme Court which may review the case
motu proprio or upon timely appeal of the complainant filed within 15 days from notice
of the dismissal of the complaint. chanrob1es virtua1 1aw 1ibrary

"No investigation shall be interrupted or terminated by reason of the desistance,

settlement, compromise, restitution, withdrawal of the charges, or failure of the
complainant to prosecute the same.

"x       x       x

"Sec. 8. Investigation. — Upon joinder of issues or upon failure of the respondent to

answer, the Investigator shall, with deliberate speed, proceed with the investigation of
the case. He shall have the power to issue subpoenas and administer oaths. The
respondent shall be given full opportunity to defend himself, to present witnesses on his
behalf and be heard by himself and counsel. However, if upon reasonable notice, the
respondent fails to appear, the investigation shall proceed ex parte.

The Investigator shall terminate the investigation within three (3) months from the date
of its commencement, unless extended for good cause by the Board of Governors upon
prior application.

Willful failure or refusal to obey a subpoena or any other lawful order issued by the
Investigator shall be dealt with as for indirect contempt of Court. The corresponding
charge shall be filed by the Investigator before the IBP Board of Governors which shall
require the alleged contemnor to show cause within ten (10) days from notice. The IBP
Board of Governors may thereafter conduct hearings, if necessary, in accordance with
the procedure set forth in this Rule for hearings before the Investigator. Such hearing
shall as far as practicable be terminated within fifteen (15) days from its
commencement. Thereafter, the IBP Board of Governors shall within a period of fifteen
(15) days issue a resolution setting forth its findings and recommendations, which shall
forthwith be transmitted to the Supreme Court for final action and if warranted, the
imposition of penalty.
chanrob1es virtua1 1aw 1ibrary

The Court finds that the conduct of a formal investigation is necessary for the
proper resolution of the instant case.

WHEREFORE, the instant administrative case is hereby REMANDED to the Integrated

Bar of the Philippines for further proceedings. chanrob1es virtua1 1aw 1ibrary

SO ORDERED.

Case 34. JUDGE NIMFA P. SITACA, COMPLAINANT, VS. ATTY. DIEGO M.

PALOMARES, RESPONDENT.
 DECISION
VITUG, J.:
Judge Nimfa Penaco-Sitaca seeks the disbarment of Atty. Diego M. Palomares, Jr., for having
filed a falsified bail bond.

Judge Nimfa Penaco-Sitaca was the Acting Presiding Judge of Branch 35 of the RTC of Ozamis
City. Among the cases in her sala was Criminal Case for murder against Dunhill Palomares, a
son of Atty. Diego M. Palomares, Jr., herein respondent. Sometime in September 1997, Atty.
Palomares, in representation of Dunhill, filed a bail bond of P200,000.00 to secure the latter’s
release. The bail bond was purportedly signed and approved by the late Judge Nazar U.
Chavez, then Presiding Judge of RTC Branch 18 of Cagayan de Oro City, and with it was a
corresponding order of release signed by RTC Branch 18 Clerk of Court Atty. Glenn Peter C.
Baldado. When informed of the filing by Atty. Palomares of the bail bond, ostensibly signed by
Judge Chavez, Judge Sitaca approved the release of the accused.

When RTC Clerk of Court Atty. Roy P. Murallon later requested Atty. Baldado to forward to the
Ozamis City RTC the original records and supporting documents on the bail bond, Atty.
Baldado, by then already a practicing lawyer, disavowed the existence of the bail bond. Atty.
Baldado wrote to say that per the official records of Cagayan de Oro RTC, Branch 18, the bail
bond did not exist, that no approval was made by Judge Chavez, and that no order for the
release of Dunhill was issued. Atty. Baldado concluded that the bail bond was a forged
document.

Judge Sitaca directed Atty. Palomares to explain. In his letter to Judge Sitaca, Atty.
Palomares stated that he was the corporate legal counsel of Bentley House International
Corporation, and when the bail application was approved for P200,000.00, he requested the
amount from Jonathon Stevenz and Cristina Q. Romarate, Chief Operations Officer and
Treasurer, respectively, of Bentley House International Corporation. Instead of giving the
money, Stevenz and Romarate proposed to utilize the services of William Guialani. He
acceded. Guialani then delivered the release order, which Atty. Palomares immediately
presented to the Branch 35 clerk of court of RTC Ozamis City. The clerk of court read the
release order and then issued the corresponding order for the release of Dunhill Palomares.
Atty. Palomares denied any wrongdoing in connection with the submission of the falsified bail
bond and offered, in any event, to replace the bail bond with a cash bond.

Judge Sitaca, finding the explanation unsatisfactory, filed disbarment proceedings against
Atty. Palomares.

iss
The Court, in its 02nd August 2000 resolution, required Atty. Palomares to comment on the
complaint for disbarment. In his comment, Atty. Palomares reiterated his previous explanation
to Judge Sitaca. In addition, he intimated that Judge Sitaca was covering up for the
negligence of her clerk of court. He claimed that Judge Sitaca was not around when the
release order was issued because it was a Saturday and only a skeletal force was in the
office. Atty. Palomares said that he had asked the help of Atty. Manuel Ravanera to prove that
the bail bond was secured by Guialani who could have possibly been in “cahoots” with some
court employees.

In its resolution of 19 March 2003, the Court referred the case to the Integrated Bar of the
Philippines (IBP) for investigation, report and recommendation.

In a Report and Recommendation, dated 24 July 2003, Commissioner Milagros V. San Juan
held that there was no doubt that the bail bond and order of release were "fictitious.” She
stated that while there was no conclusive proof that Atty. Palomares had been the author of
the fictitious bail and release order, it could not be denied, however, that it was he who
presented the papers to the court. Atty. Palomares failed to satisfactorily explain, she stated,
why he had to take a circuitous route and secure the services of Guialani despite his claim
that he could have easily availed himself of the facilities of other insurance companies. She
recommended that Atty. Palomares be suspended from the practice of law for a period of
eighteen (18) months. The recommendation was adopted by the IBP Board of Governors on 30
August 2003 in its Resolution No. XVI-2002-81.

WON there is proper investigation that warrants the disbarment case

Held

In this case, it would appear that no investigation, not even just an  ex-parte investigation,
was conducted by the Commission on Bar Discipline.

The prevailing procedure for investigation is that expressed in Rule 139-B of the Rules of Court
some pertinent provisions of which read:
“SEC. 3. Duties of the National Grievance Investigator. – The National Grievance Investigators
shall investigate all complaints against members of the Integrated Bar referred to them by the
IBP Board of Governors.

“x x x     x x x     x x x

“SEC. 5. Service or dismissal. – If the complaint appears to be meritorious, the Investigator

shall direct that a copy thereof be served upon the respondent, requiring him to answer the
same within fifteen (15) days from the date of service. If the complaint does not merit action,
or if the answer shows to the satisfaction of the Investigator that the complaint is not
meritorious, the same may be dismissed by the Board of Governors upon his recommendation.
A copy of the resolution of dismissal shall be furnished the complainant and the Supreme
Court which may review the case motu proprio or upon timely appeal of the complainant filed
within 15 days from notice of the dismissal of the complaint.

“No investigation shall be interrupted or terminated by reason of the desistance, settlement,

compromise, restitution, withdrawal of the charges, or failure of the complainant to prosecute
the same.

“x x x     x x x     x x x

“SEC. 8. Investigation. – Upon joinder of issues or upon failure of the respondent to answer,
the Investigator shall, with deliberate speed, proceed with the investigation of the case. He
shall have the power to issue subpoenas and administer oaths. The respondent shall be given
full opportunity to defend himself, to present witnesses on his behalf and be heard by himself
and counsel. However, if upon reasonable notice, the respondent fails to appear, the
investigation shall proceed ex parte.

“The Investigator shall terminate the investigation within three (3) months from the date of its
commencement, unless extended for good cause by the Board of Governors upon prior
application.

“Willful failure to refusal to obey a subpoena or any other lawful order issued by the
Investigator shall be dealt with as for indirect contempt of court. The corresponding charge
shall be filed by the Investigator before the IBP Board of Governors which shall require the
alleged contemnor to show cause within ten (10) days from notice. The IBP Board of
Governors may thereafter conduct hearings, if necessary, in accordance with the procedure
set forth in this Rule for hearings before the Investigator. Such hearing shall as far as
practicable be terminated within fifteen (15) days from its commencement. Thereafter, the IBP
Board of Governors shall within a like period of fifteen (15) days issue a resolution setting
forth its findings and recommendations, which shall forthwith be transmitted to the Supreme
Court for final action and if warranted, the imposition of penalty.”

The Court must call for the due observance of the foregoing rules, and it is thus constrained to
remand the case to the IBP for further proceedings.

WHEREFORE, the instant administrative case is REMANDED to the Integrated Bar of the
Philippines for further proceedings; it is also directed to act on this referral with dispatch.

SO ORDERED.

Case 35 ERLINDA K. ILUSORIO-BILDNER v. ATTY. LUIS K. LOKIN, JR., et

al.

477 SCRA 634 (2005)

A lawyer is prohibited from representing an interest contrary to that earlier espoused

by his firm.

Erlinda K. Ilusorio-Bildner filed a disbarment complaint against Atty. Luis Lokin, Jr..

This sprung from the time that her father, the late Potenciano Ilusorio, engaged the
services of the law office of Lokin to represent him in the Sandiganbayan where the
Republic was claiming, among other properties, shareholdings in Philippine Overseas
Telecommunications Corporation (POTC) and Philippine Communications Satellite
Corporation (PHILCOMSAT).

Ilusorio, with the assistance of Lokin, entered into a Compromise Agreement where

Ilusorio was to get 673 POTC shares. Ilusorio-Bildner alleges that the informal
gathering, through the “high-handed and deceitful maneuvers” of Lokin, was suddenly
and without notice transformed into a Special Stockholders Meeting at which directors
and officers of PHILCOMSAT were elected. Her father contested the validity of the
meeting by filing before the Securities and Exchange Commission (SEC) against Manuel
Nieto, et al. who were purportedly elected directors and officers of PHILCOMSAT, in
which SEC case Lokin appeared as the counsel of Nieto, et al., contrary to his oath not to
represent conflicting interests.

Ilusorio, had earlier filed with the IBP a disbarment complaint. However, on account of

the death of Ilusorio, his complaint was dismissed without prejudice to the filing of a
new complaint by Ilusorio’s children. Ilusorio-Bildner now filed the complaint but the
IBP Board of Governors dismissed it. No copy of the notice of resolution was served
upon petitioner. Ilusorio-Bildner, nonetheless, learned about the matter.
ISSUE:

Whether or not Lokin was personally barred by the rules of ethics from representing an
interest contrary to that earlier espoused by his firm

HELD:

Notwithstanding his acknowledged involvement in both the Sandiganbayan and SEC

cases, respondent denies that he was guilty of representing conflicting interests, he
proffering that, in the first place, the case of Ilusorio in the Sandiganbayan “has been the
personal account of Atty. Raval, separate and apart from the accounts of the law
partnership.” Not only is this claim unsubstantiated, however. It is contradicted by
respondent’s own evidence and statements.

As earlier noted, respondent has stated that Ilusorio was represented by his firm in the
Sandiganbayan case. In light thereof, respondent was personally barred by the rules of
ethics from representing an interest contrary to that earlier espoused by his firm.

Plainly, when Lokin represented Nieto, et al. in the SEC, he was advocating an interest
hostile to the implementation of the same Compromise Agreement that he had priorly
negotiated for Ilusorio.

The Board thus erred when, while acknowledging that Ilusorio was represented by
respondent’s firm in his negotiations with the PCGG, it nonetheless maintained that
there was no conflict of interest upon a finding that the subsequent SEC case “did not in
any way involve the validity of the compromise agreement forged with the PCGG.”