THE LAWYER AND THE CLIENT

When does a lawyer-client relationship begin?

“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. If 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.” (Burbe vs. Magulta, A.C. No. 99-
634)

CANON 14 - A LAWYER SHALL NOT REFUSE HIS SERVICES TO THE NEEDY.

Rule 14.01 - A lawyer shall not decline to represent a person solely on account of the
latter's race, sex. creed or status of life, or because of his own opinion regarding the
guilt of said person.

A lawyer is not bound to accept every case that is referred to him. He must on his own
responsibility decide what business he will accept as counsel, what cases he will bring to
court for plaintiffs, or what cases he will contest in court for defendants.

However, the lawyer cannot decline to represent a person for the SOLE reason of the
latter’s (1) race, (2) sex, (3) creed, (4) status in life, or (5) because of the lawyer’s opinion
that said person is guilty of the charge.

As stated in par. e, Sec. 20, Rule 13 of the Rules of Court, “ In the defense of a person
accused of crime, by all fair and honorable means, regardless of his personal opinion as to
the guilt of the accused, to present every defense that the law permits, to the end that no
person may be deprived of life or liberty, but by due process of law.”

Rule 14.02 - A lawyer shall not decline, except for serious and sufficient cause, an
appointment as counsel de officio or as amicus curiae, or a request from the Integrated
Bar of the Philippines or any of its chapters for rendition of free legal aid.

COUNSEL DE OFICIO – a counsel, appointed by the court from among such members of the
bar in good standing who, by reason of their experience and ability, may adequately defend
the accused.

The duty to appoint a counsel de oficio rests upon the presiding judge. If an accused
appears without counsel, it is the duty of the judge to inform him that under the
Constitution, it is his right to have an attorney represent him. The accused must be asked
before arraignment whether he desires the aid of an attorney. If he desires but is unable to
employ one, the court must assign a counsel de oficio to defend him. However, if accused

Chapter IV – The Lawyer and The Client Page 1

wants to defend himself without counsel, the judge may allow him to go to trial without
counsel but he cannot later claim he was not accorded due process for lack of counsel. A
counsel de oficio is appointed only for a defendant in a criminal case.

AMICUS CURIAE (Latin word meaning “friend of the court”) - an advisor to the court on
some matter of law who is not a party to the case, someone who is known to be an expert
or knowledgeable on certain matters of law in regard to which the judge may be doubtful
or might go wrong.

An appointment as amicus curiae could either be by application to the judge or the judge on
his own initiative may invite a prominent lawyer to appear as amicus curiae in special
cases (Rule 138, Section 36 of the Rules of Court). The impartiality of the lawyer must be
considered by the judge before making the appointment or invitation.

The amicus curiae does not have the right to interfere with or control the condition of the
record; he has no control over the suit and no right to institute any proceedings therein and
cannot assume the functions of a party in an action or proceedings before the court;
ordinarily, he cannot file a pleading in a cause. (In Re: Quirino, G.R. No. L-278)

FREE LEGAL AID ON REQUEST OF THE IBP

The Integrated Bar of the Philippines (IBP) which is the national association of lawyers, or
any of its chapters may request a member of the Bar to render free legal aid to poor
deserving litigants. This is different from an appointment of a counsel de oficio. A counsel
de oficio is appointed to defend an accused in a criminal case while the request to render
free legal advice to an attorney may refer to any party in any case other than a criminal
case where the services of counsel are needed to secure the ends of justice.

The basic policy of the IBP on legal aid is that – “Legal aid is not a matter of charity. It is a
means for the correction of social imbalance that may and often lead to injustice, for which
reason it is a public responsibility of the Bar. The spirit of public service should therefore
underlie all legal aid offices. The same should be administered to indigent and deserving
members of the community in all cases, matters and situations in which legal aid may be
necessary to forestall an injustice.” (Art.1, Sec. 1, Guidelines Governing the Establishment
and Operation of Legal Aid Officers in Chapters of the Integrated Bar of the Philippines)

Rule 14.03 - A lawyer may not refuse to accept representation of an indigent client if:

(a) he is not in a position to carry out the work effectively or competently;

(b) he labors under a conflict of interest between him and the prospective client or
between a present client and the prospective client.

COVERAGE OF THE RULE: The Rule involves indigent clients who come to a lawyer for
legal services. An indigent client is one who is poor and cannot afford to pay for a lawyer.

The lawyer shall not refuse to accept his engagement by a poor client for reasons of
insufficient compensation or lack of it. The practice of law is a special privilege to which
certain responsibilities and obligations are inherently attendant, among which, is the

Chapter IV – The Lawyer and The Client Page 2

lawyer’s social obligation to render free legal service to the destitutes of society who
cannot afford to hire the services of lawyers.

Rule 14.04 - A lawyer who accepts the cause of a person unable to pay his
professional fees shall observe the same standard of conduct governing his relations
with paying clients.

If a lawyer accepts a case for a client and the client is unable to pay the lawyer’s
professional fees, he must still represent the client with utmost fidelity, competence and
diligence. The profession is not a money-raking trade but a noble involvement in the
administration of justice.

CANON 15 - A LAWYER SHALL OBSERVE CANDOR, FAIRNESS AND LOYALTY IN ALL HIS
DEALINGS AND TRANSACTIONS WITH HIS CLIENTS.

Rule 15.01. - A lawyer, in conferring with a prospective client, shall ascertain as soon
as practicable whether the matter would involve a conflict with another client or his
own interest, and if so, shall forthwith inform the prospective client.

Lawyers are prohibited from representing conflicting interests in a case. The respondent’s
act of appearing and acting as counsel for the complainants in the civil case against the
Philippine National Bank, that had appointed him bank attorney and notary public
constitutes malpractice. (Mejiah vs. Reyes, 4 SCRA 648)

In case of conflict of interests of a lawyer and his client, the lawyer shall give preference to
the client’s interests. (Sta. Maria vs. Tuason, 11 SCRA 562)

Rule 15.02.- A lawyer shall be bound by the rule on privilege communication in

respect of matters disclosed to him by a prospective client.

Two-fold Purpose of the Rule

1. To encourage a client to make a full disclosure of the facts of the case to his
counsel without fear; and
2. To allow the lawyer freedom to obtain full information from his client.

Basic Limitations
1. The communication or the physical object must have been transmitted to the
counsel by the client for the purpose of seeking legal advice.
2. The privilege is limited or has reference only to communications which are within
the ambit of lawful employment and does not extend to those transmitted in
contemplation of future crimes or frauds.

Instances When the Privilege Ceases

1. Contents of the pleadings cease to become privileged communications after the
pleading have been filed.

Chapter IV – The Lawyer and The Client Page 3

 2. A communication intended by the client to be sent to a third person through his
counsel loses its confidential character as soon as it has reached the hands of the
third person.

Requisites of the Privileged Communication Rule

a. There exists an attorney and client relationship or a kind of consultancy relationship
with a prospective client;
b. The communication was made by the client to the lawyer in the course of the
lawyer’s professional employment; and
c. The communication must be intended to be confidential.

Dean Wigmore lists the essential factors to establish the existence of the attorney-client
privilege communication, which are: (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. (Hadjula vs. Madianda, A.C. No. 6711)

Duration of the Privileged Communication

The privilege continues to exist even after the termination of the attorney-client
relationship. It outlasts the lawyer’s engagement. The privileged character of the
communication ceases only when waived by the client himself or after his death, by his heir
or legal representative.

Rule 15.03. - A lawyer shall not represent conflicting interests except by written
consent of all concerned given after a full disclosure of the facts.

Test of Inconsistency
The test is whether or not in behalf of one client, it is the lawyer’s duty to fight for an issue
or claim but it his duty to oppose it for the other client.

When Authorized
The lawyer may appear against his own client only on the condition that the client has
given his written consent thereto and after full disclosure of the facts to him. (Bautista vs.
Gonzales, 182 SCRA 164)

Rationale: The rule aims not only to bar the dishonest practitioner from the fraudulent
conduct but also to prevent the honest practitioner from putting himself in the position
where he may be required to choose conflicting interests. It is designed to prevent the
honest lawyer from attempting to reconcile conflicting interests rather than to enforce to
the full extent the rights or the interest which he should alone represent.

Rule 15.04. - A lawyer may, with the written consent of all concerned, act as
mediator, conciliator or arbitrator in settling disputes.

Rationale: Consent in writing is required to prevent future controversy on the authority of

the lawyer to act as mediator, conciliator of arbitrator. However, a lawyer who acts as
mediator, conciliator or arbitrator in settling a dispute, cannot represent any of the parties.

Chapter IV – The Lawyer and The Client Page 4

 Rule 15.05. - A lawyer when advising his client, shall give a candid and honest
opinion on the merits and probable results of the client's case, neither overstating nor
understating the prospects of the case.

A lawyer should give an honest opinion as to the probable results of the case, with the end
in view of promoting respect for the law and the legal processes.

Rule 15.06. - A lawyer shall not state or imply that he is able to influence any public
official, tribunal or legislative body.

This rule protects against influence peddling. Some prospective clients secure the services
of a particular lawyer or law firm precisely because he can exert a lot of influence on a
judge and some lawyers exact big fees for such influence.

Rule 15.07. - A lawyer shall impress upon his client compliance with the laws and the
principles of fairness.

The Code of Professional Responsibility enjoins a lawyer to employ only fair and honest
means to attain the lawful objectives of his client and warns him not to allow his client to
dictate procedure in handling the case.

A lawyer should comply with the client’s lawful requests. But he should resist and should
never follow any unlawful instructions. In matters of law, it is the client who should yield
to the lawyer and not the other way around.

A lawyer must also observe and advice his client to observe the statute law, thought until a
statute shall have been construed and interpreted by competent jurisdiction, he is free and
is entitled to advice as to its validity and as to what he conscientiously believes to be its just
meaning and extent.

Rule 15.08. - A lawyer who is engaged in another profession or occupation

concurrently with the practice of law shall make clear to his client whether he is acting
as a lawyer or in another capacity.

Exercise of dual profession is not prohibited but a lawyer must make it clear when he is
acting as a lawyer and when he is otherwise, especially in occupations related to the
practice of law. Reason: certain ethical considerations may be operative in one profession
and not in the other.

A lawyer is not barred from dealing with his client but the business transaction must be
characterized with utmost honesty and good faith. Representation of conflicting interests
may be allowed where the parties give an informed consent to the representation after full
disclosure of facts. The lawyer must explain to his clients the nature and extent of the
conflict and the possible adverse effects must be thoroughly understood by his clients. The
test to determine whether there is conflict of interest in the representation is the
probability, not the certainty of conflict. (Nakpil v. Valdez, 286 SCRA 758)

Chapter IV – The Lawyer and The Client Page 5

CANON 16 - A LAWYER SHALL HOLD IN TRUST ALL MONEYS AND PROPERTIES OF HIS
CLIENT THAT MAY COME INTO HIS PROFESSION.

Art. 1491(5) Civil Code. The following persons cannot acquire by purchase, even at a
public auction, wither in person or through the mediation of another: (5) Justices, judges,
prosecuting attorneys, clerks of superior and inferior courts, and other officers and
employees connected with the administration of justice, the property and rights in
litigation or levied upon an execution before the court within whose jurisdiction or
territory they exercise their respective functions; this prohibition includes the act of
acquiring by assignment and shall apply to lawyers, with respect to the property and tights
which may be the object of any litigation in which they may take part by virtue of their
profession.

Elements of Art. 1491:

1. Property or interest is in litigation
2. Attorney takes part as counsel in the case involving said property
3. Purchase, acquisition by attorney, by himself or through another of the property in
litigation, during the pendency of the case.

Purchase includes mortgage of property in litigation to lawyer. In this case, acquisition is

merely postponed until foreclosure but the effect is the same.

Application of the Rule

When all the following four elements are present there is a violation of law and ethically
improper conduct:
1. there must be attorney-client relationship
2. the property or interest of the client must be in litigation
3. the attorney takes part as counsel in the case
4. the attorney himself or through another purchases such property or interest during
the pendency of the litigation

When the Rule is Inapplicable

The absence of one element renders prohibition inapplicable (e.g. an attorney may bid on
behalf of his client at the auction sale of the client’s property in litigation since it is not for
his own benefit)

Contingent Fee Contract - a contract which states that a certain amount of money or fee
will be paid to a lawyer only if there is a successful conclusion of the legal work, usually
winning or settling a lawsuit in favor of the client, or collecting funds due with or without
filing a lawsuit. This is allowed since it neither gives nor purports to give to the attorney an
absolute right, personal or real, in the subject matter during the pendency of the litigation;
the measure of compensation provided is a mere basis for the computation of fees and the
payment made from the proceeds of the litigation is effected only after its successful
termination. A distinction must be made between purchasing an interest in the litigation to
enable a lawyer to litigate on his own account or to abuse the client’s confidence
(prohibited) and accepting compensation contingent upon the result of the litigation
(allowed). Note, however, that a contingent fee contract which is unreasonable ceases to be
a measure of due compensation for services rendered.

Chapter IV – The Lawyer and The Client Page 6

Effects of Prohibited Purchase
1. A prohibited purchase is null and void ab initio; public interest and public policy
dictate that its nullity is definite and permanent and cannot be cured by ratification.
The lawyer will be deemed to hold the property in trust for the client.
2. The client is therefore entitled to recover property and interest from his attorney
with the fruits. The client should, however, return the purchase price and the legal
interests.

Rule 16.01 - A lawyer shall account for all money or property collected or received
for or from the client.

A lawyer holds money or property, which he received from or for his client, in trust and
should promptly make an accounting thereof. If money or property entrusted was not used
for its purpose, it should be returned immediately to the client. Failure to return would
raise presumption that he misappropriated the money/property.

Money received by a lawyer from a person who is not his client is also held by him in trust
and he is under obligation to account for it.

The circumstance that a lawyer has a lien for his attorney’s fees over the client’s money in
his possession does not relieve him from the obligation to make a prompt accounting and
his failure to do so constitutes professional misconduct.

“In the present case, respondent collected money from the complainant and the nephew of
the detained person in the total amount of P64,000 for the immediate release of the
detainee through his alleged connection with a Justice of the Supreme Court. Not only that,
respondent even had the audacity to tell complainant that the Justices of the Supreme
Court does not accept checks. As with other cases against him, respondent has
demonstrated a penchant for misrepresenting to clients that he has the proper connections
to secure the relief they seek, and thereafter, ask for money, which will allegedly be given
to such connections. In so doing, respondent placed the Court in dishonor and public
contempt. He deserves to be disbarred from the practice of law.” (Berbano v. Barcelona,
410 SCRA 258)

“A lawyer, under his oath, pledges himself not to delay any man for money or malice and is
bound to conduct himself with all good fidelity to his clients. He is obligated to report
promptly the money of his clients that has come into his possession (otherwise a violation
of Sec. 25, Rule 138 of ROC). He should not commingle it without his client’s consent. He
should maintain a reputation for honesty and fidelity to private trust. The fact that a lawyer
has a lien for fees on money in his hands would not relieve him from the duty of promptly
accounting for the funds received. (Daroy v. Legaspi (1975)

Rule 16.02 - A lawyer shall keep the funds of each client separate and apart from his
own and those of others kept by him.

A lawyer should keep funds of each client separate and apart from his own. He should not
use client’s money for personal purposes without client’s consent. He should report
promptly the money of his client in his possession.

Chapter IV – The Lawyer and The Client Page 7

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

Rule 138, Sec. 37. Attorney’s liens.—An attorney shall have a lien upon the funds,
documents and papers of his client which have lawfully come into his possession and may
retain the same until his lawful fees and disbursements have been paid, and may apply
such funds to the satisfaction thereof. He shall also have a lien to the same extent upon all
judgments for the payment of money, and executions issued in pursuance of such
judgments, which he has secured in a litigation of his client, from and after the time when
he shall have caused a statement of his claim of such lien to be entered upon the record of
the court rendering such judgment, or issuing such execution, and shall have caused
written notice thereof to be delivered to his client 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.

In general, a lien is a security interest used by a creditor to ensure payment by a debtor for
money owed. Since an attorney is entitled to payment for services performed, the attorney
has a claim on a client's property until compensation is duly made.

If client agrees with lawyer as to the amount of attorney’s fees and as to the application of
the client’s fund to pay his lawful fees and disbursement, a lawyer may deduct what is due
him and remit the balance to his client. If no such agreement or consent or if there is
dispute or disagreement as to the fees, he should return everything to client without
prejudice to his filing a case to recover his unsatisfied fees.

This rule grants the lawyer a lien over the client’s funds in his possession as well as on all
judgments and executions he has secured for his client, to satisfy his lawful fees and
disbursements.

Money collected by a lawyer in pursuance of a judgment in favor of his clients is held in

trust and must be immediately turned over to them. (Businos v. Ricafort, 283 SCRA 40)

“After a decision favorable to Atty. Robinol’s clients and he had received the latter's funds,
suddenly, he had a change of mind and decided to convert the payment of his fees from a
portion of land equivalent to that of each of the plaintiffs to P 50,000, which he alleges to be
the monetary value of that area. Certainly, Atty. Robinol had no right to unilaterally
appropriate his clients' money not only because he is bound by a written agreement but
also because, under the circumstances, it was highly unjust for him to have done so. His
clients were mere squatters who could barely eke out an existence Atty. Robinol has no
basis to claim that since he was unjustly dismissed by his clients he had the legal right to
retain the money in his possession. Firstly, there was justifiable ground for his discharge as
counsel- his clients had lost confidence in him. Secondly, even if there were no valid
ground, he is bereft of any legal right to retain his clients' funds intended for a specific
purpose the purchase of land. He stands obliged to return the money immediately to their
rightful owners. The principle of quantum meruit applies if a lawyer is employed without a

Chapter IV – The Lawyer and The Client Page 8

price agreed upon for his services in which case he would be entitled to receive what he
merits for his services, as much as he has earned. In this case, however, there was an
express contract and a stipulated mode of compensation. The implied assumption on
quantum meruit therefore, is inapplicable. (Quilban v. Robinol, 171 SCRA 768)

Rule 16.04 - A lawyer shall not borrow money from his client unless the client's
interest are fully protected by the nature of the case or by independent advice. Neither
shall a lawyer lend money to a client except, when in the interest of justice, he has to
advance necessary expenses in a legal matter he is handling for the client.

Champerty — a bargain by a stranger (the lawyer) with a party to a suit (the client) by
which such third person undertakes to carry on the litigation at his own expense and risk,
in consideration of receiving, if successful, a part of the proceeds or subject sought to be
recovered.

Champertous Contract — where the lawyer assumes all expenses of litigation and
reimbursement is contingent on outcome of case is PROHIBITED. Champertous contracts
are like wagers—the lawyer gets paid and reimbursed if he wins the case and loses even
what he had spent on the case if he loses.

Contingent Fee Contract — in this, the lawyer gets reimbursed for any advances made for
the client in the course of the representation, whether he wins the suit or not; only the
amount of attorney’s fees is contingent upon winning.

The relation of attorney and client is highly fiduciary in nature and is of a very delicate,
exacting and confidential character. A lawyer is duty-bound to observe candor, fairness and
loyalty in all his dealings and transactions with his clients. The profession, therefore,
demands of an attorney an absolute abdication of every personal advantage conflicting in
any way, directly or indirectly, with the interest of his client. (Barnachea v. Quicho, 399
SCRA 1)

CANON 17 - A LAWYER OWES FIDELITY TO THE CAUSE OF HIS CLIENT AND HE SHALL BE
MINDFUL OF THE TRUST AND CONFIDENCE REPOSED IN HIM.

When a lawyer takes a client’s cause, he thereby covenants that he will exert all effort for
its prosecution until its final conclusion. The failure to exercise due diligence or the
abandonment of a client's cause makes such lawyer unworthy of the trust which the client
had reposed on him.

A lawyer has a duty to protect with utmost dedication the interest of his client and of the
fidelity, trust and confidence which he owes his client. More so where by reason of his
gross negligence his client thereby suffered by losing all his cases.

Lawyers should be fair, honest, respectable, above suspicion and beyond reproach in
dealing with their clients. The profession is not synonymous with an ordinary business
proposition. It is a matter of public interest. (Cantiller v. Potenciano, 180 SCRA 246)

Chapter IV – The Lawyer and The Client Page 9

It is the duty of a lawyer at the time of retainer to disclose to the client all the
circumstances of his relations to the parties, and any interest in or connection with the
controversy, which might influence the client in the selection of counsel.

It is unprofessional to represent conflicting interests, except by express consent of all

concerned given after a full disclosure of the facts. Within the meaning of this canon, a
lawyer represents conflicting interests when, in behalf of one client, it is his duty to
contend for that which duty to another client requires him to oppose.

A lawyer should champion his cause with that wholehearted fidelity, care and devotion that
he is obligated to give to every case that he accepts from a client. (Alisbo v. Jalandoon,
199 SCRA 321)

RELATED PROVISIONS:
Rule 138, Sec. 20 (e): To maintain inviolate the confidence, and at every peril to himself,
to preserve the secrets of his client, and to accept no compensation in connection with his
client's business except from him or with his knowledge and approval.

Rule 138, Sec. 20 (f): To abstain from all offensive personality and to advance no fact
prejudicial to the honor or reputation of a party or witnesses, unless required by the justice
of the cause with which he is charged.

Furnishing the adverse parties with evidence against the client constitutes betrayal of trust
and confidence of his former clients in violation of Rule 138, Sec. 20 (e). (Ngayan v. Tugade,
193 SCRA 779 (1991)

A lawyer has a sworn duty to act with fidelity toward his clients. Canon 17, Code of
Professional Responsibility states that “[a] lawyer owes fidelity to the cause of his client
and shall be mindful the trust and confidence reposed in him;” and Rule 1.01 which
prohibits lawyers from engaging in unlawful, dishonest, immoral or deceitful conduct. The
requirement of good moral character is not only a condition precedent to admission to the
Philippine Bar but is also a continuing requirement to maintain one’s good’s standing in the
legal profession. (In Re: Suspension from the Practice of law, 435 SCRA 417)

“The present case focuses on a critical aspect of the lawyer-client relationship: the duty of
loyalty. The fidelity lawyers owe their clients is traditionally characterized as “undivided.”
This means that lawyers must represent their clients and serve their needs without
interference or impairment from any conflicting interest. Rule 15.03 of the Code of
Professional Responsibility, deals with conflicts in the interests of an attorney’s actual
clients among themselves, of existing and prospective clients, and of the attorney and his
clients. It states that a lawyer shall not represent conflicting interests except by written
consent of all concerned given after a full disclosure of the facts. The relation of attorney
and client begins from the time an attorney is retained. An attorney has no power to act as
counsel or legal representative for a person without being retained. To establish the
professional relation, it is sufficient that the advice and assistance of an attorney are sought
and received in any manner pertinent to his profession. Inapplicable to the case, is Canon
15 of the same Code which encompasses the aforementioned rule. In general terms, Canon
15 requires lawyers to observe loyalty in all dealings and transactions with their clients.
Unquestionably, an attorney giving legal advice to a party with an interest conflicting with

Chapter IV – The Lawyer and The Client Page 10

that of his client resulting in detriment to the latter may be held guilty of disloyalty.
However, far be it that every utterance of an attorney which may have afforded an
individual some relief adverse to the former’s client may be labeled as a culpable act of
disloyalty. As in every case, the acts alleged to be culpable must be assessed in light of the
surrounding circumstances. We are not unaware of the custom of practitioners in a law
firm of assigning cases and even entire client accounts to associates or other partners with
limited supervision, if at all. However, let it not be said that law firm practitioners are given
a free hand to assign cases to seasoned attorneys and thereafter conveniently forget about
the case. To do so would be a disservice to the profession, the integrity and advancement of
which this Court must jealously protect. Law practitioners are acutely aware of the
responsibilities that are naturally taken on by partners and supervisory lawyers over the
lawyers and non-lawyers of the law office. Lawyers are administratively liable for the
conduct of their employees in failing to timely file pleadings. We now hold further that
partners and practitioners who hold supervisory capacities are legally responsible to exert
ordinary diligence in apprising themselves of the comings and goings of the cases handled
by the persons over which they are exercising supervisory authority and in exerting
necessary efforts to foreclose the occurrence of violations of the Code of Professional
Responsibility by persons under their charge. Nonetheless, the liability of the supervising
lawyer in this regard is by no means equivalent to that of the recalcitrant lawyer. The
actual degree of control and supervision exercised by said supervising lawyer varies, inter
alia, according to office practice, or the length of experience and competence of the lawyer
supervised. Such factors can be taken into account in ascertaining the proper penalty.
Certainly, a lawyer charged with the supervision of a fledgling attorney prone to rookie
mistakes should bear greater responsibility for the culpable acts of the underling than one
satisfied enough with the work and professional ethic of the associate so as to leave the
latter mostly to his/her own devises. (Solatan v. Inocentes, 466 SCRA 1)

CANON 18 - A LAWYER SHALL SERVE HIS CLIENT WITH COMPETENCE AND DILIGENCE.

Competence – sufficiency of lawyer’s qualifications to deal with the matter in question and
includes knowledge and skill and the ability to use them effectively in the interest of the
client.

Diligence - “the attention and care required of a person in a given situation and is the
opposite of negligence”. It is axiomatic in the practice of law that the price of success is
eternal diligence to the cause of the client. (Edquibal v. Ferrer, 450 SCRA 406)

Lawyer impliedly represents that: he possesses requisite degree of learning, skill, ability
which is necessary to the practice of his profession and which other similarly situated
possess; he will exert his best judgment in the prosecution or defense of the litigation
entrusted to him; he will exercise reasonable and ordinary care and diligence in the use of
his skill and in the application of his knowledge to his client’s cause; he will take such steps
as will adequately safeguards his client’s interest. A client may reasonably expect that
counsel will make good his representations.

Rules 18.01 - A lawyer shall not undertake a legal service which he knows or should
know that he is not qualified to render. However, he may render such service if, with

Chapter IV – The Lawyer and The Client Page 11

the consent of his client, he can obtain as collaborating counsel a lawyer who is
competent on the matter.

However well-meaning he may be, a lawyer cannot ask another lawyer to collaborate with
him in a particular case without the consent of the client. The fiduciary nature of attorney-
client relationship prohibits this.

Some cases involve specialized fields of law and require special training. A lawyer should
not accept an undertaking in specific area of law which he knows or should know he is
unqualified to enter.

Rule 18.02 - A lawyer shall not handle any legal matter without adequate
preparation.

Lawyer should safeguard his client’s rights and interests by thorough study and
preparation; mastering applicable law and facts involved in a case, regardless of the nature
of the assignment; and keeping constantly abreast of the latest jurisprudence and
developments in all branches of the law.

Rule 18.03 - A lawyer shall not neglect a legal matter entrusted to him, and his
negligence in connection therewith shall render him liable.

The standard of diligence required of a lawyer is that of a good father of a family. He is not
bound to exercise extraordinary diligence

There is want of required diligence when a lawyer fails without sufficient justification to
bring an action immediately, to answer a complaint within the reglementary period, to
notify his client of the date of the date of hearing, to attend the scheduled pre-trial
conference, to inform the client of an adverse judgment within the reglementary period to
appeal, to take steps to have the adverse decision reconsidered or appealed, to ascertain
the correct date of receipt of decision, to acquaint himself with what has happened to the
litigation, to pay docket fee on appeal, to claim judicial notice sent to him by mail or to file
the appellant’s brief.

It should be remembered that the moment the lawyer takes a client’s cause, he covenants
that he will exert all effort for its prosecution until its final conclusion. A lawyer who fails to
exercise due diligence or abandons his client’s cause makes him unworthy of the trust
reposed on him by the latter. (Legarda v. CA, 209 SCRA 722)

Rule 18.04 - A lawyer shall keep the client informed of the status of his case and shall
respond within a reasonable time to the client's request for information.

It was unnecessary to have complainants wait, and hope, for six long years on their pension
claims. Upon their refusal to co-operate, respondent should have forthwith terminated
their professional relationship instead of keeping them hanging indefinitely. (Blanza v.
Arcangel)

Chapter IV – The Lawyer and The Client Page 12

CANON 19 - A LAWYER SHALL REPRESENT HIS CLIENT WITH ZEAL WITHIN THE
BOUNDS OF THE LAW.

Rule 19.01 - A lawyer shall employ only fair and honest means to attain the lawful
objectives of his client and shall not present, participate in presenting or threaten to
present unfounded criminal charges to obtain an improper advantage in any case or
proceeding.

Rule 138, Sec. 20(d). Duties of attorneys.—It is the duty of an attorney: (d) To employ, for
the purpose of maintaining the causes confided to him, such means only as are consistent
with truth and honor, and never seek to mislead the judge or any judicial officer by an
artifice or false statement of fact or law.

Rule: In espousing his client’s cause, a lawyer should not state his personal belief as to the
soundness or justice of his case. Reasons: the lawyer’s personal belief has no real bearing
on the case; if expression of belief were permitted, it would give improper advantage to the
older and better known lawyer whose opinion would carry more weight; If such were
permitted, omission to make such assertion might be taken as an admission of the lack or
belief in the soundness of his client’s cause.

Rule 19.02 - A lawyer who has received information that his client has, in the course
of the representation, perpetrated a fraud upon a person or tribunal, shall promptly
call upon the client to rectify the same, and failing which he shall terminate the
relationship with such client in accordance with the Rules of Court.

Canon 19.02 merely requires the lawyer to terminate his relationship with the client in the
event the latter fails or refuses to rectify the fraud.

Rule: A lawyer may not volunteer the information concerning the client’s commission of
fraud to anybody, as it will violate his obligation to maintain his client’s secrets
undisclosed.

Rule 19.03 - A lawyer shall not allow his client to dictate the procedure in handling
the case.

Rule 138, sec. 23. Authority of attorneys to bind clients.—Attorneys have authority to
bind their clients in any case by any agreement in relation thereto made in writing, and in
taking appeals, and in all matters of ordinary judicial procedure. But they cannot, without
special authority, compromise their client's litigation, or receive anything in discharge of a
client's claim but the full amount in cash.

A lawyer should seek instruction from his client on any substantial matter concerning the
litigation, which requires decision on the part of the client (i.e. whether to compromise the
case, or to appeal an unfavorable judgment.) In procedural matters, the client must yield to
the lawyer.

Rule: In matters of law, it is the client who should yield to the lawyer and not the other way
around.

Chapter IV – The Lawyer and The Client Page 13

Reasons: Lawyer’s duty to the court is foremost. The dignity of the legal profession may be
compromised.

MISTAKES OR NEGLIGENCE OF LAWYER BINDING UPON CLIENT

(1998, 200, 2002 BAR EXAMS)
General Rule: Client is bound by attorney’s conduct, negligence and mistake in handling
case or in management of litigation and in procedural technique, and he cannot be heard to
complain that result might have been different had his lawyer proceeded differently.

Exceptions:
1. Where adherence thereto results in outright deprivation of client’s liberty or
property or where interest of justice so requires.
2. Where error by counsel is purely technical which does not affect substantially
client’s cause.
3. Ignorance, incompetence or inexperience of lawyer is so great and error so serious
that client, who has good cause is prejudiced and denied a day in court.
4. Gross negligence of lawyer.
5. Lack of acquaintance with technical part of procedure.

CANON 20 - A LAWYER SHALL CHARGE ONLY FAIR AND REASONABLE FEES.

Rule 138, Sec. 24. Compensation of attorneys.—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 therefore unless found by the
court to be unconscionable or unreasonable.

Rule 138, Sec. 32. Compensation for attorneys de oficio.—Subject to availability of funds
as may be provided by law the court may, in its discretion, order an attorney employed as
counsel de oficio to be compensated in such sum as the court may fix in accordance with
section 24 of this rule. Whenever such compensation is allowed, it shall not be less than
P30 in any case, nor more than the following amounts:
- P50 in light felonies;
- P100 in less grave felonies;
- P200 in grave felonies other than capital offenses;
- P500 in capital offenses.

TYPES OF FEES CHARGED BY LAWYERS

There are several common types of fee arrangements used by lawyers like the following:

Consultation Fee: The lawyer may charge a fixed or hourly fee for a first meeting with a
prospective client where both determine whether the lawyer can assist the client.

Contingency Fees: The lawyer's fee is based on a percentage of the amount awarded in the
case. If the client loses the case, the lawyer does not get a fee, but the client still has to pay

Chapter IV – The Lawyer and The Client Page 14

expenses. Contingency fee percentages vary. This type of fee arrangement may be charged
in personal injury cases, property damage cases, or other cases where a large amount of
money is involved. Lawyers may also be prohibited from making contingency fee
arrangements in certain kinds of cases such as criminal and child custody matters.

Flat Fees: A lawyer charges a specific, total fee. A flat fee is usually offered only if the case
is relatively simple or routine such as a will or an uncontested divorce.

Hourly Rate: The lawyer will charge for each hour (or portion of an hour) that the lawyer
works on the case. This is the most typical fee arrangement. Some lawyers charge different
fees for different types of work (legal research versus a court appearance).

Referral Fee: A lawyer who refers a person to another lawyer may ask for a portion of the
total fee the client pays for the case. Just like other fees, the total fee must be reasonable
and the client must agree to the arrangement.

Retainer Fee: The amount of money a client pays an attorney before the attorney begins
working on the client’s case. The payment solidifies the fact that the client and attorney are
working with one another, and it allows the attorney to meet the expenses of running the
office, conducting legal research, investigating the client’s case, and doing other things on
behalf of the client. A retainer is like a "down payment" against which future costs are
billed. The retainer is usually placed in a special account and the cost of services is
deducted from that account as they accrue. Many retainer fees are non-refundable unless
the fee is deemed unreasonable by a court.

Statutory Fee: The fees in some cases may be set by statute or a court may set and approve
a fee that you pay. These types of fees may appear in probate, bankruptcy, or other
proceedings.

RIGHT TO ATTORNEY’S FEES

While the practice of law is a profession and not a money-making trade, it does not operate
to deny a lawyer the right to attorney’s fees for his professional services. He has the right to
have and recover from his client a fair and reasonable compensation for his services, except
in cases where he has agreed to render service gratuitously or has been appointed counsel
de oficio.

Lawyers should avoid controversies concerning compensation so far as shall be compatible

with self-respect and with right to receive a reasonable recompense for services. Resort to
law suits with clients should only be done to prevent injustice, imposition or fraud. The
impression is that those instituting suits are mercenaries.

GENERALLY, the right of a lawyer to reasonable compensation for services requires the
following:
1. that attorney-client relationship exists; and
2. that he rendered services to the client.

A written agreement is not necessary to establish a client’s obligation to pay attorney’s

fees. As long as the lawyer is honestly and in good faith trying to serve and represent the
interest of his client, an absence of express undertaking does not defeat recovery of fees.

Chapter IV – The Lawyer and The Client Page 15

Client’s obligation to pay attorney’s fees arises from the inanimate contract of facis ut des (I
do and you give) which is based on the principle that no one shall unjustly enrich himself at
the expense of another.

General Rule: A person who had no knowledge of, or objected to, the lawyer’s
representation may not be held liable for attorney’s fees even though such representation
redounded to his benefit. The objection should be raised before and not after beneficial
services shall have been rendered by the lawyer; otherwise, the party who benefited may
be required to pay counsel fees. For it is neither just that client who retained lawyer should
alone pay nor is it fair that those who, investing nothing and assuming no risk, received
benefits should not contribute their proportionate share to counsel fees (based on equity).

Non-lawyer cannot recover attorney’s fees even if there is a law authorizing him to
represent a litigant in court because basis of reasonable compensation is the existence of
attorney-client relationship and the rendition of services.

Lawyer who is absolutely disqualified from engaging in private practice of law by reason of
his government position may neither practice law nor, should he do so illegally, charge
attorney’s fees for such services. Exception: fees for services already performed before
lawyer qualified for public office even though payment is made thereafter.

Lawyer designated by court to render professional services, in the absence of law allowing
compensation, cannot charge government nor the indigent litigant for his professional
services. Appointment neither violates constitutional restriction against taking of property
without just compensation or the due process of law nor imposes upon the government the
obligation to pay him his fees because one of the obligations of an attorney willingly
assumed when he took his oath as lawyer is to render free legal services whenever
required by the court to do so.

Rules of Court: Court, in its discretion, may grant (token) compensation subject to
availability of funds: P30-P50 in light felonies; P100 in less grave felonies; P200 in grave
felonies other than capital offenses; P500 in capital offenses. This is not intended as a
source of regular income.

Misconduct on part of lawyer may affect or negate his right to recover from client a
reasonable compensation for services already performed. (examples: negligence,
carelessness, misrepresentation, unfaithfulness or abuse of client’s confidence). Basis: good
morals and public policy.

Although a client has right to discharge lawyer anytime, dismiss or settle action or even
waive the whole of his interest in favor of adverse party, he cannot, in the absence of
lawyer’s fault, consent or waiver, deprive the lawyer of his just fees already earned.

QUANTUM MERUIT
When no price is stipulated for lawyer’s service, courts will fix amount on quantum meruit
basis, or such amount which his service merits.

Chapter IV – The Lawyer and The Client Page 16

Requisite for principle: that there is an acceptance of the benefits by one sought to be
charged for the services rendered under circumstances as reasonably to notify him that the
lawyer performing the task is expecting to be paid compensation.

Doctrine of quantum meruit is a device to prevent undue enrichment based on the

equitable postulate that it is unjust for a person to retain benefit without paying for it.

Other times when doctrine applicable:

1. where amount stipulated in written agreement is found to be unconscionable or
2. where client dismissed counsel before termination of case or
3. where the lawyer withdrew therefrom for valid reasons.

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. 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. (Metrobank vs. CA, 181 SCRA 367)

Since the main case from which the petitioner's claims for their fees may arise has not yet
become final, the determination of the propriety of said fees and the amount thereof should
be held in abeyance. This procedure gains added validity in the light of the rule that the
remedy for recovering attorney's fees as an incident of the main action may be availed of
only when something is due to the client. (Quirante v. IAC, 169 SCRA 769)

The mere fact that an agreement had been reached between attorney and client fixing the
amount of the attorney's fees, does not insulate such agreement from review and
modification by the Court where the fees clearly appear to be excessive or unreasonable.
(Tanhueco v. De Dumo, 172 SCRA 760)

The Counsel if worthy of his hire, is entitled to be fully recompensed for his services. With
his capital consisting solely of his brains and his skill, acquired at tremendous cost not only
in money but in the expenditure of time and energy, he is entitled to the protection of any
judicial tribunal against any attempt on the part of a client to escape payment of his fees.
(Albano v. Coloma, 21 SCRA 411)

Rule 20.01 - A lawyer shall be guided by the following factors in determining his fees:

(a) the time spent and the extent of the service rendered or required;

(b) the novelty and difficulty of the questions involved;

(c) The importance of the subject matter;

(d) The skill demanded;

Chapter IV – The Lawyer and The Client Page 17

 (e) The probability of losing other employment as a result of acceptance of the
proffered case;

(f) The customary charges for similar services and the schedule of fees of the IBP
chapter to which he belongs;

(g) The amount involved in the controversy and the benefits resulting to the client
from the service;

(h) The contingency or certainty of compensation;

(i) The character of the employment, whether occasional or established; and

(j) The professional standing of the lawyer.

A valid written contract is conclusive as to amount of compensation. Unless both parties set
aside contract and submit question of reasonableness of amount of fees for court to resolve
on quantum meruit basis, neither client nor lawyer may disregard amount fixed.

None of the factors is controlling but are guides only. Other factors:
a) actual purchasing power of Philippine peso
b) omission or fault of lawyer
c) loss of opportunity on part of lawyer for other employment
d) financial capacity of client

Amount based on Quantum Meruit: Quantum Meruit means as much as a lawyer

deserves. Its essential requisite is acceptance of the benefits by one sought to be charged
for services rendered under circumstances as reasonably to notify him that lawyer expects
compensation.

Instances when Court will fix Amount of Attorney’s Fees based on Quantum Meruit:
1. agreement is invalid for some reason other than illegality of object of performance
2. amount stipulated is unconscionable
3. no agreement as to fees existed between parties
4. client rejects amount fixed in contract as unconscionable and is found to be so
5. lawyer, without fault, was unable to conclude litigation

Agpalo adds (1) the results secured and (2) whether or not the fee is contingent, it being
recognized as a rule that an attorney may properly charge a higher fee when it is
contingent that when it is absolute. Even other consideration may be the actual purchasing
power of the Philippine Peso, the omission of fault of the lawyer in the discharge of his
duties, the loss of opportunity on the part of a lawyer for other employment of the financial
capacity of the client.

Rule 20.02 - A lawyer shall, in case of referral, with the consent of the client, be
entitled to a division of fees in proportion to the work performed and responsibility
assumed.

Chapter IV – The Lawyer and The Client Page 18

Lawyers sometimes use the lawyer-referral system. It is an aid to selection of qualified
lawyers. This system helps individuals in locating lawyers competent to handle their
particular problem. It enables laymen to have informed selection of competent lawyers
who have experience in the subject matter involved in a particular case. It is however
stressed that it is improper for a lawyer to receive compensation for merely recommending
another lawyer to his client for if such practice is permitted, it would tend to germinate
evils of commercialism and to destroy proper appreciation of professional responsibility. It
is only when, in addition to referral, he performs legal service or assumes responsibility in
case that he will be entitled to a fee.

Rule 138, Sec. 27 of the Revised Rules of Court. Said provision enumerates the grounds
for the suspension and disbarment of lawyers, namely:

“Sec. 27. Attorneys removed or suspended by Supreme Court, on what grounds, - A

member of the bar may be removed or suspended from his office as attorney by the
Supreme Court for any deceit, malpractice or other gross misconduct in such office, grossly
immoral conduct or by reason of his conviction of a crime involving moral turpitude, or for
any violation of the oath of which he is required to take before admission to practice, or for
willful disobedience of any lawful order of a superior court or for corruptly or wilfully
appearing as an attorney for a party to a case without any authority to do so. The practice
of soliciting cases at law for the purpose of gain, either personally or through paid agents or
brokers, constitutes malpractice. (Urban Bank v. Pena)

Rule 20.03 - A lawyer shall not, without the full knowledge and consent of the client,
accept any fee, reward, costs, commission, interest, rebate or forwarding allowance or
other compensation whatsoever related to his professional employment from anyone
other than the client.

Rule 138, sec. 20(e). Duties of attorneys.—It is the duty of an attorney: (e) … to accept no
compensation in connection with his client's business except from him or with his
knowledge and approval.

Reason: to ensure protection of lawyers in collection of fees. Moreover, it is designed to

secure the lawyer’s wholehearted fidelity to the client’s cause and to prevent that situation
in which the receipt by him of a rebate or commission from another in connection with the
client’s cause may interfere with the full discharge of his duty to the client. The amount
received by lawyer from opposite party or third persons in the service of his client belongs
to the client except when the latter has full knowledge and approval of lawyer’s taking.

Rule 20.04 - A lawyer shall avoid controversies with clients concerning his
compensation and shall resort to judicial action only to prevent imposition, injustice or
fraud.
Suits to collect fees should be avoided and only when the circumstances imperatively
require should a lawyer resort to lawsuit to enforce payment of fees. This is but a logical
consequence of the legal profession not primarily being for economic compensation.

An attorney-client relationship can be created by implied agreement, as when the attorney

actually rendered legal services for a person who is a close friend. The obligation of such a

Chapter IV – The Lawyer and The Client Page 19

person to pay attorney’s fees is based on the law of contracts’ concept of facio ut des (no
one shall unjustly enrich himself at the expense of others.) (Corpuz v. CA, 98 SCRA 424)

CANON 21 - A LAWYER SHALL PRESERVE THE CONFIDENCE AND SECRETS OF HIS

CLIENT EVEN AFTER THE ATTORNEY-CLIENT RELATION IS TERMINATED.

Rule 138, 20(e). Duties of attorneys.—It is the duty of an attorney: (e) To maintain
inviolate the confidence, and at every peril to himself, to preserve the secrets of his client,
and to accept no compensation in connection with his client's business except from him or
with his knowledge and approval.

Rule 130, sec. 21(b). Privileged communication. —An attorney cannot, without the
consent of his client, be examined as to any communication made by the client to him, or
his advice given thereon in the course of professional employment; nor can an attorney's
secretary, stenographer, or clerk be examined, without the consent of the client and his
employer, concerning any fact the knowledge of which has been acquired in such capacity.

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. Covers all actions, signs, means of communication.

There is a difference between confidences and secrets of clients. While confidences refer to
information protected by attorney-client privilege under the Revised Rules of Court
(information pertinent to the case being handled), secrets are those other information
gained in the professional relationship that the client has requested to be held inviolate or
the disclosure of which would be embarrassing or would likely be detrimental to client
(information not exactly pertinent to case).

To constitute professional employment it is not essential that the client should have
employed the attorney professionally on any previous occasion. If a person, in respect to
his business affairs or troubles of any kind, consults with his attorney in his professional
capacity with the view to obtaining professional advice or assistance, and the attorney
voluntarily permits or acquiesces in such consultation, then the professional employment
must be regarded as established. Information so received is sacred to the employment to
which it pertains, and to permit to be used in the interest of another, or, worse still, in the
interest of the adverse party, is to strike at the element of confidence which lies at the basis
of, and affords the essential security in, the relation of attorney and client.

Rationale behind this prohibition: not only to prevent the dishonest practitioner from
fraudulent conduct, but also to protect the honest lawyer from unfounded suspicion of
unprofessional practice. It is founded on principles of public policy, on good taste. The
question is not necessarily one of the rights of the parties, but as to whether the attorney
has adhered to proper professional standard. (Hilado v. David, 83 Phil 569)

Rule 21.01 - A lawyer shall not reveal the confidences or secrets of his client except;

Chapter IV – The Lawyer and The Client Page 20

 (a) When authorized by the client after acquainting him of the consequences of the
disclosure;

(b) When required by law;

(c) When necessary to collect his fees or to defend himself, his employees or
associates or by judicial action.

Exceptions to the General Rule:

1. In cases of contemplated crimes or perpetuation of fraud (reason: lawyer-client
relationship should only be for lawful purposes)
2. In case client files complaint against his lawyer or unreasonably refuses to pay his
fees, lawyer may disclose so much of client’s confidences as may be necessary to
protect himself or to collect fees.

Rule 21.02 - A lawyer shall not, to the disadvantage of his client, use information
acquired in the course of employment, nor shall he use the same to his own advantage
or that of a third person, unless the client with full knowledge of the circumstances
consents thereto.

Rule 21.03 - A lawyer shall not, without the written consent of his client, give
information from his files to an outside agency seeking such information for auditing,
statistical, bookkeeping, accounting, data processing, or any similar purpose.

The reason for the rule is that the work and product of a lawyer, such as his effort,
research, and thought, and the records of his client, contained in his files are privileged
matters.

Rule 21.04 - A lawyer may disclose the affairs of a client of the firm to partners or
associates thereof unless prohibited by the client.

Rule 21.05 - A lawyer shall adopt such measures as may be required to prevent those
whose services are utilized by him, from disclosing or using confidences or secrets of
the clients.

Professional employment of a law firm is equivalent to retainer of the members thereof

even though only one partner is consulted. When one partner tells another about the
details of the case, it is not considered as disclosure to third persons because members of a
law firm are considered as one entity.

Rule 21.06 - A lawyer shall avoid indiscreet conversation about a client's affairs even
with members of his family.

A lawyer must not only preserve the confidences and secrets of his clients in his law office
but also outside including his home. He should avoid committing calculated indiscretion,
that is, accidental revelation of secrets obtained in his professional employment. Reckless
or imprudent disclosure of the affairs of his clients may jeopardize them. Not every
member of the lawyer’s family has the proper orientation and training for keeping client’s
confidences and secrets.

Chapter IV – The Lawyer and The Client Page 21

 Rule 21.07 - A lawyer shall not reveal that he has been consulted about a particular
case except to avoid possible conflict of interest.

A lawyer must not only preserve the confidences and secrets of his clients in his law office
but also outside including his home. He should avoid committing calculated indiscretion,
that is, accidental revelation of secrets obtained in his professional employment. Reckless
or imprudent disclosure of the affairs of his clients may jeopardize them. Not every
member of the lawyer’s family has the proper orientation and training for keeping client’s
confidences and secrets.

This rule clarifies that privilege communication applies even to prospective clients.
Moreover, the prohibition applies even if the prospective client did not thereafter actually
engage the lawyer. By the consultation, the lawyer already learned of the secrets of
prospective client. It is not fair if he will not be bound by the rule on privileged
communication in respect of matters disclosed to him by a prospective client. This rule, of
course, is subject to exception of representation of conflicting interests.

CANON 22 - A LAWYER SHALL WITHDRAW HIS SERVICES ONLY FOR GOOD CAUSE AND
UPON NOTICE APPROPRIATE IN THE CIRCUMSTANCES.

Causes of Termination of Attorney-Client Relation

1. Withdrawal of the lawyer under Rule 22.01
2. Death of the lawyer
3. Death of client
4. Discharge or dismissal of the lawyer by the client
5. Appointment or election of a lawyer to a government position which prohibits
private practice of law
6. Full termination of the case
7. Disbarment or suspension of the lawyer from the practice of law
8. Intervening incapacity or incompetence of the client during pendency of case
9. Declaration of presumptive death of lawyer
10. Conviction of a crime and imprisonment of lawyer

Note: Except for items 2 and 6, the lawyer has duty to notify the court in case of
termination of attorney-client relationship.

A contract for legal services being personal, it terminates upon death of the lawyer.
However, if the lawyer is a member of a law firm, which firm appears as counsel for the
client, the death of the attending lawyer will not terminate the relation. The firm will
continue to appear as counsel for client unless there has been agreement that services were
to be rendered only by the said attorney.
Who may Terminate Attorney-Client Relation
1. Client
Client has absolute right to discharge his attorney with or without just cause or even
against lawyer’s consent. Existence or nonexistence of a just cause is important only in
determining right of an attorney to compensation for services rendered.

Chapter IV – The Lawyer and The Client Page 22

Discharge of an attorney or his substitution by another without justifiable cause will not
operate to extinguish the lawyer’s right to full payment of compensation as agreed upon in
writing.

2. Attorney
3. Court
4. Circumstances beyond control of parties

Discharge of attorney must be made known to the court and adverse party through a
formal notice. This is unnecessary between the lawyer and client, himself. But insofar as
the court and other party are concerned, the severance of the relation of attorney and client
is not effective until a notice of discharge by the client or a manifestation clearly indicating
that purpose is filed with the court and a copy thereof served upon the adverse party.

Before discharge is recorded in the court, the lawyer’s power is limited to (1) making that
fact known to court and to adverse party, and to (2) preserving and protecting client’s
interest until final discharge or new counsel enters appearance. He cannot pretend to
continue representing client.

Representation continues until the court dispenses with the services of counsel in
accordance with Section 26, Rule 138 of the Rules of Court. Counsel may be validly
substituted only if the following requisites are complied with: (1) New counsel files a
written application for substitution; (2) The client’s written consent is obtained; (3) The
written consent of the lawyer to be substituted is secured, if it can still be; if the written
consent can no longer be obtained, the application for substitution must carry proof that
notice of the motion has been served on the attorney to be substituted in the manner
required by the Rules. (Obando v. Figueras)

Rule 22.01 - A lawyer may withdraw his services in any of the following case:

(a) When the client pursues an illegal or immoral course of conduct in connection
with the matter he is handling;

(b) When the client insists that the lawyer pursue conduct violative of these canons
and rules;

(c) When his inability to work with co-counsel will not promote the best interest of
the client;

(d) When the mental or physical condition of the lawyer renders it difficult for him
to carry out the employment effectively;

(e) When the client deliberately fails to pay the fees for the services or fails to
comply with the retainer agreement;

(f) When the lawyer is elected or appointed to public office; and

(g) Other similar cases.

Chapter IV – The Lawyer and The Client Page 23

A lawyer shall withdraw his services only for good cause and upon notice appropriate in
the circumstances; a lawyer shall avoid controversies with clients concerning his
compensation and shall resort to judicial action only to prevent imposition, injustice or
fraud. (Montano v. IBP, 358 SCRA 1)

If a person, in respect to his business affairs or troubles of any kind, consults with his
attorney in his professional capacity with the view of obtaining professional advice or
assistance, and the attorney voluntarily permits or acquiesces in such consultation, then
the professional employment must be regarded as established. (Hilado vs. David, 84 Phil.
56)

The withdrawal as counsel of a client or the dismissal by the client of his counsel must be in
a formal petition filed in the case. Attorney.-client relationship does not terminate formally
until there is withdrawal made of record. Unless properly relieved, counsel is responsible
for the conduct of the case. (Tumbagahan vs. CA, 165 SCRA 485)

Procedure for Withdrawal:

If without written consent from client, lawyer should file petition for withdrawal in court
and he must serve copy of his petition upon his client and the adverse party at least 3 days
before date set for hearing. He should also give time to client to secure services from
another lawyer in the case from which he is withdrawing.

Change or Substitution of Counsel

Change of counsel
1) client discharges attorney with or without cause: no consent or notice to lawyer
needed, nor court approval
2) attorney may initiate move by withdrawing his appearance with written consent of
client or with leave of court on some justifiable ground
3) substitution of counsel in the form of application for that purpose: constitutes an
appearance of the substituting counsel and is a polite way of effecting change;
compliance with formalities is necessary since it involves ethical considerations

Requirements for substitution

1) written application for substitution
2) written consent of client
3) written consent of attorney to be substituted

In case written consent of attorney cannot be secured, proof of service of notice of

application upon attorney to be substituted. In case of death of original attorney, additional
requirement of verified proof of death necessary

Notes Regarding Substitution:

- usually initiated by substituting counsel hence the need to obtain conformity of
original lawyer or at least notice to original lawyer of substitution
- consent of original lawyer or notice requirement is designed to afford the lawyer the
opportunity to protect his right to attorney’s fees. If he gives consent, it is presumed
he has settled that question. If not, he can ask in same action that his chance to have
his right to attorney’s fees be preserved and protected.

Chapter IV – The Lawyer and The Client Page 24

Effects of Defective Substitution
1. A defective substitution is one which lacks any of the requisites for a valid
substitution.
2. It does not effect a change of counsel; nor constitute an appearance of new lawyer,
both of whom shall be deemed counsel of record; pleadings filed by the new lawyer
deemed effective.

Employment of additional counsel

Client has right to as many lawyers as he can afford. Client’s proffer of assistance of
additional counsel should not be regarded as evidence of want of confidence.

Professional courtesy requires that a lawyer retained as collaborating counsel should at

least communicate with counsel of record before entering his appearance and should
decline association if objectionable to original counsel.

But if first lawyer is relieved by client, another lawyer may come into the case.

Rule 22.02 - A lawyer who withdraws or is discharged shall, subject to a retainer

lien, immediately turn over all papers and property to which the client is entitled, and
shall cooperative with his successor in the orderly transfer of the matter, including all
information necessary for the proper handling of the matter.

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

Lawyer’s withdrawal or discharge shall be without prejudice to his attorney’s lien:

Purpose of Rule 22.02 (lawyer entitled to retaining lien) and Rule 16.03 (lawyer entitled to
retaining and charging lien): to insure payment of lawyer’s professional fees and the
reimbursement of his lawful disbursements in keeping with his dignity as an officer of the
court.

Kinds of Liens
1. Retaining Lien (general lien) - the right of an attorney to retain the funds, documents
and papers of his client which have lawfully come into his possession until his lawful fees
and disbursements have been paid and to apply such funds to the satisfaction thereof.

Reason and essence of lien: inconvenience or disadvantage caused to the client because
of exercise of such lien may induce client to pay the lawyer his fees and disbursements.

It is a general lien for the balance of the account due to the attorney from client for services
rendered in all matters he may have handled for the client, regardless of outcome.

It is dependent upon and takes effect from time of lawful possession and does not require
notice thereof upon client and the adverse party to be effective.

Chapter IV – The Lawyer and The Client Page 25

Passive right and cannot be actively enforced; amounts to a mere right to retain funds,
documents and papers as against the client until the attorney is fully paid his fees.
However, lawyer may apply so much of client’s funds in his possession to satisfy his lawful
fees and disbursements, giving notice promptly thereafter to his client.
Requisites for validity (of retaining lien)
1. attorney-client relationship
2. lawful possession by lawyer of the client’s funds, documents and papers in his
professional capacity
3. unsatisfied claim for attorney’s fees or disbursements

2. Charging Lien (special lien)

A charging lien is a right which the attorney has upon all judgments for the payment of
money and executions issued in pursuance thereof, secured in favor of his client. Covers
only services rendered by attorney in the action in which the judgment was obtained and
takes effect only after a statement of claim has been entered upon record of the particular
action with written notice to his client and adverse party.

Requisites for validity of charging lien

1. attorney-client relationship
2. attorney has rendered services
3. money judgment favorable to the client has been secured in the action
4. attorney has a claim for attorney’s fees or advances
5. statement of his claim has been duly recorded in the case with notice thereof served
upon the client and adverse party

DIFFERENCE BETWEEN RETAINING AND CHARGING LIENS

RETAINING CHARGING
Nature Passive lien. It cannot be actively Active lien. It can be enforced by
enforced. It is a general lien. execution. It is a special lien.
Basis Lawful possession of funds, papers, Securing of a favorable money
documents, property belonging to judgment for client
client
Coverage Covers only funds, papers, Covers all judgments for the
documents, and property in the payment
lawful possession of the attorney by of money and executions issued in
reason of his professional pursuance of such judgment
employment
Effectivity As soon as the lawyer gets As soon as the claim for attorney’s
possession of the funds, papers, fees had been entered into the
documents, property records of the case
Notice Client need not be notified to make Client and adverse party need to
it notified to make it effective
Effective
Applicability May be exercised before judgment Generally, it is exercisable only
or execution, or regardless thereof when the attorney had already
secured a favorable judgment for
his client

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