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LAWYER SHOULD NOT BORROW MONEY FROM HIS CLIENT (CANON 16.04)
Question: Atty. Palaa borrowed from Sps. Tejada the amount of P100K
with interest of P70K payable in three months to allow him to reconstitute the
title of his real property.
After the lapse of three months without fulfilling his promise to pay the
principal of his loan and its interest, Sps. Amador asked Atty. Palaa to
settle his obligation. The demands remain unheeded. Can Atty. Palaa be
held administratively liable for not settling his loan despite persistent
demand from the creditor-spouses?
Answer: Yes. The complainants could not have been defrauded without the
representations of respondent. A promise of a high interest convinced the
complainants to give a loan of P100K to respondent lawyer. He knew that his
representations were false since the filing fee for a petition for reconstitution
and other expenses including the publication of the filing of the petition
could not have cost more than P20,000. It is clear that he employed deceit in
convincing complainants to part with their hard earned money; and the latter
could not have been easily swayed to lend the money were it not for his
misrepresentations and failed promises as a member of the bar.
Therefore, Atty. Palaa is liable for not paying his just obligation.