Professional Documents
Culture Documents
The Director of Lands vs. Ababa, Et Al., G.R. No. L-26096, February 27, 1979
FACTS: The adverse claimant, Atty. Alberto B. Fernandez was retained as counsel by
petitioner, Maximo Abarquez, in a civil case for the annulment of a contract of sale with
right of repurchase and for the recovery of the land which was the subject matter
thereof. The Court of First Instance of Cebu rendered a decision on May 29, 1961
adverse to the petitioner and so he appealed to the Court of Appeals. Litigating as a
pauper and engaging the services of his lawyer on a contingent basis, petitioner,
executed a document whereby he obliged himself to give to his lawyer one-half (1/2) of
whatever he might recover from Lots 5600 and 5602 should the appeal prosper.
Thereafter, the case was resolved in favor of Maximo Abarquez but he refused to
comply with his obligation and instead offered to sell the whole parcels of land to
petitioner-spouses Juan Larrazabal and Marta C. de Larrazabal. In order to protect his
interest, Atty. Fernandez filed an adverse claim for the half portion of the land, and it
was annotated in the certificate title of said land. Notwithstanding the annotation of the
adverse claim, petitioner-spouse Maximo Abarquez and Anastacia Cabigas conveyed
by deed of absolute sale two-thirds (2/3) of the lands to petitioner-spouses Juan
Larrazabal and Marta C. de Larrazabal. Petitioner spouses petitioned for the
cancellation of the adverse claim, contending that it is contrary to law and of the Canons
of Professional Ethics.
ISSUE: Whether or not the contract for a contingent fee, basis of the interest of Atty.
Fernandez, is prohibited by the Article 1491 of the New Civil Code and Canon 13 of the
Canons of Professional Ethics.
HELD: This contention is without merit. Article 1491 prohibits only the sale or
assignment between the lawyer and his client, of property which is the subject of
litigation. A contract for a contingent fee is not covered by Article 1491 because the
transfer or assignment of the property in litigation takes effect only after the finality of a
favorable judgment. In the instant case, the attorney's fees of Atty. Fernandez,
consisting of one-half (1/2) of whatever Maximo Abarquez might recover from his share
in the lots in question, is contingent upon the success of the appeal. Hence, the
payment of the attorney's fees, that is, the transfer or assignment of one-half (1/2) of the
property in litigation will take place only if the appeal prospers. Therefore, the transfer
actually takes effect after the finality of a favorable judgment rendered on appeal and
not during the pendency of the litigation involving the property in question.
Consequently, the contract for a contingent fee is not covered by Article 1491.
Petitioners her contend that a contract for a contingent fee violates the Canons of
Professional Ethics. This is likewise without merit. For while Canon 10 prohibits a lawyer
from purchasing ...any interest in the subject matter of the litigation which he is
conducting", Canon 13, on the other hand, allowed a reasonable contingent fee
contract, thus: "A contract for a contingent fee where sanctioned by law, should
be reasonable under all the circumstances of the case including the risk and
uncertainty of the compensation, but should always be subject to the supervision of a
court, as to its reasonableness. "Contracts of this nature are permitted because they
redound to the benefit of the poor client and the lawyer "especially in cases where
the client has meritorious cause of action, but no means with which to pay for legal
services unless he can, with the sanction of law, make a contract for a contingent fee to
be paid out of the proceeds of the litigation" (Francisco, Legal Ethics, p. 294 [1949],
citing Lipscomb vs. Adams 91 S.W. 1046, 1048 [1949]). Oftentimes, contingent fees
are the only means by which the poor and helpless can redress for injuries
sustained and have their rights vindicated. The one-half (½) interest of Atty. Fernandez
in the lots in question should therefore be respected. Indeed, he has a better right than
petitioner-spouses, Juan Larrazabal and Marta C. de Larrazabal. They purchased their
two-thirds (2/3) interest in the lots in question with the knowledge of the adverse
claim of Atty. Fernandez. The adverse claim was annotated on the old transfer
certificate of title and was later annotated on the new transfer certificate of title
issued to them. Having purchased the property with the knowledge of the adverse
claim, they are therefore in bad faith. Consequently, they are estopped from questioning
the validity of the adverse claim. WHEREFORE, THE DECISION OF THE LOWER
COURT DENYING THE PETITION FOR THE CANCELLATION OF THE ADVERSE
CLAIM SHOULD BE, AS IT IS HEREBY AFFIRMED, WITH COSTS
AGAINST PETITIONERAPPELLANTS JUAN LARRAZABAL AND MARTA C. DE
LARRAZABAL. SO, ORDERED.
The Conjugal Partnership of the Spouses Vicente Cadavedo and Benita
Arcoy-Cadavedo, G.R. No. 173188, January 15, 2014
Facts: The Spouses Cadavedo acquired a homestead grant over a 230,765-square
meter parcel of land known as Lot 5415 (subject lot) located in Gumay, Piñan,
Zamboanga del Norte. They were issued Homestead Patent No. V-15414 on March 13,
1953and Original Certificate of Title No. P-376 on July 2, 1953.On April30, 1955, the
spouses Cadavedo sold the subject lot to the spouses Vicente Ames and Martha
Fernandez (the spouses Ames) Transfer Certificate of Title (TCT) No. T-4792 was
subsequently issued in the name of the spouses Ames. The present controversy arose
when the spouses Cadavedo filed an action before the RTC against the spouses Ames
for sum of money and/or voiding of contract of sale of homestead after the latter failed
to pay the balance of the purchase price. The spouses Cadavedo initially engaged the
services of Atty. Rosendo Bandal who, for health reasons, later withdrew from the case;
he was substituted by Atty. Lacaya. On February 24, 1969, Atty. Lacaya amended the
complaint to assert the nullity of the sale and the issuance of TCT No. T-4792 in the
names of the spouses Ames as gross violation of the public land law. The amended
complaint stated that the spouses Cadavedo hired Atty. Lacaya on a contingency fee
basis. The contingency fee stipulation specifically reads:10. That due to the above
circumstances, the plaintiffs were forced to hire a lawyer on contingent basis and if they
become the prevailing parties in the case at bar, they will pay the sum ofP2,000.00 for
attorney’s fees. Eventually Atty. Lacaya represented the Cadavedo spouses I two other
cases in connection with the subject lot. On appeal to the CA the appellate court
granted attorney’s fee consisting of one-half or 10.5383hectares of the subject lot to
Atty. Lacaya, instead of confirming the agreed contingent attorney’s fees of 2,000.00₱
Issue: Whether or not the award by the CA of attorney's fees is valid.
Held: No, The Supreme Court held that spouses Cadavedo and Atty. Lacaya agreed
on a contingent fee of 2,000.00 and not, as asserted by the latter, one-half of the
subject lot. The stipulation contained in the amended complaint filed by Atty. Lacaya
clearly stated that the spouses Cadavedo hired the former on a contingency basis; the
Spouses Cadavedo undertook to pay their lawyer 2,000.00 as attorney’s fees should
the case be decided in their favor. Granting ₱arguendo that the spouses Cadavedo and
Atty. Lacaya indeed entered into an oral contingent fee agreement securing to the latter
one-half of the subject lot, the agreement is void. The agreement is champertous and is
contrary to public policy. Any agreement by a lawyer to “conduct the litigation in his own
account, to pay the expenses thereof or to save his client therefrom and to receive as
his fee a portion of the proceeds of the judgment is obnoxious to the law.” The rule of
the profession that forbids a lawyer from contracting with his client for part of the thing in
litigation in exchange for conducting the case at the lawyer’s expense is designed to
prevent the lawyer from acquiring an interest between him and his client.
Heirs of Juan de Dios Carlos vs. Linsangan, A.C. No. 11494, July 24, 2017
FACTS:
The parcel of land located in Alabang, Muntinlupa City and covered by Transfer
Certificate of Title (TCT) No. 139061 with an area of 12,331 square meters was
previously owned by the Spouses Felix and Felipa Carlos. Their son, Teofilo Carlos
(Teofilo), convinced them to transfer said title to his name with a promise to distribute
the same to his brothers and sisters. Teofilo delivered the owner's duplicate copy of the
title to his brother, Juan. However, Teofilo sold the entire property to Pedro Balbanero
(Pedro). Pedro, however, failed to pay the agreed installment payments.
Atty. Linsangan acted as counsel for their late father in several cases, one of which
involving the recovery of a parcel of land. Complainants alleged that Atty. Linsangan
forced them to sign pleadings and documents, sold the parcel of land in Alabang,
Muntinlupa City in cahoots with complainants' estranged mother, and evaded payment
of income taxes when he divided his share in the subject property as his supposed
attorney's fees to his wife and children.
ISSUE:
Whether or not respondent is guilty of violating his lawyer's oath.
RULING:
After a careful review of the record of the case, the Court finds that respondent
committed acts in violation of his oath as an attorney thereby warranting the Court's
exercise of its disciplinary power.
The practice of law is not a right but a privilege bestowed by the State upon
those who show that they possess, and continue to possess, the qualifications required
by law for the conferment of such privilege. Whether or not a lawyer is still entitled to
practice law may be resolved by a proceeding to suspend or disbar him, based on
conduct rendering him unfit to hold a license or to exercise the duties and
responsibilities of an attorney. The avowed purpose of suspending or disbarring an
attorney is not to punish the lawyer, but to remove from the profession a person whose
misconduct has proved him unfit to be entrusted with the duties and responsibilities
belonging to an office of an attorney, and thus to protect the public and those charged
with the administration of justice. The lawyer's oath is a source of obligations and its
violation is a ground for suspension, disbarment or other disciplinary action.
these acts are in direct contravention of Article 1491(5) of the Civil Code which forbids
lawyers from acquiring, by purchase or assignment, the property that has been the
subject of litigation in which they have taken part by virtue of their profession. While
Canon 10 of the old Canons of Professional Ethics, which states that " the lawyer
should not purchase any interests in the subject matter of the litigation which he is
conducting," is no longer reproduced in the new Code of Professional Responsibility
(CPR), such proscription still applies considering that Canon I of the CPR is clear in
requiring that "a lawyer shall uphold the Constitution, obey the laws of the land
and promote respect for law and legal process" and Rule 138, Sec. 3 which requires
every lawyer to take an oath to "obey the laws as well as the legal orders of the duly
constituted authorities therein." Here, the law transgressed by Atty. Linsangan is
Article 1491(5) of the Civil Code, in violation of his lawyer's oath.
Atty. Linsangan, at the guise of merely waiving portions of the subject property in favor
of his wife and children, actually divided his attorney's fee with persons who are not
licensed to practice law in contravention of Rule 9.02, Canon 9 of the CPR.
Another misconduct committed by Atty. Linsangan was his act of selling the entire
12,331 square meters property and making it appear that he was specifically authorized
to do so by complainants as well as by the other persons to whom portions of the
property had been previously adjudicated. However, a perusal of the supposed Special
Power of Attorney attached to the Deed of Absolute Sale, save for that executed by his
wife and children, only authorizes Atty. Linsangan to represent complainants in the
litigation of cases involving Juan's properties. Nothing in said Special Power of Attorney
authorizes Atty. Linsangan to sell the entire property including complainants' undivided
share therein.
Worse, Atty. Linsangan does not deny having received the downpayment for the
property from Helen. Atty. Linsangan does not also deny failing to give complainants'
share for the reason that he applied said payment as his share in the property. In so
doing, Atty. Linsangan determined all by himself that the downpayment accrues to him
and immediately appropriated the same, without the knowledge and consent of the
complainants. Such act constitutes a breach of his client's trust and a violation of Canon
16 of the CPR. Indeed, a lawyer is not entitled to unilaterally appropriate his client's
money for himself by the mere fact that the client owes him attorney’s fees. The failure
of an attorney to return the client's money upon demand gives rise to the presumption
that he has misappropriated it for his own use to the prejudice and violation of the
general morality, as well as of professional ethics; it also impairs public confidence in
the legal profession and deserves punishment. In short, a lawyer's unjustified
withholding of money belonging to his client, as in this case, warrants the imposition of
disciplinary action.
the relationship of attorney and client has consistently been treated as one of special
trust and confidence. An attorney must therefore exercise utmost good faith and
fairness in all his relationship with his client. Measured against this standard,
respondent's act clearly fell short and had, in fact, placed his personal interest above
that of his clients. Considering the foregoing violations of his lawyer's oath, Article
1491(5) of the Civil Code, Rule 9.02, Canon 9, and Canon 16 of the CPR, the Court
deems it appropriate to impose upon respondent the penalty of six (6) months
suspension from the practice of law.
WHEREFORE, we find Atty. Jaime S. Linsangan LIABLE for violations of his lawyer's
oath, Article 1491(5) of the Civil Code, Rule 9.02, Canon 9, and Canon 16 of the Code
of Professional Responsibility and he is hereby SUSPENDED from the practice of law
for SIX (6) months effective from the date of his receipt of this Decision. Let copies of
this Decision be circulated to all courts of the country for their information and guidance,
and spread in the personal record of Atty. Linsangan.
Atty. De Vera contends that he is only exhausting all the available legal remedies, and
that the charges filed against members of the Mercado family were done in good faith.
Issue: Whether or not Atty. De Vera violated the Code of Professional Responsibility by
instituting baseless and unwarranted suits that are only aimed to harass Mercado and
her family.
Held: Atty. De Vera was found guilty of violating the lawyer’s oath and the Code of
Professional Responsibility for raising unfounded lawsuits against the Mercado family
and several IBP board members who recommended his suspension.
Such act is deemed retaliatory and is unbecoming of a member of the bar who should
uphold the integrity, honesty and dignity of the legal profession. Atty. De Vera was
disbarred permanently from practice
The facts as found by the Integrated Bar of the Philippines, Board of Governors (IBP-
BOG), are as follows:
On 02 June 1997, complainant retained the services of respondent of the Amora and
Associates Law Offices to represent and act as its legal counsel in connection with the
Riviera project (Annex "C" to "C-5" of the complaint). Respondent's legal services under
the said agreement include the following: issuance of consolidated title(s) over the
project, issuance of individual titles for the resultant individual lots, issuance of license
to sell by the Housing and Land Use Regulatory Board, representation before the SEC,
and services concerning the untitled lots included in the project. For the said legal
services, respondent charged complainant the amount of Php6,500,000.00 for which he
was paid in three different checks (Annexes "D" to "D3" of the complaint).
On 14 March 2000, another contract for services was executed by complainant and
respondent for the latter to act as its counsel in the reclassification by the Sangguniang
Bayan of Silang, Cavite of complainant's agricultural lot to "residential commercial
and/or recreational use" in connection with its Riviera project (Annexes "G" to "G4" of
the complaint). Under this contract, respondent was hired to "act as counsel and
representative of AFP-RSBS before the Sangguniang Bayan of Silang, Cavite in all
matters relative to the reclassification of the subject properties from agricultural to non-
agricultural uses." On 21 March 2000, respondent furnished complainant a copy of
Resolution No. MI-007, S of 2000 of the Sangguniang Bayan of Silang dated 21
February 2000 ("resolution") approving the conversion and was paid the amount of
Php1.8M (Annex "H" of the complaint). Notably, the resolution was passed on 21
February 2000 or a month before the signing of the said 14 March 2000 contract.
Clearly, when [the] 14 March 2000 contract was signed by complainant and respondent,
there was already a resolution of the Sangguniang Bayan of Silang approving the
conversion of complainant's properties to residential/commercial. Clearly, the Php1.8M
demanded and received by respondent is not justifiable for the sole and simple reason
that respondent could not have performed any service under the 14 March 2000
contract considering that the result sought by the complainant (reclassification) has
been fulfilled and completed as early as 21 February 2000. Respondent, must therefore,
be ordered to return this amount to complainant.
On 06 November 2000, complainant entered into another contract for legal services with
respondent for which the latter was paid the amount of Php14,000,000.00 to secure
Certificate of Registration and License to Sell from the SEC (Annexes "I" to "I-5" of the
complaint). In addition, complainant further paid respondent the following checks as
professional fees in obtaining the Certificate of Registration and Permit to Offer
Securities for shares and other expenses: EPCIB Check No. 443124 dated 13 February
2003 in the amount of Php1,500,000.00, CENB Check No. 74001 dated 29 February
2000 in the amount of Php6,754.00, CENB Check No. 70291 dated 15 September 1999
in the amount Php261,305.00, and LBP Check No. 48691 dated 26 January 2001 in the
amount of Php221,970.00.
Issue
The singular issue for the consideration of this Court is whether Atty. Amora should be
held administratively liable based on the allegations on the Complaint.
The Court's Ruling
The Court modifies the findings of the IBP-BOG and the penalty imposed on the
respondent who violated the 21.01 and 21.02 of the Code of Professional
Responsibility.
Additionally, by causing the filing of the complaint before the HLURB, the IBP-BOG
correctly points out that respondent must have necessarily divulged to Phil Golf and
used information that he gathered while he was complainant's counsel in violation of
Rules 21.01 and 21.02 of the CPR, which state:
Rule 21.01 - A lawyer shall not reveal the confidences or secrets of his client except;
(a) When authorized by the client after acquainting him of the consequences of the
disclosure;
(c) When necessary to collect his fees or to defend himself, his employees or
associates or by judicial action.
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.
The IBP-BOG properly found thus:
Using confidential information which he secured from complainant while he was the
latter's counsel, respondent accused his former client of several violations. In the
process, respondent disclosed confidential information that he secured from
complainant thereby jeopardizing the latter's interest. As discussed below, respondent
violated his professional oath and the CPR.