Canon 16

A lawyer shall hold in trust all moneys and

properties of his client that may come into his
possession.
Canon 16.02
Another obligation which flows from the highly
fiduciary relation between attorney and client
 “lawyer shall keep the funds of each
client separate and apart from his own
and those of others kept by him.”
o He should not commingle a
client’s money with that of
other clients and with his
private funds, nor use the
client’s money for his personal
purposes without the client’s
consent.
o He should report promptly the
money of his client that has
come to his possession.
o He should maintain a
reputation for honesty and
fidelity to private trust
Canon 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.”
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 of and in violation of
the trust reposed in him by the client.
 It is a gross violation of general
morality as well as of professional
ethics;
 it impairs the public confidence in the
legal profession and deserves
punishment.
Rule 16.03 of the Code, however, allows
 the lawyer to “apply so much thereof as
may be necessary to satisfy his lawful
fees and disbursements, giving notice
promptly thereafter to his client.”
o This provision assumes that the
client agrees with the 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,
 o in which case he may deduct
what is due him and remit the
balance to his client, with full
disclosure on every detail.
o Without the client’s consent,
the lawyer has no authority to
apply the client’s money for his
fees, but he should in instead
return the money to his client,
without prejudice to his filing a
case to recover his unsatisfied
fees.
Where there is disagreement as to the lawyer’s
fees, or when the client disputes the amount
claimed by the lawyer for being unconscionable,
 the lawyer should not arbitrarily apply
the funds in his possession to the
payment of his fees for it would be
violative of the trust relationship
between the attorney and client and
would open the door to possible abuse
by those who are less than mindful of
their fiduciary duty
o he may file the necessary action
to fix and recover the amount
of his fees.
Canon 16:04
“lawyer shall not borrow money from his client
unless the client’s interests 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.”
The rule consists of two parts.
 The first part,
o which prohibits a lawyer from
borrowing money from his
client
Reasons
 is intended to prevent
the lawyer from taking
advantage of his
influence over the
client.
o While the lawyer may borrow
money from his client where
the client’s interests are fully
protected by the nature of the
case he is handling for the client
or by independent advice from
another lawyer
 he should not abuse
the client’s confidence
by delaying payment.
 The second part of the rule,
o which prohibits a lawyer from
lending money to the client,
except when, in the interest of
justice, he has to advance
necessary expenses in a legal
matter he is handling, is
intended to assure the lawyer’s
 independent professional
judgment,

Reasons

 for if the lawyer acquires a financial

interest in the outcome of the case the
free exercise of his judgment may be
adversely affected.
 If the lawyer lends money to the client
in connection with the client’s case, the
lawyer in effect acquires an interest in
the subject matter of the case or an
additional stake in its outcome, either
of which may lead the lawyer to
consider his own recovery rather than
that of his client or to accept a
settlement which might take care of his
interest in the verdict to the sacrifice of
that of the client in violation of his duty
of undivided fidelity to the client’s
cause.
 he will violate his oath to conduct
himself as a lawyer with
o all good fidelity to his clients
and
o make lawyering a money-
making venture and not a
profession
Canon 17

A lawyer owes fidelity to the cause of his client

and he shall be mindful of the trust and
Benefits of giving fidelity to client
confidence reposed in him.
 A lawyer who performs his duty with
 No lawyer is obliged to act either as
adviser or advocate for every person diligence and candor not only protects
the interest of his client; he also serves
who may wish to secure his services. He
has the right to decline employment, the ends of justice, does honor to the
bar, and helps maintain the respect the
respect of the community to the legal
 Once he agrees to take up the cause of
profession
the client, the lawyer owes fidelity to
such cause and must always be mindful
of the trust and confidence reposed in  A lawyer who performs that duty with
diligence and candor not only protects
him.
the interest of his client; he also serves
the ends of justice, does honor to the
 He owes entire devotion to the interest
bar and helps maintain the respect of
of his client, warm zeal in the
the community to the legal profession.
maintenance and defense of his client’s
rights, and the exertion of his utmost
learning and ability to the end that
nothing be taken or withheld from his
client, save by the rules of law, legally
applied.

 No fear of judicial disfavor or public

unpopularity should restrain him from
the full discharge of his duty.

 He must serve the client with

competence and diligence, and
champion the latter’s cause with whole-
hearted fidelity, care, and devotion.

What Client is entitled

 In the judicial forum the client is

entitled to the benefit of any and every
remedy and defense that is authorized
by law, and he may expect his lawyer to
assert every such remedy or defense.
Canon 18.
A lawyer who accepts professional employment
from a client agrees that he
“shall serve his client with competence and
diligence.”
By accepting a retainer, he impliedly represents
that
expected to be acquainted with the
rudiments of law and legal procedure,
 and a client who deals with him has the
right to expect not just a good amount
of professional learning and
competence but also a wholehearted
fealty to the client’s cause
Accepting client

(a) he possesses the requisite degree of  By agreeing to be his client’s

learning, skill and ability which is necessary to counsel,
the practice of his profession and which others o a lawyer represents that
similarly situated possess he will exercise ordinary
diligence or that
(b) he will exert his best judgment in the reasonable degree of care
prosecution or defense of the litigation and skill having reference
entrusted to him; to the character of the
business he undertakes to
(c) he will exercise reasonable and ordinary
do, to protect his client’s
care and diligence in the use of his skill and in
interests and
the application of his knowledge to his client’s
o take all steps or do all acts
cause; and
necessary therefor,
(d) he will take such step as will adequately o and his client may
safeguard his client’s interest. reasonably expect him to
discharge his obligations
 Every case a lawyer accepts deserves diligently.
his full attention, skill and competence,  Thus, a lawyer who
regardless of its importance and delayed filing an
whether he accepts it for a fee or for action to revive a
free. judgment and
thereafter filed a
Rule 18.03 of the Code of Professional
complaint which
Responsibility enjoins a lawyer not to
was so defective
“neglect a legal matter entrusted to him, and that it did not
his negligence in connection therewith shall suspend the
render him liable.” prescriptive period
to file said action
 He must constantly keep in mind that betrayed his
his actions or omissions or nonfeasance client’s trust and
would be binding upon his client. He is did not champion
his cause with that
 wholehearted
fidelity, care and
devotion that a
lawyer is obligated
to give to every
case that he
accepts from a
client.
 
Clients expectation
 A client may reasonably expect that
his counsel will make good his
representations that he will
represent his client with
competence and diligence.
 In the absence of evidence to the
contrary, however, a lawyer is
presumed to be prompt and
diligent in the performance of his
obligations and to have employed
his best efforts, learning and ability
in the protection of his client’s
interests and in the discharge of his
duties as an officer of the court.
Canon 18.01
A lawyer shall not undertake a legal service
which he knows or should know that he is not
qualified to tender. However, he may render
such service if, with the consent of his client,
he can obtain as collaborating counsel a lawyer
who is competent on the matter.
A lawyer shall not accept employment
in a specific area of law nor undertake a
particular legal service which he knows
or should know he is not quantified to
render.
Clients expectation
 For by accepting professional
employment, he holds himself out to his
client that he is knowledgeable,
competent and skillful to handle the
case.
o Some cases involve specialized
fields of law and require special
training, of which a lawyer may
not be knowledgeable.
In such a case, he should follow Rule 18.01 of
the Code which provides that he “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
the consent of his client, he can obtain as
collaborating counsel a lawyer who is
competent on the matter
Canon 18.02
A lawyer owes his client and the court the duty
to be adequately prepared to try the client’s
case. Rule 18.02 of the Code requires that he
“shall not handle any legal matter without
adequate preparation.”
The key to the problem of how best a lawyer
can safeguard
 his client’s rights and interests is
thorough study and preparation.
 The full protection of the client’s
interests requires no less than a
mastery of the applicable law and the
facts involved in a case, regardless of
the nature of the assignment
How to
 He must keep constantly abreast of
the latest jurisprudence and
developments in all branches of the
law.
o For only by keeping himself
well-informed of the latest
rulings of the Supreme
Court on the issues and
problems confronting his
client will he be able to fully
advance his client’s cause.
A lawyer owes that duty not only to his client
but to the court, to the bar and to himself.
 That most cases are won within the
four walls of the attorney’s study
room and before he goes to court
requires no elaboration. Moreover,
to be able to put up a good fight in
the courtroom, hard work and
intensive study and preparation are
the only guarantees of coming out
unscathed.
On the other hand, inadequate
preparation
 spawns adverse effects that go far
beyond the personal interest of the
client.
Effrects
 Any attempted presentation of a
case without adequate preparation
distracts the administration of
justice and discredits the bar.
 And when the merits of one side of
a case are not properly presented
because of inadequate legal
representation as against the merits
of the other well-presented side,
 the court may be and often is
misled into looking at the case in an
uneven light.
Careless preparation,
 moreover, may cast doubt upon the
lawyer’s intellectual honesty and
capacity.
 Apart from that, it may not only prove
embarrassing to himself; it may also, for
ethical lapses occasioned thereby,
furnish ground for and subject him to
disciplinary action or contempt of court.
Canon 18. 03
A lawyer shall not neglect a legal matter
entrusted to him, and his negligence in
connection therewith shall render him liable.”
The failure to exercise due diligence or the
abandonment of the client’s cause makes the
lawyer unworthy of the trust which the client
has reposed in him. It is a breach of his
undertaking with his client. To warrant
suspension or disbarment, however, the
negligence or carelessness in the performance
of duty should not only be gross in character149
but should have caused material prejudice to
the client’s interest as well, Mere negligence or
inattention which produces no pecuniary
damage to the client may only justify reprimand
or censure151 except when the breach of duty
to client also constitutes a gross violation of
obligation to the court, in which case a severer
sanction, such as suspension from the practice
of law, may be warranted
The act of receiving money as acceptance fee
for legal services in handling complainant’s case
and subsequently failing to render such services
is a clear violation of Canon 18 of the Code of
Professional Responsibility which provides that
a lawyer shall serve his client with competence
and diligence. More specifically, Rule 18.03
states:
A member of the legal profession owes his
client entire devotion to his genuine interest,
warm zeal in the maintenance and defense of
his rights. An attorney is expected to exert his
best efforts and ability to preserve his client’s
cause, for the unwavering loyalty displayed to
his client likewise serves the ends of justice.
Verily, the entrusted privilege to practice law
carries with it the corresponding duties, not o*
Jy to the client, but also to the court, to the bar
and to the public. In Santos vs. Lazaro, we held
that Rule 18.03 of the Code of Professional
Responsibility, above-quoted, is a basic
postulate in legal ethics. Indeed, when a lawyer
takes a client’s cause, he covenants that he will
exercise due diligence in protecting his rights.
The failure to exercise that degree of vigilance
and attention expected of a good father of a
family makes such lawyer unworthy of the trust
reposed in him by his client and
There is no hard and fast rule as to what is gross
misconduct in the performance of the lawyer’s
duty to his client. That question depends upon
the circumstances of the case, the nature of the
act done and the motive which induced him to
do the act charged. The prejudice which may
arise as a consequence of the lawyer’s
negligence or carelessness consists of an
unfavorable order or judgment against the
client, which the court may issue upon the
lawyer’s failure to appear at the scheduled
hearing,164 take steps to prosecute a case,155
perfect an appeal,156 pay the required fees,157
claim his mails containing judicial notices or
decisions158 or file the appellant’s brief.159 If
the material prejudice to the client is the result
of the lawyer’s gross or inexcusable negligence,
the lawyer may not only be disciplined for such
misconduct160 but may also be held liable for
damages
A lawyer may also be disciplined for inexcusable
ignorance of the law. Thus, a lawyer has been
suspended from the practice of law for his
failure to advise his client that it was irregular
for the vendor-a-retro to have in his possession
the original certificate of title as basis for the
preparation of the deed because only the
Register of Deeds is supposed to have physical
possession thereof and for notarizing the deed,
which caused the client to be swindled by the
vendor as the latter had previously sold the
same land to another based on the owner’s
duplicate copy of the title.164 However, since
he is not expected to know all the laws, he is
not liable for an honest mistake or error.165
Pressure and large volume of legal work provide
no excuse for the lawyer’s inability to exercise
the performance of his duty to take the
necessary steps to protect his client’s interest.
Every case a lawyer accepts deserves his full
attention, skill and competence, regardless of
its importance and whether he accepts it for a
fee or for free. Canon 18 of the Code requires
the lawyer to do no less, short of which he may
be disciplined therefor, which may be a fine,
suspension from practice, or even disbarment,
depending upon the circumstances of each
case.

Ordinarily, reprimand, fine, or suspension may

be imposed against erring lawyers for
negligence in the performance of duties to their
clients. However, where the negligence is gross
and inexcusable, and results in material
prejudice and huge monitary damage to the
client, the erring lawyer may be disbarred. T