canon 16 and canon 17 (without other rules)-- cases
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1LEGAL ETHICS ASSIGNED CASE READINGS
CANON 16
Republic of the Philippines
SUPREME COURT
Manila
EN BANC
A.C. No. 2591 September 8, 2006
LETICIA ADRIMISIN,complainant,vs.
ATTY. ROLANDO S. JAVIER,respondent.
D E C I S I O N
CARPIO, J.:
The Case
On 12 September 1983, Leticia Adrimisin ("complainant") filed a
complaint-affidavit1with the Ministry of Justiceseeking the
disbarment of Atty. Rolando S. Javier ("respondent") for deceit
and misrepresentation.
The Facts
Complainant alleges that on 12 July 1983, she was introduced by
her cousin, Pablo Adrimisin, to respondent. She needed the help
of a lawyer in having her son-in-law, Alfredo Monterde
("Monterde"), who was charged with the crime of qualified theft,
released from the Caloocan City Jail. Complainant claims that
respondent advised her to file a bail bond. Complainant informed
respondent that her only money was P500. Complainant contends
that respondent received the money, issued a receipt2and
promised that Monterde would be released from jail the followingday.
Complainant also alleges that respondent failed to keep his
promise in having Monterde released. Complainant went to
respondent's office several times but it seemed that respondent
was avoiding her. Monterde was later released upon settlement of
the case with his employer. Complainant claims that she
demanded for the return of the P500 but respondent failed to
return this amount.
Respondent did not file any comment or answer. He only
appeared in the investigative hearings conducted by the Office of
the Solicitor General ("OSG"). Respondent, in his testimony,
claims he was not hired by complainant aslegal counsel.
Respondent alleges complainant only asked his help to secure a
bail bond.3Respondent admits he received P500 for the bail bond
and called up Carlos Alberto ("Alberto"), an insurance
agent.4Respondent claims he gave the P500 to Alberto. However,
the amount was not sufficient to pay for the bond.5Respondentdenies that he promised to have Monterde released
immediately.6Respondent claims he advised complainant to get
back her money directly from Alberto.7
Alberto, the insurance agent, was presented during the hearing.
He testified that on 20 July 1983, respondent came to him to
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2LEGAL ETHICS ASSIGNED CASE READINGS
secure a bail bond for qualified theft.8Alberto showed a copy of
the personal bail bond dated 20 July 1983, issued
by Philippine Phoenix Surety & Insurance, Inc. ("Philippine
Phoenix Surety") with a premium ofP940 and costs of
documentary stamps, notarial fees and clearances at P279 fora total of P1,219.9Alberto claimed he issued a genuine bond but it
was not filed in court because complainant failed to pay the
balance.10He also testified that Pablo Adrimisin asked for the
refund of the P500 but the amount could not be refunded due
to expenses already incurred and forfeiture of the remainder in
favor of Alberto's office.11
The bail bond which was marked as Exhibit "1" contained a
stamped "Limitation of Liability" clause. The clause states"Authorized limit of the bond shall not exceed P20,000 and it is
not valid for theft and robbery cases."12The portion "Not valid for
theft and robbery cases" was deleted with a marking pen but this
cancellation was not signed or initialed. Alberto was asked why
the cancellation was unsigned. Alberto replied that he had no
knowledge on who made the stamp or the cancellation.13When
asked if it is the policy of Philippine Phoenix Surety not to post
personal bail bond with respect to theft and robbery cases,
Alberto answered in the affirmative.14
Alberto also clarified that he is not connected with Philippine
Phoenix Surety but he is an employee of the House of Bonds,
which is the general agent of the former.15
Mr. Alfredo Brigoli ("Brigoli"), General Manager of the House of
Bonds, was also presented as one of respondent's witnesses.
Brigoli explained that he gives Alberto 5 sets of pre-signed bail
bond forms.16However, in theft, robbery and drug cases, Alberto
is required to seek his approval before the bond is issued.
Brigoli testified that it was Alberto's daughter who called him upfor approval to issue a bond for qualified theft.17He informed
Alberto's daughter to bring the original bond and its duplicate
copies to his office in Intramuros for his signature, but the same
was not done.18Due to the lack of his signature, Brigoli claimed
that the bond has not been approved.19Brigoli also testified that
since the bond was not forwarded to his office, the same was not
recorded and the payment was not remitted.
The OSG's Report and Recommendation
The OSG's Investigating Solicitor Antonio G. Castro heard the case
and submitted a Report and Recommendation ("Report"). The
OSG recommended that respondent be suspended from the
practice of law for not less than one year. The Report reads:
The charge of deceit and misrepresentation against respondent
has been sufficiently established. Respondent himself admits that
he received from complainant the sum of P500.00 for the bail
bond of complainant's son-in-law Alfredo Monterde; that he failed
to secure Monterde's release from jail; and that he did not return
the sum of P500.00 to complainant (pp. 9-20, tsn, March 14,
1985).
x x x x
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3LEGAL ETHICS ASSIGNED CASE READINGS
Respondent's defense that he actually secured a bail bond for
Monterde is a mere afterthought. Firstly, complainant confided to
him that she had no more money except P500.00. He would not,
therefore, secure a bail bond with higher premium than P500.00.
Secondly, while he declared that the records of Monterde's case in
the Regional Trial Court in Caloocan City, Branch XXV, sala of
Judge Oscar Herrera showed that the recommended bail
was P8,000.00 (pp. 8-9, tsn, March 14, 1985), the personal bail
bond, marked as Exhibit "1", which was allegedly prepared, was
forP9,400.00 (Exh. "1", p. 7, Folder of Exhs.).
Thirdly, respondent's witness, Alfredo Brigoli, the general manager
of the AAF House of Bonds, admitted that Exhibit "1" was not
finally approved. On cross-examination, he declared:
"Q Have you signed that as finally approved?
A No, sir. When they called up asking for my signature on the
deleted portion of the bond, Mr. Alberto never came to my office.
Q In other words that bond has not been finally approved.
A Not finally approved because there is no signature yet."
(p. 20, tsn, Sept. 30, 1985).
As held by this Honorable Court in Royong v. Oblena, 7 SCRA 859,
868-869 (1963), "The respondent's misconduct, although
unrelated to his office, may constitute sufficient grounds for
disbarment." And in Quingwa v. Puno, 19 SCRA 439, 445 (1967),
it also held that, "Indeed, it is important that members of this
ancient and learned profession of law must conform themselves in
accordance with the highest standards of morality."
Specifically, for deceit and misrepresentation, respondent may be
suspended or disbarred (In re Paraiso, 41 Phil. 24, 25 [1920]).
20
The Court's Ruling
The Court finds respondent liable for violation of Canon 16 and
Rule 18.03 of the Code of Professional Responsibility ("Code").
The Code mandates every lawyer to hold in trust all moneys and
properties of his client that may come into his
possession.21Consequently, a lawyer should account for the
money received from a client.22The Code also enjoins a lawyer
not to neglect a legal matter entrusted to him,23
and hisnegligence in connection therewith shall render him liable.
Respondent himself admitted the receipt of P500 from
complainant as payment for the bail bond as shown in
histestimony and in Exhibit "A". By his receipt of the amount,
respondent agreed to take up complainant's cause and owed
fidelity to complainant and her cause, even if complainant never
paid any fee. Lawyering is not a business. It is a profession in
which duty to public service, not money, is the primary
consideration.24
Respondent claims that on 12 July 1983, he called up Alberto for
the issuance of the bail bond but it took 8 days before the bail
bond was prepared. In failing to immediately secure the bail bond,
respondent clearly neglected to exercise ordinary diligence or that
reasonable degree of care and skill required by the circumstances.
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4LEGAL ETHICS ASSIGNED CASE READINGS
There were also irregularities in the personal bail bond. Firstly, it
was issued on 20 July 1983 but notarized sometime in 1984 as
seen in the Notarial Certificate. The Court therefore agrees with
OSG's finding that respondent's defense that he secured a bail
bond was a mere afterthought. Furthermore, complainant filed hercomplaint on 12 September 1983, which means that the bond was
notarized only after the complaint was filed. Secondly, the bail
bond was not valid for theft and robbery cases. Although there
was a cancellation of such phrase through marking pen, the same
was not countersigned, and hence the cancellation was void.
Thirdly, the payment for the bond was not recorded and neither
was it remitted to the issuer of the bond. This means that the
bond was a mere piece of paper without any value for it failed to
serve its purpose.
Complainant demanded for the return of the P500 but respondent
kept on insisting that complainant seek refund from Alberto.
Respondent has the duty to account for the money entrusted to
him by complainant. In Parias v. Paguinto,25we held that "a
lawyer shall account for all money or property collected from the
client. Money entrusted to a lawyer for a specific purpose, such as
for filing fee, but not used for failure to file the case must
immediately be returned to the client on demand." In the present
case, money for the payment of the bond's premium was not used
for the purpose intended. Hence, respondent must return the
amount to complainant upon demand.
A lawyer's failure to return upon demand the funds held by him
on behalf of his client gives rise to the presumption that he has
appropriated the same for his own use in violation of the trust
reposed in him by his client. Such act is a gross violation of
general morality as well as of professional ethics. It impairs public
confidence in the legal profession and deserves punishment.26
This is not the first time respondent is found to have unlawfullywithheld and misappropriated money. In Igual v. Javier,27the
Court held that respondent had unjustifiably refused to return
Igual's money upon demand and his absence of integrity was
highlighted by his "half-baked excuses, hoary pretenses and
blatant lies in his testimony before the IBP Committee on Bar
Discipline." The Court suspended Javier from the practice of law
for a period of one month and ordered him to restitute the
amount of P7,000 to Igual. In that case, we reminded respondent
that he was "expected to always live up to the standardsembodied in the Code of Professional Responsibility for the
relationship between an attorney and his client is highly fiduciary
in nature and demands utmost fidelity and good faith."28
We reiterate this reminder. Lawyers who convert the funds
entrusted to them are in gross violation of professional ethics and
are guilty of betrayal of public confidence in the legal
profession.29Those who are guilty of such infraction may be
disbarred or suspended from the practice of law.30
WHEREFORE, we SUSPENDAtty. Rolando S. Javier from thepractice of law for SIX MONTHS effective upon finality of thisDecision. We ORDER respondent to restitute complainant Leticia
Adrimisin the Five Hundred Pesos (P500) with legal interest
computed from 12 September 1983 until full payment.
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5LEGAL ETHICS ASSIGNED CASE READINGS
Respondent shall submit to the Court proof of restitution within
ten (10) days from payment.
Let copies of this resolution be furnished the Office of the Bar
Confidant to be appended to respondent's personal record, andthe Integrated Bar of the Philippines. The Court Administrator
shall furnish copies to all courts of the land for their information
and guidance.
SO ORDERED.
Panganiban, C.J., Puno, Quisumbing, Ynares-Santiago, Sandoval-
Gutierrez, Austria-Martinez, Corona, Carpio-Morales, Callejo, Sr.,
Azcuna, Tinga, Chico-Nazario, Garcia, Velasco, Jr., J.J.,concur.
Republic of the Philippines
SUPREME COURTManila
EN BANC
A.C. No. 7057 July 25, 2006
DAVID L. ALMENDAREZ, JR.,complainant,vs.
ATTY. MINERVO T. LANGIT,respondent.
D E C I S I O N
CARPIO,J.:
The Case
On 5 May 2004, David L. Almendarez, Jr. ("complainant") filed this
complaint-affidavit1before the Integrated Bar of the Philippines
(IBP), seeking the disbarment of Atty. Minervo T. Langit
("respondent") for acts unbecoming alawyer.
The facts are undisputed:
Complainant, as attorney-in-fact of his mother Pura Lioanag Vda.de Almendarez, was the plaintiff in an ejectment case before the
Municipal Trial Court of Dagupan City, Branch 2 ("trial court").
Respondent served as complainant's counsel. While the case was
pending, defendant Roger Bumanlag ("Bumanlag")
deposited monthly rentals for the property in dispute to the
Branch Clerk of Court.
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6LEGAL ETHICS ASSIGNED CASE READINGS
On 3 February 1994, the trial court rendered a decision in the
ejectment case based on a compromise agreementexecuted by
complainant and Bumanlag. On 18 December 1995, the trial court
issued an alias writ of execution for the satisfaction of the
decision. A court order2dated 2 March 2000 granted the OmnibusMotion for Execution andWithdrawal of Deposited Rentals filed by
respondent as complainant's counsel. Respondent filed a second
motion for withdrawal of deposited rentals, which the trial court
also granted on 16 March 2000.
Sometime in May 2003, complainant learned that respondent was
able to withdraw the rentals deposited by Bumanlag. Felicidad
Daroy ("Daroy"), Officer-in-Charge Clerk of Court, confirmed this
to complainant who received from Daroy copies of the two
withdrawal slips drawn from the trial court's savings account. One
slip dated 10 March 2000 was for P28,000,3and another slip
dated 19 April 2000 was for P227,000.4Thus, respondent received
a total of P255,000, as evidenced by two receipts5signed by him.
The withdrawals were made through Daroy's authorized
representative Antonia Macaraeg, but Daroy personally delivered
the money to respondent. Respondent did not inform complainant
of these transactions.
Complainant, through his new counsel Atty. Miguel D. Larida, sentrespondent on 30 June 2003 a final demand letter for the
accounting and return of the P255,000.6Respondent failed to
reply.
Hence, complainant filed this case for disbarment against
respondent for failing to account for complainant's funds.
Complainant further accuses respondent of neglecting to pursue
the implementation of the writ of execution issued in the
ejectment case.
On 12 May 2004, IBP Director for Bar Discipline Rogelio A. Vinluan("IBP Director Vinluan") ordered respondent to submit his Answer
to the complaint. Respondent did not file an answer despite
receipt of the notice.7
On 4 October 2004, IBP Investigating Commissioner Caesar R.
Dulay ("IBP Commissioner Dulay") notified the parties to appear
before him for a mandatory conference on 15 November 2004,
later reset to 17 January 2005. Only complainant appeared at the
conference, prompting IBP Commissioner Dulay to order the
conference terminated and to declare that respondent had waivedhis right to participate in the proceedings. IBP Commissioner
Dulay directed the parties to file their respective position papers.
Complainant submitted his position paper on 22 March 2005.
Again, respondent took no action.
Findings and Recommendation of the IBP
On 8 June 2005, IBP Commissioner Dulay submitted
his Report and Recommendation ("Report")8with the finding that
respondent failed to account for money he held in trust for
complainant. The Report considered complainant's evidence "clear
and convincing" enough to justify disciplinary action against
respondent for violation of Rule 16.01 of the Code of Professional
Responsibility. IBP Commissioner Dulay recommended that
respondent be declared guilty of gross misconduct and suspended
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for one year, aside from being ordered to render an accounting of
the money he had received.
In a Resolution9dated 17 December 2005, the IBP Board of
Governors approved the Report, with the modification that thepenalty of suspension be increased to two years.
The Court's Ruling
We sustain the findings of the IBP.
Respondent committed a flagrant violation of his oath when he
received the sum of money representing the monthly rentals
intended for his client, without accounting for and returning such
sum to its rightful owner. Respondent received the money in his
capacity as counsel for complainant. Therefore, respondent held
the money in trust for complainant. The Code of Professional
Responsibility ("Code") states:
CANON 16 A LAWYER SHALL HOLD IN TRUST ALL MONEYS
AND PROPERTIES OF HIS CLIENT THAT MAY COME INTO HIS
POSSESSION.
Rule 16.01A lawyer shall account for all money or property
collected or received for or from the client.
Rule 16.03A 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.
Respondent should have immediately notified complainant of the
trial court's approval of the motion to withdrawthe deposited rentals. Upon release of the funds to him,
respondent could have collected any lien which he had over them
in connection with his legal services, provided he gave prompt
notice to complainant. 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.10In this case, respondent did
not even seek to prove the existence of any lien, or any other
right that he had to retain the money.
Respondent's failure to turn over the money to complainantdespite the latter's demands gives rise to the presumption that he
had converted the money for his personal use and benefit. This is
a gross violation of general morality as well as of professional
ethics, impairing public confidence in the legal profession.11More
specifically, it renders respondent liable not only for violating the
Code but also for contempt, as stated in Section 25, Rule 138 of
the Rules of Court:
SEC. 25. Unlawful retention of client's funds; contempt Whenan attorney unjustly retains in his hands money of his client after
it has been demanded he may be punished for contempt as
an officer of the Court who has misbehaved in his official
transactions; but proceedings under this section shall not be a bar
to a criminal prosecution.
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Additionally, respondent failed to observe Canon 1712of the Code,
which obligates the lawyer to take up the cause of his client with
entire zeal and devotion. It seems that after respondent received
the withdrawn deposits, he never contacted complainant again.
He did not pursue the implementation of the writ of executionissued in the ejectment case, to the prejudice of complainant. By
his inaction, respondent violated the trust and confidence reposed
in him. For in agreeing to be complainant's counsel, respondent
undertook to take all steps necessary to safeguard complainant's
interest in the case.
The misconduct of respondent is aggravated by his unjustified
refusal to heed the orders of the IBP requiring him to file an
answer to the complaint-affidavit and, afterwards, to appear at
the mandatory conference. Although respondent did not appear at
the conference, the IBP gave him another chance to defend
himself through aposition paper. Still, respondent ignored this
directive, exhibiting a blatant disrespect for authority. Indeed, he
is justly charged with conduct unbecoming a lawyer, for a lawyer
is expected to uphold the law and promote respect for legal
processes.13Further, a lawyer must observe and maintain respect
not only to the courts, but also to judicial officers and other duly
constituted authorities,14including the IBP. Under Rule 139-B of
the Rules of Court, the Court has empowered the IBP to
conduct proceedings for the disbarment, suspension, or discipline
of attorneys.
The relation of attorney and client is highly fiduciary, requiring
utmost good faith, loyalty, and fidelity on the part of the attorney.
Respondent miserably failed in this regard. Instead, he
demonstrated a lack of integrity, care, and devotion required by
the legal profession from its members. Whenever a lawyer is no
longer worthy of the trust and confidence of the public, this Court
has the right and duty to withdraw his privilege as officer of the
Court and member of the Bar.15
WHEREFORE,we find Atty. Minervo T. Langit GUILTYofviolating Canons 1, 11, 16, and 17 of the Code of Professional
Responsibility. We SUSPENDrespondent from the practice of lawfor two years effective upon finality of this Decision.
We ORDERrespondent to RESTITUTE, within 30 days fromfinality of this Decision, complainant'sP255,000, with interest at
12% per annum from 30 June 2003 until fully paid.
We DIRECTrespondent to submit to the Court proof of paymentwithin 15 days from payment of the full amount.
Let copies of this Decision be furnished all courts, the Office of the
Bar Confidant, as well as the Integrated Bar of the Philippines, for
their notice and guidance.
SO ORDERED.
Panganiban, C.J., Puno, Quisumbing, Ynares-Santiago, Sandoval-
Gutierrez, Austria-Martinez, Corona, Carpio-Morales, Callejo, Sr.,
Azcuna, Tinga, Chico-Nazario, Garcia, Velasco, Jr., J.J.,concur.
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EN BANC
[A.C. NO. 4562 : June 15, 2005]
DANIEL MORTERA, TERESITA MORTERA, FERDINAND
MORTERA and LEO MORTERAComplainants, v.ATTY.RENATO B. PAGATPATAN,Respondent.
R E S O L U T I O N
CORONA, J.:
How far may a lawyer go to ensure that he gets paid?cralawlibrary
The answer to this question is stated clearly in Canon 16 of the
Code of Professional Responsibility for Lawyers1
andin decisions2applying the same, but it is apparently not plain
enough to the respondent in this case. It therefore behooves us to
make an example of him for the improvement of the legal
profession.
This disbarment case originated from the execution of a judgment
in a civil action for "rescission of contracts with a prayer for
prohibitory mandatory injunction."3
In brief, the complainants, then the plaintiffs, sued their mother,one Renato C. Aguilar and one PhilipArnold Palmer Bradfield for
the rescission of a contract of sale. They secured judgment under
which Aguilar was to pay them P155,000 for the property, which
this Court affirmed.4
On April 15, 1994, respondent did the unthinkable. Under
a secret agreement with Aguilar, he accepted P150,000 from the
latter as partial payment of the judgment sum, issuing a receipt
for the amount.5He then deposited the money in his
personal bank account without the knowledge ofcomplainants.6Until now, respondent adamantly refuses
to surrender the money to complainants, despite the successive
Orders of the RTC and the Court of Appeals.7
For his part, respondent, in his comment8admits his secret
agreement with and receipt of the money from Aguilar,
interposing as his defense the fact that the complainants and their
mother owed him the money he appropriated for services
previously rendered. They would not have paid him his fees had
he not done what he did.9In support of his argument, the
respondent narrated his years of service as counsel for the
complainants and their mother. He alleged the amounts they
owed him although he presented no evidence of any agreement
between him and the complainants for the exact amount of
his compensation.
Respondent's responsibility to the complainants is unequivocally
stated in Canons 15 and 16 of the Code of Professional
Responsibility. The four rules governing this situation were: heowed candor to his clients;10he was bound to account for
whatever money he received for and from them;11as a lawyer, he
was obligated to keep his own money separate from that of his
clients;12and, although he was entitled to a lien over the funds in
order to satisfy his lawful fees,13he was also bound to give
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prompt notice to his clients of such liens and to deliver the funds
to them upon demand or when due.
Respondent violated each and every one of these rules.
Respondent cited the need to protect the money from other
persons claiming to be heirs of Eusebio Montera14and from the
volatile temperament of the complainants15but did not present
any evidence at all to prove either claim. Thus, these claims
should be ignored.
Because the respondent admitted concealing his clients' money,
the only question in our minds is how severe his punishment
should be.
The Board of Governors of the Integrated Bar of the Philippines
resolved16to suspend the respondent for one year.
We do not agree.
InAldovino v. Pujalte,17respondent Atty. Pedro C. Pujalte similarly
faced disbarment charges for having withheld his clients' money in
violation of Canon 16. Pujalte alleged a lien for his fees over the
contested amount but adduced no evidence of this supposed lien.
In disposing of that case, we said:
Respondent has no right to retain or appropriate unilaterally, as
lawyer's lien, the sum of P250,000, as attorney's fees. In fact, he
did not adduce any proof of such agreement. His mere allegation
or claim is not proof. Obviously, his failure to return the money to
complainants upon demand gave rise to the presumption that he
misappropriated it in violation of the trust reposed on him. His act
of holding on to their money without their acquiescence is conduct
indicative of lack of integrity and propriety. He was clinging to
something not his and to which he had no right.
As a penalty for his infraction, Atty. Pujalte was suspended for a
year.
However, in the more recent case of de Guzman Buado and Lising
v. Layag18which involved a violation of Canons 15, 16 and 17, the
Court En Bancimposed the much heavier penalty of indefinite
suspension.
In that case, Atty. Eufracio Layag, the lawyer of the complainants
Lising and de Guzman, successfully prosecuted a case againstInland Trailways, Inc. (Inland). Pursuant to the judgment, Inland
issued three checks, one payable to Layag, one payable to Lising
and one payable to de Guzman who had already passed away by
then. Layag received all three checks from the deputy sheriff but
did not inform the complainants. He then gave them to one Marie
Paz Gonzales for encashment on the strength of a special power
of attorney (SPA) purportedly executed by the late de Guzman
appointing her as his attorney-in-fact. This SPA authorized
Gonzales to encash any check or bill of exchange received insettlement of the case. Even after complainants learned of the
issuance of the checks two years later and demanded delivery of
the proceeds, Layag refused to do so.
In imposing upon Layag the penalty of indefinite suspension, the
Court En Bancconsidered his years of experience as a lawyer, his
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ignorance of the law, specifically the Civil Code, and his violation
of not one but three Canons.
Even though, on its face, this case has more in common
with Pujaltethan with Layag, a one-year suspension seems toolenient for a number of reasons.
First, the respondent in this case has been a practicing lawyer
since 197419and even runs his own small law firm. For all his vast
experience, however, he claims that he has done nothing wrong
by concealing and withholding his clients' money from
them.20Coming from a seasoned practitioner of the law, this
attitude is inexcusable.
Second, the respondent had other means of recovering his fees,having filed a case for that purpose which was, however,
dismissed for his failure to properly implead an indispensable
party.21In short, having botched his own effort to recover his
fees, he sought to simply subvert both law and proper procedure
by holding on to the money.
Clearly, the respondent's actuations were thoroughly tainted with
bad faith, deceit and utter contempt of his sworn duty as a
lawyer. Thus, a heavier penalty than a mere one-year suspension
is definitely called for.
WHEREFORE, the IBP Board of Governors Resolution No. XV-2002-223 in Administrative Case No. 4562, finding respondent
liable for violation of Canon 16 of the Code of Professional
Responsibility is herebyAFFIRMEDwiththe MODIFICATIONthat instead of a one-year suspension, Atty.
Renato B. Pagatpatan is hereby SUSPENDEDfrom the practiceof law for two years.
Respondent is further directed to turn over to the complainants,
within five (5) days from receipt of this resolution, the P150,000he received in their behalf.
Respondent is also ORDERED to report to the Office of the BarConfidant his compliance herewith within 15 days from such
compliance.
Let a copy of this Resolution be attached to the personal record of
Atty. Renato B. Pagatpatan and copies furnished the Integrated
Bar of the Philippines and the Office of the Court Administrator for
dissemination to all courts.
This Resolution is immediately executory.
SO ORDERED.
Davide, Jr., C.J., Puno, Panganiban, Quisumbing, Ynares-Santiago, Sandoval-Gutierrez, Carpio, Austria-Martinez,Carpio-Morales, Callejo, Sr., Azcuna, Tinga, Chico-Nazario,and Garcia, JJ., concur.
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EN BANC
A.C. No. 5829 October 28, 2003
DANIEL LEMOINE,complainant,vs.
ATTY. AMADEO E. BALON, JR.,respondent.
D E C I S I O N
PER CURIAM:
On December 17, 1999, complainant Daniel Lemoine, a French
national, filed a verified complaint1
against respondent Atty.Amadeo E. Balon, Jr., for estafa and misconduct before the
Integrated Bar of the Philippines. The case, docketed as CBD Case
No. 99-679, was referred by the Commission on Bar Discipline to
an Investigator for investigation, report and recommendation.
The facts that spawned the filing of the complaint are as follows:
In early 1998, complainant filed a car insurance claim with the
Metropolitan Insurance Company (Metropolitan Insurance), the
insurer of his vehicle which was lost. As complainant encounteredproblems in pursuing his claim which was initially rejected,2his
friend, a certain Jesus "Jess" Garcia (Garcia), arranged for the
engagement of respondents services.
By letter3of October 21, 1998 addressed to Elde
Management, Inc., "ATTN: Mr. Daniel Lemoine," under whose
care complainant could be reached, respondent advised
complainant, whom he had not before met, that for hislegal
services he was charging "25% of the actual amount being
recovered. . . payable upon successful recovery;" an advance
payment of P50,000.00 "to be charged [to complainant] to bededucted from whatever amount [would] be successfully
collected;" P1,000.00 "as appearance and conference fee for each
and every court hearings, conferences outside our law office and
meetings before the Office of the Insurance Commission which
will be also charged to our 25% recovery fee;" and legal expenses
"such as but not limited to filing fee, messengerial and postage
expenses . . . and other miscellaneous but related expenses," to
be charged to complainants account which would be reimbursed
upon presentation of statement of account.
The letter-proposal of respondent regarding attorneys fees does
not bear complainants conformity, he not having agreed
therewith.
It appears that Metropolitan Insurance finally offered to settle
complainants claim, for by letter4of December 9,1998 addressed
to it, respondent confirmed his acceptance of its offer to settle the
claim of complainant "in an ex-gratia basis of 75% of his policy
coverage which is therefore FIVE HUNDRED TWENTY FIVETHOUSAND (P525,000.00) PESOS."
A day or a few days before December 23, 1998 when complainant
left for France,5he, on the advice of respondent, signed an
already prepared undated Special Power of Attorney6authorizing
respondent and/or Garcia to bring any action against Metropolitan
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Insurance for the satisfaction of complainants claim as well as to
"negotiate, sign, compromise[,] encash and receive payment"
from it. The Special Power of Attorney was later dated December
23, 1998 on which same date Metropolitan Insurance issued a
Chinabank Check No. 841172 payable to complainant in theamount of P525,000.00 as full settlement of the claim.7The check
was received by respondent.
In the meantime, complainant returned to the Philippines in early
January 1999 but left again on the 24th of the same month.8On
inquiry about the status of his claim, Garcia echoed to
complainant what respondent had written him (Garcia) in
respondents letter9of March 26, 1999 that the claim was still
pending with Metropolitan Insurance and that it was still subject
of negotiations in which Metropolitan Insurance offered to settle it
for P350,000.00representing fifty percent thereof. In the same
letter to Garcia, respondent suggested the acceptance of the offer
of settlement to avoid a protracted litigation.
On December 6, 1999, on complainants personal visit to
the office of Metropolitan Insurance, he was informed that his
claim had long been settled via a December 23, 1998 check given
to respondent the year before.10Complainant lost no time in going
to the law office of respondent who was not around, however, butwhom he was able to talk by telephone during which he
demanded that he turn over the proceeds of his claim.11
Respondent thereupon faxed to complainant a December 7, 1999
letter12wherein he acknowledged having in his possession the
proceeds of the encashed check which he retained, however, as
attorneys lien pending complainantspayment of his attorneys
fee, equivalent to fifty percent (50%) of entire amount collected.
In the same letter, respondent protested what he branded as the
"uncivilized and unprofessional behavior" complainant "reportedly
demonstrated" at respondents office. Respondent winded up hisletter as follows, quoted verbatim:
We would like to make it clear that we cannot give you the
aforesaid amount until and unless our attorneys fees will be
forthwith agreed and settled. In the same manner, should you be
barbaric and uncivilized with your approached, we will not hesitate
to make a proper representation with the Bureau of Immigration
and Deportation for the authenticity of your visa, Department of
Labor and Employment for your working status, Bureau of
Internal Revenue for your taxation compliance and the National
Bureau of Investigation [with] which we have a good network...
While it [is your] prerogative to file a legal action against us, it is
also our prerogative to file a case against you. We will rather
suggest if you could request your lawyer to just confer with us for
the peaceful settlement of this matter. (Underscoring and
emphasis supplied)
As despite written demands,
13
respondent refused to turn over theproceeds of the insurance claim and to acknowledge the
unreasonableness of the attorneys fees he was demanding,
complainant instituted the administrative action at bar on
December 17, 1999.
In his Complaint-Affidavit, complainant alleged that "[i]t appears
that there was irregularity with the check," it having been
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issued payable to him, but "and/or AMADEO BALON" was therein
intercalated after his (complainants) name.141awphi1.nt
Maintaining that respondent was entitled to only P50,000.00 in
attorneys fees,
15
complainant decried respondents continuedpossession of the proceeds of his claim16and his
misrepresentations that the recoverythereof was fraught with
difficulties.17
In his Counter-Affidavit18of February 18, 2000, respondent
asserted that his continued retention of the proceeds of
complainants claim is in lawful exercise of his lien for unpaid
attorneys fees. He expressed readiness,however, to account for
and turn them over once he got paid fifty percent (50%) thereof,
he citing the so called contingent fee billing method of "no cure,no pay" adopted by practicing lawyers in the insurance industry as
the basis of the amount of his attorneys fees,19which to him was
justified in the absence of an attorney-client contract between him
and complainant, the latter having rejected respondents letter-
proposal of October 21, 1998.20
Respondent also highlighted the value of the time and efforts he
extended in pursuing complainants claim and theexpenses he
incurred in connection therewith. He went on to assert that hisinability to contact complainant whose whereabouts he did not
know prompted him to encash the check and keep the proceeds
thereof in conformity with the Special Power of Attorney executed
in his favor.21
During the hearings conducted by the IBP Investigator,
complainant echoed his allegations in his Complaint-Affidavit and
stressed that he turned down as unreasonable respondents
proposal in his October 21, 1998 letter that he be paid 25% of the
actual amount collected for his legal services.22And he presented
documentary evidence, including the March 26, 1999 letter of
respondent informing his co-attorney-in-fact Garcia of thesupposedly still unrecovered claim and suggesting acceptance of
the purported offer of Metropolitan Insurance to settle
complainants claim at P350,000.00.
Explaining how his above-mentioned March 26, 1999 letter to
Garcia came about, respondent declared that it was made upon
Garcias request, intended for a certain Joel Ramiscal (Ramiscal)
who was said to be Garcias business partner.23
Respondent later submitted a June 13, 2001 Supplement24to hisCounter-Affidavit reiterating his explanation that it was on Garcias
express request that he wrote the March 26, 1999 letter, which
was directed to the fax number of Ramiscal.1vvphi1.nt
Additionally, respondent declared that in the first week of May
1999, on the representation of Garcia that he had talked to
complainant about respondents retention of fifty percent (50%)
of the insurance proceeds for professional fees less expenses,25he
gave Garcia, on a staggered basis, the total amount ofP233,000.00 which, so respondent averred, is the amount of
insurance claim complainant is entitled to receive less attorneys
fees and expenses.26Thus, respondent claimed that he gave
Garcia the amount of P30,000.00 on May 31, 1999 at Dulcinea
Restaurant in Greenbelt, Makati; the amounts of P50,000.00,
P20,000.00 and P30,000.00 on different occasions at his
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(respondents) former address through his executive secretary
Sally I. Leonardo; the amount of P20,000.00 at the office of his
(respondents) former employer Commonwealth
Insurance Company through his subordinate Glen V. Roxas; and
several other payments at Dulcinea, and at ManilaIntercontinental Hotels coffee shop sometime inOctober
1999.27Respondent submitted the separate sworn statements of
Leonardo and Roxas.28
Explaining why no written memorandum of the turn over of
various payments to Garcia was made, respondent alleged that
there was no need therefor since he very well knew Garcia who is
a co-Rotarian and co-attorney-in-fact and whom he really dealt
with regarding complainants claim.29
Respondent furthermore declared that he rejected complainants
offer to pay him P50,000.00 for his services, insisting that since
there had been no clear-cut agreement on his professional fees
and it was through him that Metropolitan Insurance favorably
reconsidered its initial rejection of complainants claim, he is
entitled to a contingent fee of 50% of the net proceeds thereof.30
Finally, respondent declared that he, in connection with his follow-
up of the insurance claim, incurred representation expenses ofP35,000.00, entertainment and other representation expenses on
various occasions of P10,000.00, and transportation and gasoline
expenses and parking fees of P5,000.00;31and that his retention
of complainants money was justified in light of his apprehension
that complainant, being an alien without a valid working permit in
the Philippines, might leave the country anytime without settling
his professional fees.32
The Investigating Commissioner, by Report and
Recommendation33of October 26, 2001, found respondent guilty
of misconduct and recommended that he be disbarred and
directed to immediately turn over to complainant the sum of
P475,000.00 representing the amount of the P525,000.00
insurance claim less respondents professional fees of P50,000.00,
as proposed by complainant.
The Board of Govenors of the Integrated Bar of the Philippines,
acting on the Investigators Report, issued Resolution No. XV-
2002-40134on August 3,2002, reading:
RESOLVED to ADOPT and APPROVE, as it is hereby ADOPTED and
APPROVED, the Report and Recommendation of the Investigating
Commissioner of the above-entitled case, herein made part of this
Resolution/Decision as Annex "A"; and, finding the
recommendation fully supported by the evidence on record and
the applicable laws and rules, with modification, and considering
respondents dishonesty which amounted to grave misconduct and
grossly unethical behavior which caused dishonor, not merely to
respondent but the noble profession to which he belongs,Respondent is hereby SUSPENDED from the practice of law for six
(6) months with the directive to turn over the amount of Five
Hundred Twenty Five Thousand (P525,000.00) Pesos to the
complainant without prejudice to respondents right to claim
attorneys fees which he may collect in the proper forum .
(Underscoring supplied)
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The records of the case are before this Court for final action.
Respondent, by a Motion for Reconsideration35filed with this
Court, assails the Investigating Commissioners Report and
Recommendation as not supported by clear, convincing and
satisfactory proof. He prays for the reopening of the case and its
remand to the Investigator so that Garcia can personally appear
for his (respondents) confrontation.
There is no need for a reopening of the case. The facts material to
its resolution are either admitted or documented.
This Court is in full accord with the findings of the IBP
Investigator that respondent violated the following provisions of
the Code of Professional Responsibility, to wit:
RULE 1.01 - A lawyer shall not engage in unlawful, dishonest,
immoral or deceitful conduct.
xxx
CANON 15 - A lawyer shall observe candor, fairness and loyalty in
all his dealings and transactions with his clients.
RULE 15.06 - A lawyer shall not state or imply that he is able to
influence any public official, tribunal or legislative body.
xxx
CANON 16 - A lawyer shall hold in trust all moneys and properties
of his client that may come into his possession.
RULE 16.01 - A lawyer shall account for all money or property
collected or received for or from the client.
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.
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.
xxx
CANON 17 - A lawyer owes fidelity to the cause of his client and
he shall be mindful of the trust and confidence in him.
xxx
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
clients request for information.
xxx
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 advantage or that of a third person, unless
the client with full knowledge of the circumstances consents
thereto.
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Specifically with respect to above-quoted provision of Canon 16 of
the Code of Professional Responsibility, the Filipino lawyers
principal source of ethical rules, which Canon 16 bears on the
principal complaint of complainant, a lawyer must hold in trust all
moneys and properties of his client that he may come to possess.This commandment entails certain specific acts to be done by a
lawyer such as rendering an accounting of all money or property
received for or from the client36as well as delivery of the funds or
property to the client when due or upon demand.37Respondent
breached this Canon when after he received the proceeds of
complainants insurance claim, he did not report it to complainant,
who had a given address in Makati, or to his co-attorney-in-fact
Garcia who was his contact with respect to complainant.
In fact, long after respondent received the December 23,
1998 check for P525,000.00 he, by his letter of March 26, 1999 to
Garcia, had even the temerity to state that the claim was still
pending and recommend "acceptance of the 50% offer . . . which
is P350,000.00 pesos." His explanation that he prepared and sent
this letter on Garcias express request is nauseating. A lawyer, like
respondent, would not and should not commit prevarication,
documented at that, on the mere request of a friend.
By respondents failure to promptly account for the funds hereceived and held for the benefit of his client, he committed
professional misconduct.38Such misconduct is reprehensible at a
greater degree, for it was obviously done on purpose through the
employment of deceit to the prejudice of complainant who was
kept in the dark about the release of the check, until he himself
discovered the same, and has to date been deprived of the use of
the proceeds thereof.
A lawyer who practices or utilizes deceit in his dealings with his
client not only violates his duty of fidelity, loyalty and devotion to
the clients cause but also degrades himself and besmirches the
fair name of an honorable profession.39
That respondent had a lien on complainants funds for his
attorneys fees did not relieve him of his duty to account for
it.40The lawyers continuing exercise of his retaining lien
presupposes that the client agrees with the amount of attorneys
fees to be charged. In case of disagreement or when the client
contests that amount for being unconscionable, however, the
lawyer must not arbitrarily apply the funds in his possession to thepayment of his fees.41He can file, if he still deems it desirable, the
necessary action or proper motion with the proper court to fix the
amount of such fees.42
In respondents case, he never had the slightest attempt to bring
the matter of his compensation for judicial determination so that
his and complainants sharp disagreement thereon could have
been put to an end. Instead, respondent stubbornly and in bad
faith held on to complainants funds with the obvious aim offorcing complainant to agree to the amount of attor neys fees
sought. This is an appalling abuse by respondent of the exercise
of an attorneys retaining lien which by no means is an absolute
right and cannot at all justify inordinate delay in the delivery of
money and property to his client when due or upon demand.
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18LEGAL ETHICS ASSIGNED CASE READINGS
Respondent was, before receiving the check, proposing a 25%
attorneys fees.After he received the check and after complainant
had discovered its release to him, he was already asking for 50%,
objection to which complainant communicated to him. Why
respondent had to doubly increase his fees after the lapse ofabout one year when all the while he has been in custody of the
proceeds of the check defies comprehension. At any rate, it
smacks of opportunism, to say the least.
As for respondents claim in his June 2001 Supplement to his
Counter-Affidavit that he had on several occasions from May
1999 to October 1999 already delivered a total of P233,000.00 out
of the insurance proceeds to Garcia in trust for complainant, this
does not persuade, for it is bereft of any written memorandum
thereof. It is difficult to believe that a lawyer like respondent could
have entrusted such total amount of money to Garcia without
documenting it, especially at a time when, as respondent alleged,
he and Garcia were not in good terms.43Not only that. As stated
earlier, respondents Counter-Affidavit of February 18, 2000 and
his December 7, 1999 letter to complainant unequivocally
contained his express admission that the total amount of
P525,000.00 was in his custody. Such illogical, futile attempt to
exculpate himself only aggravates his misconduct. Respondents
claim discredited, the affidavits of Leonardo and Roxas who,
acting allegedly for him, purportedly gave Garcia some amounts
forming part of the P233,000.00 are thus highly suspect and merit
no consideration.
The proven ancillary charges against respondent reinforce the
gravity of his professional misconduct.
The intercalation of respondents name to the Chinabank check
that was issued payable solely in favor ofcomplainant as twice
certified by Metropolitan Insurance44is clearly a brazen act of
falsification of a commercial document which respondent resorted
to in order to encash the check.
Respondents threat in his December 7, 1999 letter to expose
complainant to possible sanctions from certain government
agencies with which he bragged to have a "good network" reflects
lack of character, self-respect, and justness.
It bears noting that for close to five long years respondent has
been in possession of complainants funds in the amount of over
half a million pesos. The deceptions and lies that he peddled to
conceal, until its discovery by complainant after about a year, hisreceipt of the funds and his tenacious custody thereof in a grossly
oppressive manner point to his lack of good moral character.
Worse, by respondents turnaround in his Supplement to his
Counter-Affidavit that he already delivered to complainants friend
Garcia the amount of P233,000.00 which, so respondent claims, is
all that complainant is entitled to, he in effect has declared that he
has nothing more to turn over to complainant. Such incredible
position is tantamount to a refusal to remit complainants funds,
and gives rise to the conclusion that he has misappropriatedthem.45
In fine, by respondents questioned acts, he has shown that he is
no longer fit to remain a member of the noble profession that is
the law.
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WHEREFORE, respondent Atty. Amadeo E. Balon, Jr., is foundGUILTY of malpractice, deceit and gross misconduct in the
practice of his profession as a lawyer and he is hereby
DISBARRED. The Office of the Clerk of Court is directed to strike
out his name from the Roll of Attorneys and to inform all courtsand the Integrated Bar of the Philippines of this Decision.
Respondent is ordered to turn over to complainant, Daniel
Lemoine, the amount of P525,000.00 within thirty (30) days from
notice, without prejudice to whatever judicial action he may take
to recover his attorneys fees and purported expenses incurred in
securing the release thereof from Metropolitan Insurance.
SO ORDERED.
Davide, Jr., C.J., Bellosillo, Puno, Vitug, Panganiban, Quisumbing,
Sandoval-Gutierrez, Carpio, Austria-Martinez, Corona, Carpio-
Morales, Callejo, Sr., Azcuna, and Tinga, JJ., concur.
Ynares-Santiago, J., on leave.
Republic of the Philippines
SUPREME COURTManila
EN BANC
A.C. No. 8380 November 20, 2009
ARELLANO UNIVERSITY, INC.Complainant,vs.
ATTY. LEOVIGILDO H. MI