A.C. No. 9872 January 28, 2014

NATIVIDAD P. NAVARRO and HILDA S. PRESBITERO, Complainants,

vs.

ATTY. IVAN M. SOLIDUM, JR., Respondent.

D E C I S I O N

PER CURIAM:

This case originated from a complaint for disbarment, dated 26 May 2008, filed by Natividad P. Navarro (Navarro) and Hilda S. Presbitero (Presbitero) against Atty. Ivan M. Solidum, Jr. (respondent) before the Integrated Bar of the Philippines Commission on Bar Discipline (IBP-CBD).

From the Report, dated 1July 2009, of the IBP-CBD, we gathered the following facts of the case:

On 4 April 2006, respondent signed a retainer agreement with Presbitero to follow up the release of the payment for the latter’s 2.7-hectare property located in Bacolod which was the subject of a Voluntary Offer to Sell (VOS) to the Department of Agrarian Reform (DAR). The agreement also included the payment of the debts of Presbitero’s late husband to the Philippine National Bank (PNB), the sale of the retained areas of the property, and the collection of the rentals due for the retained areas from their occupants. It appeared that the DAR was supposed to pay P700,000 for the property but it was mortgaged by Presbitero and her late husband to PNB for P1,200,000. Presbitero alleged that PNB’s claim had already prescribed, and she engaged the services of respondent to represent her in the matter. Respondent proposed the filing of a case for quieting of title against PNB. Respondent and Presbitero agreed to an attorney’s fee of 10% of the proceeds from the VOS or the sale of the property, with the expenses to be advanced by Presbitero but deductible from respondent’s fees. Respondent received P50,000 from Presbitero, supposedly for the expenses of the case, but nothing came out of it.

In May 2006, Presbitero’s daughter, Ma. Theresa P. Yulo (Yulo), also engaged respondent’s services to handle the registration of her 18.85-hectare lot located in Nasud-ong, Caradio-an, Himamaylan, Negros. Yulo convinced her sister, Navarro, to finance the expenses for the registration of the property. Respondent undertook to register the property in consideration of 30% of the value of the property once it is registered. Respondent obtained P200,000 from Navarro for the registration expenses. Navarro later learned that the registration decree over the property was already issued in the name of

one Teodoro Yulo. Navarro alleged that she would not have spent for the registration of the property if respondent only apprised her of the real situation of the property.

On 25 May 2006, respondent obtained a loan of P1,000,000 from Navarro to finance his sugar trading business. Respondent and Navarro executed a Memorandum of Agreement (MOA) and agreed that the loan (a) shall be for a period of one year; (b) shall earn interest at the rate of 10% per month; and (c) shall be secured by a real estate mortgage over a property located in Barangay Alijis, Bacolod City, covered by Transfer Certificate of Title No. 304688. They also agreed that respondent shall issue postdated checks to cover the principal amount of the loan as well as the interest thereon. Respondent delivered the checks to Navarro, drawn against an account in Metrobank, Bacolod City Branch, and signed them in the presence of Navarro.

In June 2006, respondent obtained an additional loan of P1,000,000 from Navarro, covered by a second MOA with the same terms and conditions as the first MOA. Respondent sent Navarro, through a messenger, postdated checks drawn against an account in Bank of Commerce, Bacolod City Branch. Respondent likewise discussed with Navarro about securing a "Tolling Agreement" with Victorias Milling Company, Inc. but no agreement was signed.

At the same time, respondent obtained a loan of P1,000,000 from Presbitero covered by a third MOA, except that the real estate mortgage was over a 263-square-meter property located in Barangay Taculing, Bacolod City. Respondent sent Presbitero postdated checks drawn against an account in Metrobank, Bacolod City Branch.

Presbitero was dissatisfied with the value of the 263-square-meter property mortgaged under the third MOA, and respondent promised to execute a real estate mortgage over a 1,000-square-meter parcel of land adjacent to the 4,000-square-meter property he mortgaged to Navarro.

However, respondent did not execute a deed for the additional security.

Respondent paid the loan interest for the first few months. He was able to pay complainants a total of P900,000. Thereafter, he failed to pay either the principal amount or the interest thereon. In September 2006, the checks issued by respondent to complainants could no longer be negotiated because the accounts against which they were drawn were already closed. When complainants called respondent’s attention, he promised to pay the agreed interest for September and October 2006 but asked for a reduction of the interest to 7% for the succeeding months.

In November 2006, respondent withdrew as counsel for Yulo. On the other hand, Presbitero terminated the services of respondent as counsel. Complainants then filed petitions for the judicial foreclosure of the mortgages executed by respondent in their favor. Respondent countered that the 10% monthly interest on the loan was usurious and illegal. Complainants also filed cases for estafa and violation of Batas Pambansa Blg. 22 against respondent.

Complainants alleged that respondent induced them to grant him loans by offering very high interest rates. He also prepared and signed the checks which turned out to be drawn against his son’s accounts. Complainants further alleged that respondent deceived them regarding the identity and value of the property he mortgaged because he showed them a different property from that which he owned. Presbitero further alleged that respondent mortgaged his 263-square-meter property to her for P1,000,000 but he later sold it for only P150,000.

Respondent, for his defense, alleged that he was engaged in sugar and realty business and that it was Yulo who convinced Presbitero and Navarro to extend him loans. Yulo also assured him that Presbitero would help him with the refining of raw sugar through Victorias Milling Company, Inc. Respondent alleged that Navarro fixed the interest rate and he agreed because he needed the money. He alleged that their business transactions were secured by real estate mortgages and covered by postdated checks. Respondent denied that the property he mortgaged to Presbitero was less than the value of the loan. He also denied that he sold the property because the sale was actually rescinded. Respondent claimed that the property he mortgaged to Navarro was valuable and it was actually worth more than P8,000,000.

Respondent alleged that he was able to pay complainants when business was good but he was unable to continue paying when the price of sugar went down and when the business with Victorias Milling Company, Inc. did not push through because Presbitero did not help him. Respondent also denied that he was hiding from complainants.

Respondent further alleged that it was Yulo who owed him P530,000 as interest due for September to December 2005. He denied making any false representations. He claimed that complainants were aware that he could no longer open a current account and they were the ones who proposed that his wife and son issue the checks. Respondent further alleged that he already started with the titling of Yulo’s lot but his services were terminated before it could be completed.

A supplemental complaint was filed charging respondent with accepting cases while under suspension. In response, respondent alleged that he accepted Presbitero’s case in February 2006 and learned of his suspension only in May 2006.

After conducting a hearing and considering the position papers submitted by the parties, the IBP-CBD found that respondent violated the Code of Professional Responsibility.

The IBP-CBD found that respondent borrowed P2,000,000 from Navarro and P1,000,000 from Presbitero which he failed to pay in accordance with the MOAs he executed. The IBP-CBD found that based on the documents presented by the parties, respondent did not act in good faith in obtaining the loans. The IBP-CBD found that respondent either promised or agreed to pay the very high interest rates of the loans although he knew them to be exorbitant in accordance with jurisprudence. Respondent likewise failed to deny that he misled Navarro and her husband regarding the identity of the property mortgaged to them. Respondent also mortgaged a property to Presbitero for P1,000,000 but documents showed that its value was only P300,000. Documents also showed that he sold that property for only P150,000. Respondent conspired with Yulo to secure loans by promising her a 10% commission and later claimed that they agreed that Yulo would "ride" on the loan by borrowing P300,000 from the amount he obtained from Navarro and Presbitero. Respondent could not explain how he lost all the money he borrowed in three months except for his claim that the price of sugar went down.

The IBP-CBD found that respondent misled Navarro and Presbitero regarding the issuance of the postdated checks, and there was nothing in the records that would show that he informed them that it would be his wife or son who would issue the checks. The IBP-CBD also found that respondent had not been transparent in liquidating the money he received in connection with Presbitero’s VOS with DAR. He was also negligent in his accounting regarding the registration of Yulo’s property which was financed by Navarro.

The IBP-CBD found that respondent was guilty of violating Rule 1.01 of the Code of Professional Responsibility for committing the following acts:

(1) signing drawn checks against the account of his son as if they were from his own account;

(2) misrepresenting to Navarro the identity of the lot he mortgaged to her;

(3) misrepresenting to Presbitero the true value of the 263-square-meter lot he mortgaged to her;

(4) conspiring with Yulo to obtain the loans from complainants;

(5) agreeing or promising to pay 10% interest on his loans although he knew that it was exorbitant; and

(6) failing to pay his loans because the checks he issued were dishonored as the accounts were already closed.

The IBP-CBD also found that respondent violated Canon 16 and Rule 16.01 of the Code of Professional Responsibility when he failed to properly account for the various funds he received from complainants.

In addition, the IBP-CBD found that respondent violated Rule 16.04 of the Code of Professional Responsibility which prohibits borrowing money from a client unless the client’s interest is fully protected or the client is given independent advice.

On the matter of practicing law while under suspension, the IBP-CBD found that the records were not clear whether the notice of suspension respondent received on 29 May 2006 was the report and recommendation of the IBP-CBD or the final decision of this Court. The IBP-CBD likewise found that there was insufficient evidence to prove that respondent mishandled his cases.

The IBP-CBD recommended that respondent be meted the penalty of disbarment.

In Resolution No. XIX-2011-267 dated 14 May 2011, the IBP Board of Governors adopted and approved the recommendation of the IBP-CBD with modification by reducing the recommended penalty from disbarment to suspension from the practice of law for two years. The IBP Board of Governors likewise ordered respondent to return the amount of his unpaid obligation to complainants.

Complainants filed a motion for reconsideration, praying that the penalty of disbarment be instead imposed upon respondent.

The only issue in this case is whether respondent violated the Code of Professional Responsibility.

The records show that respondent violated at least four provisions of the Code of Professional Responsibility.

Rule 1.01 of the Code of Professional Responsibility provides:

Rule 1.01. - A lawyer shall not engage in unlawful, dishonest, immoral or deceitful conduct.

With respect to his client, Presbitero, it was established that respondent agreed to pay a high interest rate on the loan he obtained from her. He drafted the MOA. Yet, when he could no longer pay his loan, he sought to nullify the same MOA he drafted on the ground that the interest rate was unconscionable. It was also established that respondent mortgaged a 263-square-meter property to Presbitero for P1,000,000 but he later sold the property for only P150,000, showing that he deceived his client as to the real value of the mortgaged property. Respondent’s allegation that the sale was eventually rescinded did not distract from the fact that he did not apprise Presbitero as to the real value of the property.

Respondent failed to refute that the checks he issued to his client Presbitero and to Navarro belonged to his son, Ivan Garcia Solidum III whose name is similar to his name. He only claimed that complainants knew that he could no longer open a current bank account, and that they even suggested that his wife or son issue the checks for him. However, we are inclined to agree with the IBP-CBD’s finding that he made complainants believe that the account belonged to him. In fact, respondent signed in the presence of Navarro the first batch of checks he issued to Navarro. Respondent sent the second batch of checks to Navarro and the third batch of checks to Presbitero through a messenger, and complainants believed that the checks belonged to accounts in respondent’s name.

It is clear that respondent violated Rule 1.01 of the Code of Professional Responsibility. We have ruled that conduct, as used in the Rule, is not confined to the performance of a lawyer’s professional duties.1 A lawyer may be disciplined for misconduct committed either in his professional or private capacity.2 The test is whether his conduct shows him to be wanting in moral character, honesty, probity, and good demeanor, or whether it renders him unworthy to continue as an officer of the court.3

In this case, the loan agreements with Navarro were done in respondent’s private capacity. Although Navarro financed the registration of Yulo’s lot, respondent and Navarro had no lawyer-client relationship. However, respondent was Presbitero’s counsel at the time she granted him a loan. It was established that respondent misled Presbitero on the value of the property he mortgaged as a collateral for his loan from her. To appease Presbitero, respondent even made a Deed of Undertaking that he would give her another 1,000-square-meter lot as additional collateral but he failed to do so.

Clearly, respondent is guilty of engaging in dishonest and deceitful conduct, both in his professional capacity with respect to his client, Presbitero, and in his private capacity with respect to complainant Navarro. Both Presbitero and Navarro allowed respondent to draft the terms of the loan agreements. Respondent drafted the MOAs knowing that the interest rates were exorbitant. Later, using his knowledge of the law, he assailed the validity of the same MOAs he prepared. He issued checks that were drawn from his son’s account whose name was similar to his without informing complainants.

Further, there is nothing in the records that will show that respondent paid or undertook to pay the loans he obtained from complainants.

Canon 16 and Rule 16.01 of the Code of Professional Responsibility provide:

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.

The fiduciary nature of the relationship between the counsel and his client imposes on the lawyer the duty to account for the money or property collected or received for or from his client.4 We agree with the IBP-CBD that respondent failed to fulfill this duty. In this case, the IBP-CBD pointed out that respondent received various amounts from complainants but he could not account for all of them.

Navarro, who financed the registration of Yulo’s 18.85-hectare lot, claimed that respondent received P265,000 from her. Respondent countered that P105,000 was paid for real estate taxes but he could not present any receipt to prove his claim. Respondent also claimed that he paid P70,000 to the surveyor but the receipt was only for P15,000. Respondent claimed that he paid P50,000 for filing fee, publication fee, and other expenses but again, he could not substantiate his claims with any receipt. As pointed out by the IBP-CBD, respondent had been less than diligent in accounting for the funds he received from Navarro for the registration of Yulo’s property.

Unfortunately, the records are not clear whether respondent rendered an accounting to Yulo who had since passed away.

As regards Presbitero, it was established during the clarificatory hearing that respondent received P50,000 from Presbitero. As the IBP-CBD pointed out, the records do not show how respondent spent the funds because he was not transparent in liquidating the money he received from Presbitero.

Clearly, respondent had been negligent in properly accounting for the money he received from his client, Presbitero.1âwphi1 Indeed, his failure to return the excess money in his possession 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.5

Rule 16.04 of the Code of Professional Responsibility provides:

Rule 16.04. - A 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.

Here, respondent does not deny that he borrowed P1,000,000 from his client Presbitero. At the time he secured the loan, respondent was already the retained counsel of Presbitero.

While respondent’s loan from Presbitero was secured by a MOA, postdated checks and real estate mortgage, it turned out that respondent misrepresented the value of the property he mortgaged and that the checks he issued were not drawn from his account but from that of his son. Respondent eventually questioned the terms of the MOA that he himself prepared on the ground that the interest rate imposed on his loan was unconscionable. Finally, the checks issued by respondent to Presbitero were dishonored because the accounts were already closed. The interest of his client, Presbitero, as lender in this case, was not fully protected. Respondent violated Rule 16.04 of the Code of Professional Responsibility, which presumes that the client is disadvantaged by the lawyer’s ability to use all the legal maneuverings to renege on his obligation.6 In his dealings with his client Presbitero, respondent took advantage of his knowledge of the law as well as the trust and confidence reposed in him by his client.

We modify the recommendation of the IBP Board of Governors imposing on respondent the penalty of suspension from the practice of law for two years. Given the facts of the case, we see no reason to deviate from the recommendation of the IBP-CBD imposing on respondent the penalty of disbarment. Respondent failed to live up to the high standard of morality, honesty, integrity, and fair dealing required of him as a member of the legal profession.7 Instead, respondent employed his knowledge and skill of the law and took advantage of his client to secure undue gains for himself8 that warrants his removal from the practice of law. Likewise, we cannot sustain the IBP Board of Governors’ recommendation ordering respondent to return his unpaid obligation to complainants, except for advances for the expenses he received from his client, Presbitero, that were not accounted at all. In disciplinary proceedings against lawyers, the only issue is whether the officer of the court is still fit to be allowed to continue as a member of the Bar.9 Our only concern is the determination of respondent’s administrative liability.10

Our findings have no material bearing on other judicial action which the parties may choose to file against each other.11 Nevertheless, when a lawyer receives money from a client for a particular purpose involving the client-attorney relationship, he is bound to render an accounting to the client showing that the money was spent for that particular purpose.12 If the lawyer does not use the money for the intended purpose, he must immediately return the money to his client.13 Respondent was given an

opportunity to render an accounting, and he failed. He must return the full amount of the advances given him by Presbitero, amounting to P50,000.

WHEREFORE, the Court finds Atty. Ivan M. Solidum, Jr. GUILTY of violating Rule 1.01, Canon 16, Rule 16.01, and Rule 16.04 of the Code of Professional Responsibility. Accordingly, the Court DISBARS him from the practice of law effective immediately upon his receipt of this Decision.

Atty. Solidum is ORDERED to return the advances he received from Hilda S. Presbitero, amounting to P50,000, and to submit to the Office of the Bar Confidant his compliance with this order within thirty days from finality of this Decision.

Let copies of this Decision be furnished the Office of the Bar Confidant, the Integrated Bar of the Philippines for distribution to all its chapters, and the Office of the Court Administrator for dissemination to all courts all over the country. Let a copy of this Decision be attached to the personal records of respondent.

SO ORDERED.

A.C. No. 8761 February 12, 2014

WILBERTO C. TALISIC, Complainant,

vs.

ATTY. PRIMO R. RINEN, Respondent.

R E S O L U T I O N

REYES, J.:

This is an administrative case instituted by complainant Wilberto C. Talisic (Wilberto) against Atty. Primo R. Rinen1 (Atty. Rinen), charging the latter with falsification of an Extra Judicial Partition with Sale2 which allowed the transfer to spouses Benjamin Durante and Eleonor Lavifia (Spouses Durante) of a parcel of land formerly owned by Wilberto's mother, Aurora Corpuz (Aurora). The property, measuring 3,817 square meters and situated in Barangay Langgas, Infanta, Quezon, was formerly covered by Original Certificate of Title No. P-4875 under Aurora's name.3 After Atty. Rinen filed his comment on the

complaint, the Court referred the case to the Integrated Bar of the Philippines (IBP), Commission on Bar Discipline, for investigation, report and recommendation.4

Wilberto claimed that his mother Aurora died on May 7, 1987, leaving behind as heirs her spouse, Celedonio Talisic, and their three children, namely: Arlene Talisic Villarazo, Wilberto and Alvin Corpuz Talisic. It was only after his father’s death on November 2, 2000 that Wilberto and his siblings knew of the transfer of the subject parcel via the subject deed. While Wilberto believed that his father’s signature on the deed was authentic, his and his siblings’ supposed signatures were merely forged. Wilberto also pointed out that even his name was erroneously indicated in the deed as "Wilfredo".5

For his defense, Atty. Rinen denied the charge against him and explained that it was only on April 7, 1994 that he came to know of the transaction between the Spouses Durante and the Talisics, when they approached him in his office as the then Presiding Judge of the Municipal

Trial Court, Real, Quezon, to have the subject deed prepared and notarized. His clerk of court prepared the deed and upon its completion, ushered the parties to his office for the administration of oath.6 The deed contained his certification that at the time of the document’s execution, "no notary public was available to expedite the transaction of the parties." Notarial fees paid by the parties were also covered by a receipt issued by the Treasurer of the Municipality of Real, Quezon.7

After due proceedings, Investigating Commissioner Felimon C. Abelita III (Commissioner Abelita) issued the Report and Recommendation8 dated November 20, 2012 for the cancellation of Atty. Rinen’s notarial commission and his suspension from notarial practice for a period of one year.9 The report indicated that per Atty. Rinen’s admission, the subject deed was prepared in his office and acknowledged before him. Although there was no evidence of forgery on his part, he was negligent in not requiring from the parties to the deed their presentation of documents as proof of identity. Atty. Rinen’s failure to properly satisfy his duties as a notary public was also shown by the inconsistencies in the dates that appear on the deed, to wit: "1994 as to the execution; 1995 when notarized; [and] entered as Series of 1992 in the notarial book x x x."10

In the meantime, Atty. Rinen filed a motion for reconsideration11 of Commissioner Abelita’s recommendation. The IBP Board of Governors, nonetheless, adopted and approved on March 20, 2013, via Resolution No. XX-2013-247, the Investigating Commissioner’s Report and Recommendation.12

The Court agrees with the findings and recommendations of the IBP.

"[F]aithful observance and utmost respect of the legal solemnity of the oath in an acknowledgment or jurat is sacrosanct."13 "The notarization of a document carries considerable legal effect. Notarization of a private document converts such document into a public one, and renders it admissible in court without further proof of its authenticity.1âwphi1 Thus, notarization is not an empty routine; to the contrary, it engages public interest in a substantial degree x x x."14

It must then be stressed that, "a notary public’s function should not be trivialized and a notary public must discharge his powers and duties which are impressed with public interest, with accuracy and fidelity."15 Towards this end, the Court emphasized in Bautista v. Atty. Bernabe16 that "[a] notary public should not notarize a document unless the persons who signed the same are the very same persons who executed and personally appeared before him to attest to the contents and truth of what are stated therein. The presence of the parties to the deed will enable the notary public to verify the genuineness of the signature of the affiant."17

In the present case, Atty. Rinen did not deny his failure to personally verify the identity of all parties who purportedly signed the subject document and whom, as he claimed, appeared before him on April 7, 1994. Such failure was further shown by the fact that the pertinent details of the community tax certificates of Wilberto and his sister, as proof of their identity, remained unspecified in the subject deed’s acknowledgment portion. Clearly, there was a failure on the part of Atty. Rinen to exercise the due diligence that was required of him as a notary public ex-officio. The lapses he committed in relation to such function then justified the recommendations presented by the IBP.

The fact that Atty. Rinen was a trial court judge during the time that he administered the oath for the subject deed did not relieve him of compliance with the same standards and obligations imposed upon other commissioned notaries public. He also could not have simply relied on his clerk of court to perform the responsibilities attached to his function, especially as it pertained to ensuring that the parties to the document were then present, performing an act that was of their own free will and deed. "Notarization is not an empty, meaningless, routinary act. It is invested with substantive public interest, such that only those who are qualified or authorized may act as notaries public."18 It converts a private document into a public one, making it admissible in court without further proof of its authenticity. Thus, "notaries public must observe with utmost care the basic requirements in the performance of their duties."19 Otherwise, the confidence of the public in the integrity of public instruments would be undermined.20

WHEREFORE, as recommended by the Integrated Bar of the Philippines, the Court REVOKES the notarial commission which Atty. Primo R. Rinen may presently have, and DISQUALIFIES him from being commissioned as a notary public for one year, effective immediately. He is WARNED that a repetition of the same or similar act in the future shall merit a more severe sanction. He is DIRECTED to report to this Court the date of his receipt of this Resolution to enable it to determine when the revocation of his notarial commission and his disqualification from being commissioned as notary public shall take effect.

Let copies of this Resolution be furnished the Office of the Bar Confidant to be appended to Atty. Primo R. Rinen's personal record. Likewise, copies shall be furnished to the Integrated Bar of the Philippines and all courts in the country for their information and guidance.

SO ORDERED.

BIENVENIDO L. REYES

Associate Justice

A.C. No. 10135 January 15, 2014

EDGARDO AREOLA, Complainant,

vs.

ATTY. MARIA VILMA MENDOZA, Respondent.

R E S O L U T I O N

REYES, J.:

This refers to the administrative complaint1 filed by Edgardo D. Areola (Areola) a.k.a. Muhammad Khadafy against Atty. Maria Vilma Mendoza (Atty. Mendoza), from the Public Attorney s Office (PAO) for violation of her attorney s oath of office, deceit, malpractice or other gross misconduct in office under Section 27, Rule 138 of the Revised Rules of Court, and for violation of the Code of Professional Responsibility.

In the letter-complaint dated November 13, 2006 addressed to the Honorable Commissioners, Commission on Bar Discipline of the Integrated Bar of the Philippines (IBP), Areola stated that he was filing the complaint in behalf of his co-detainees Allan Seronda, Aaron Arca, Joselito Mirador, Spouses Danilo Perez and Elizabeth Perez. He alleged that on October 23, 2006, during Prisoners Week, Atty. Mendoza, visited the Antipolo City Jail and called all detainees with pending cases before the Regional Trial Court (RTC), Branch 73, Antipolo City where she was assigned, to attend her speech/lecture.2 Areola claimed that Atty. Mendoza stated the following during her speech:

"O kayong may mga kasong drugs na may pangpiyansa o pang- areglo ay maging praktikal sana kayo kung gusto ninyong makalaya agad. Upang makatiyak kayo na hindi masasayang ang pera ninyo ay sa akin ninyo ibigay o ng kamag-anak ninyo ang pera at ako na ang bahalang maglagay kay Judge Martin at Fiscal banqui; at kayong mga detenidong mga babae na no bail ang kaso sa drugs, iyak-iyakan lang ninyo si Judge Martin at palalayain na kayo. Malambot ang puso noon."3

Atty. Mendoza allegedly said that as she is handling more than 100 cases, all detainees should prepare and furnish her with their Sinumpaang Salaysay so that she may know the facts of their cases and their defenses and also to give her the necessary payment for their transcript of stenographic notes.4

Areola furthermore stated that when he helped his co-inmates in drafting their pleadings and filing motions before the RTC Branch 73, Antipolo City, Atty. Mendoza undermined his capability, to wit:

(1) Atty. Mendoza purportedly scolded detainee Seronda when she learned that the latter was assisted by Areola in filing a Motion to Dismiss for Violation of Republic Act No. 8942 (Speedy Trial Act of 1998) in the latter’s criminal case for rape, which was pending before the RTC, Branch 73, Antipolo City. She got angrier when Seronda retorted that he allowed Areola to file the motion for him since there was nobody to help him.

(2) Areola assisted Spouses Danilo and Elizabeth Perez in filing their Joint Motion for Consolidation of Trial of Consolidated Offenses and Joint Motion to Plead Guilty to a Lesser Offense. The spouses were likewise scolded for relying on the Complainant and alleged that the respondent asked for P2,000.00 to represent them.

(3) Areola helped another co-detainee, Mirador in filing an "Ex-parte Motion to Plead Guilty to a Lesser Offense". When Atty. Mendoza learned of it, she allegedly scolded Mirador and discredited Areola.5

In her unverified Answer6 dated January 5, 2007, Atty. Mendoza asseverated that the filing of the administrative complaint against her is a harassment tactic by Areola as the latter had also filed several administrative cases against judges in the courts of Antipolo City including the jail warden of Taytay, Rizal where Areola was previously detained. These actuations show that Areola has a penchant for filing various charges against anybody who does not accede to his demand.7 Atty. Mendoza contended that Areola is not a lawyer but represented himself to his co-detainees as one.8 She alleged that the motions/pleadings prepared and/or filed by Areola were not proper.

After both parties failed to appear in the Mandatory Conference set by the IBP on August 15, 2008, the Investigating Commissioner considered the non-appearance as a waiver on their part. Nonetheless, in the interest of justice, both parties were required to submit their respective position papers.9

On December 29, 2009, the Investigating Commissioner issued his Report and Recommendation.10 The Investigating Commissioner stated that the Complainant is knowledgeable in the field of law. While he may be of service to his fellow detainees, he must, however, be subservient to the skills and knowledge of a full fledged lawyer. He however found no convincing evidence to prove that Atty. Mendoza received money from Areola’s co-detainees as alleged. The charges against Atty. Mendoza were also uncorroborated, viz:

There is no convincing evidence that will prove that the respondent received money from the inmates since the charges are uncorroborated. In fact, the complainant is not the proper party to file the instant case since he was not directly affected or injured by the act/s being complained of. No single affidavits of the affected persons were attached to prove the said charges. Hence, it is simply hearsay in nature.11

Nonetheless, Atty. Mendoza admitted in her Answer that she advised her clients and their relatives to approach the judge and the fiscal "to beg and cry" so that their motions would be granted and their cases against them would be dismissed. To the Investigating Commissioner, this is highly unethical and improper as the act of Atty. Mendoza degrades the image of and lessens the confidence of the public in the judiciary.12 The Investigating Commissioner recommended that Atty. Mendoza be suspended from the practice of law for a period of two (2) months.13

In a Notice of Resolution14 dated November 19, 2011, the Board of Governors resolved to adopt and approve the Report and Recommendation of the Investigating Commissioner.

Atty. Mendoza sought to reconsider the Resolution15 dated November 19, 2011 but the IBP Board of Governors denied her motion in its Resolution16 dated May 10, 2013. The Resolution of the IBP Board of Governors was transmitted to the Court for final action pursuant to Rule 139-B, Section 12, Paragraph b17 of the Revised Rules of Court.

The Court’s Ruling

After a judicious examination of the records, the Court finds that the instant Complaint against Atty. Mendoza profoundly lacks evidence to support the allegations contained therein. All Areola has are empty assertions against Atty. Mendoza that she demanded money from his co-detainees.

The Court agrees with the IBP that Areola is not the proper party to file the Complaint against Atty. Mendoza. He is not even a client of Atty. Mendoza. He claims that he filed the Complaint on behalf of his co-detainees Seronda, Arca, Mirador and Spouses Perez, but it is apparent that no document was submitted which would show that they authorized Areola to file a Complaint. They did not sign the Complaint he prepared. No affidavit was even executed by the said co-detainees to substantiate the matters Areola raised. Consequently, the Court rejects Areola’s statements, especially as regards Atty. Mendoza’s alleged demands of money.

The Court agrees with the observations of the Investigating Commissioner that Areola initiated this complaint when he felt insulted because Atty. Mendoza refused to acknowledge the pleadings and motions he prepared for his co-detainees who are PAO clients of Atty. Mendoza.18 It appears that Areola is quite knowledgeable with Philippine laws. However, no matter how good he thinks he is, he is still not a lawyer. He is not authorized to give legal advice and file pleadings by himself before the courts. His familiarity with Philippine laws should be put to good use by cooperating with the PAO instead of filing baseless complaints against lawyers and other government authorities. It seems to the Court that Areola thinks of himself as more intelligent and better than Atty. Mendoza, based on his criticisms against her. In his Reply19, he made fun of her grammatical errors and tagged her as using carabao english20. He also called the PAO as "Pa-Amin Office"21 which seriously undermines the reputation of the PAO. While Areola may have been frustrated with the way the PAO is managing the significant number of cases it deals with, all the more should he exert efforts to utilize his knowledge to work with the PAO instead of maligning it.

Interestingly, Atty. Mendoza admitted that she advised her clients to approach the judge and plead for compassion so that their motions would be granted. This admission corresponds to one of Areola’s charges against Atty. Mendoza—that she told her clients " Iyak-iyakan lang ninyo si Judge Martin at palalayain na kayo. Malambot ang puso noon." Atty. Mendoza made it appear that the judge is easily moved if a party resorts to dramatic antics such as begging and crying in order for their cases to be dismissed.

As such, the Court agrees with the IBP Board of Governors that Atty. Mendoza made irresponsible advices to her clients in violation of Rule 1.02 and Rule 15.07 of the Code of Professional Responsibility. It is the mandate of Rule 1.02 that "a lawyer shall not counsel or abet activities aimed at defiance of the law or at lessening confidence in the legal system." Rule 15.07 states that "a lawyer shall impress upon his client compliance with the laws and the principles of fairness."

Atty. Mendoza’s improper advice only lessens the confidence of the public in our legal system. Judges must be free to judge, without pressure or influence from external forces or factors22 according to the merits of a case. Atty. Mendoza’s careless remark is uncalled for.

It must be remembered that a lawyer’s duty is not to his client but to the administration of justice.1âwphi1 To that end, his client’s success is wholly subordinate. His conduct ought to and must always be scrupulously observant of the law and ethics. Any means, not honorable, fair and honest which is resorted to by the lawyer, even in the pursuit of his devotion to his client’s cause, is condemnable and unethical.23

In spite of the foregoing, the Court deems the penalty of suspension for two (2) months as excessive and not commensurate to Atty. Mendoza’s infraction. Disbarment and suspension of a lawyer, being the most severe forms of disciplinary sanction, should be imposed with great caution and only in those cases where the misconduct of the lawyer as an officer of the court and a member of the bar is established by clear, convincing and satisfactory proof.24 The Court notes that when Atty. Mendoza made the remark "Iyak-iyakan lang ninyo si Judge Martin at palalayain na kayo. Malambot ang puso noon", she was not compelled by bad faith or malice. While her remark was inappropriate and unbecoming, her comment is not disparaging and reproachful so as to cause dishonor and disgrace to the Judiciary.

In several administrative cases, the Court has refrained from imposing the actual penalties in the presence of mitigating factors. Factors such as the respondent’s length of service, the respondent’s acknowledgement of his or her infractions and feeling of remorse, family circumstances, humanitarian and equitable considerations, respondent’s advanced age, among other things, have had varying significance in the Court’s determination of the imposable penalty.25 The Court takes note of Atty. Mendoza’s lack of ill-motive in the present case and her being a PAO lawyer as her main source of livelihood.26 Furthermore, the complaint filed by Areola is clearly baseless and the only reason why this was ever given consideration was due to Atty. Mendoza’s own admission. For these reasons, the Court deems it just to modify and reduce the penalty recommended by the IBP Board of Governors.

WHEREFORE, premises considered, the Court finds Atty. Maria Vilma Mendoza GUILTY of giving improper advice to her clients in violation of Rule 1.02 and Rule 15.07 of the Code of Professional Responsibility and is accordingly meted out the penalty of REPRIMAND, with the STERN WARNING that a repetition of the same or similar act will be dealt with more severely.

SO ORDERED.

BIENVENIDO L. REYES

Associate Justice

WE CONCUR:

A.C. No. 4545 February 5, 2014

CARLITO ANG, Complainant,

vs.

ATTY. JAMES JOSEPH GUPANA, Respondent.

D E C I S I O N

VILLARAMA, JR., J.:

Before us is a petition for review under Rule 139-B, Section 12(c) of the Rules of Court assailing Resolution Nos. XVII-2005-1411 and XVIII-2008-6982 of the Board of Governors of the Integrated Bar of the Philippines (IBP). The IBP Board of Governors found respondent Atty. James Joseph Gupana administratively liable and imposed on him the penalty of suspension for one year from the practice of law and the revocation of his notarial commission and disqualification from reappointment as notary public for two years.

The case stemmed from an affidavit-complaint3 filed by complainant Carlito Ang against respondent. Ang alleged that on May 31, 1991, he and the other heirs of the late Candelaria Magpayo, namely Purificacion Diamante and William Magpayo, executed an Extra-judicial Declaration of Heirs and Partition4 involving Lot No. 2066-B-2-B which had an area of 6,258 square meters and was covered by Transfer Certificate of Title (TCT) No. (T-22409)-6433. He was given his share of 2,003 square meters designated as Lot No. 2066-B-2-B-4, together with all the improvements thereon.5 However, when he tried to secure a TCT in his name, he found out that said TCT No. (T-22409)-6433 had already been cancelled and in lieu thereof, new TCTs6 had been issued in the names of William Magpayo, Antonio Diamante, Patricia Diamante, Lolita D. Canque, Gregorio Diamante, Jr. and Fe D. Montero.

Ang alleged that there is reasonable ground to believe that respondent had a direct participation in the commission of forgeries and falsifications because he was the one who prepared and notarized the Affidavit of Loss7 and Deed of Absolute Sale8 that led to the transfer and issuance of the new TCTs. Ang pointed out that the Deed of Absolute Sale which was allegedly executed by Candelaria Magpayo on April 17, 1989, was antedated and Candelaria Magpayo’s signature was forged as clearly shown by the Certification9 issued by the Office of the Clerk of Court of the Regional Trial Court (RTC) of Cebu. Further, the certified true copy of page 37, Book No. XII, Series of 1989 of respondent’s Notarial Report indubitably showed that Doc. No. 181 did not refer to the Deed of Absolute Sale, but to an affidavit.10 As to the Affidavit of Loss, which was allegedly executed by the late Candelaria Magpayo on April 29,

1994, it could not have been executed by her as she Died11 three years prior to the execution of the said affidavit of loss.

Ang further alleged that on September 22, 1995, respondent made himself the attorney-in-fact of William Magpayo, Antonio Diamante, Patricia Diamante, Lolita Canque, Gregorio Diamante, Jr. and Fe D. Montero, and pursuant to the Special Power of Attorney in his favor, executed a Deed of Sale12 selling Lot No. 2066-B-2-B-4 to Lim Kim So Mercantile Co. on October 10, 1995. Ang complained that the sale was made even though a civil case involving the said parcel of land was pending before the RTC of Mandaue City, Cebu.13

In his Comment,14 respondent denied any wrongdoing and argued that Ang is merely using the present administrative complaint as a tool to force the defendants in a pending civil case and their counsel, herein respondent, to accede to his wishes. Respondent averred that Ang had filed Civil Case No. Man-2202 before Branch 55 of the Mandaue City RTC. He anchored his claim on the Extra-judicial Declaration of Heirs and Partition and sought to annul the deed of sale and prayed for reconveyance of the subject parcel of land. During the pre-trial conference in Civil Case No. Man-2202, Ang admitted that he is not an heir of the late Candelaria Magpayo but insisted on his claim for a share of the lot because he is allegedly the son of the late Isaias Ang, the common-law husband of Candelaria Magpayo. Because of his admission, the notice of lis pendens annotated in the four certificates of title of the land in question were ordered cancelled and the land effectively became available for disposition. Ang sought reconsideration of the order, but a compromise was reached that only one TCT (TCT No. 34266) will be annotated with a notice of lis pendens. Respondent surmised that these developments in Civil Case No. Man-2202 meant that Ang would lose his case so Ang resorted to the filing of the present administrative complaint. Thus, respondent prayed for the dismissal of the case for being devoid of any factual or legal basis, or in the alternative, holding resolution of the instant case in abeyance pending resolution of Civil Case No. Man-2202 allegedly because the issues in the present administrative case are similar to the issues or subject matters involved in said civil case.

Investigating Commissioner Lydia A. Navarro of the IBP Commission on Bar Discipline, to whom the case was referred for investigation, report and recommendation, submitted her Report and Recommendation15 finding respondent administratively liable. She recommended that respondent be suspended from the practice of law for three months. She held that respondent committed an unethical act when he allowed himself to be an instrument in the disposal of the subject property through a deed of sale executed between him as attorney-in-fact of his client and Lim Kim So Mercantile Co. despite his knowledge that said property is the subject of a pending litigation before the RTC of Mandaue City, Cebu. The Investigating Commissioner additionally found that respondent "delegated the notarial functions to the clerical staff of their office before being brought to him for his signature." This, according to the commissioner, "must have been the reason for the forged signatures of the parties in the questioned document…as well as the erroneous entry in his notarial register…."16 Nonetheless, the Investigating Commissioner merely reminded respondent to be more cautious in the performance of his duties as regards his infraction of his notarial duties. She held, Respondent should have been more

cautious in his duty as notary public which requires that the party subscribing to the authenticity of the document should personally appear and sign the same before respondent’s actual presence. As such notary public respondent should not delegate to any unqualified person the performance of any task which by law may only be performed by a member of the bar in accordance with Rule 9.0117 of the Code of Professional Responsibility.18

On November 12, 2005, the Board of Governors of the IBP issued Resolution No. XVII-2005-141,19 adopting the findings of the Investigating Commissioner but modifying the recommended penalty. Instead of suspension for three months, the Board recommended the penalty of suspension from the practice of law for one year and revocation of respondent’s notarial commission and disqualification from reappointment as notary public for two years.

Respondent filed a motion for reconsideration,20 arguing that it was neither illegal nor unethical for a lawyer to accept appointment as attorney-in-fact of a client to sell a property involved in a pending litigation and to act as such. He further contended that granting that his act was unethical, the modified penalty was evidently too harsh and extremely excessive considering that the act complained of was not unlawful and done without malice.

On December 11, 2008, the IBP Board of Governors adopted Resolution No. XVIII-2008-69821 denying respondent’s motion for reconsideration and affirming Resolution No. XVII-2005-141. Hence, this petition for review.

Respondent reiterates that being commissioned by his own clients to sell a portion of a parcel of land, part of which is involved in litigation, is not per se illegal or unethical. According to him, his clients got his help to sell part of the land and because they were residing in different provinces, they executed a Special Power of Attorney in his favor.22

We affirm the resolution of the IBP Board of Governors finding respondent administratively liable.

After reviewing the records of the case, the Court finds that respondent did not act unethically when he sold the property in dispute as the sellers’ attorney-in-fact because there was no more notice of lis pendens annotated on the particular lot sold. Likewise, the Court finds no sufficient evidence to show that the Deed of Absolute Sale executed by Candelaria Magpayo on April 17, 1989 was antedated.

However, the Court finds respondent administratively liable for violation of his notarial duties when he failed to require the personal presence of Candelaria Magpayo when he notarized the Affidavit of Loss

which Candelaria allegedly executed on April 29, 1994. Section 1 of Public Act No. 2103, otherwise known as the Notarial Law, explicitly provides:

Sec. 1. x x x

(a) The acknowledgment shall be made before a notary public or an officer duly authorized by law of the country to take acknowledgments of instruments or documents in the place where the act is done. The notary public or the officer taking the acknowledgment shall certify that the person acknowledging the instrument or document is known to him and that he is the same person who executed it, and acknowledged that the same is his free act and deed. The certificate shall be made under his official seal, if he is by law required to keep a seal, and if not, his certificate shall so state.

From the foregoing, it is clear that the party acknowledging must appear before the notary public or any other person authorized to take acknowledgments of instruments or documents.23 In the case at bar, the jurat of the Affidavit of Loss stated that Candelaria subscribed to the affidavit before respondent on April 29, 1994, at Mandaue City. Candelaria, however, was already dead since March 26, 1991. Hence, it is clear that the jurat was made in violation of the notarial law. Indeed, respondent averred in his position paper before the IBP that he did not in fact know Candelaria personally before, during and after the notarization24 thus admitting that Candelaria was not present when he notarized the documents.

Time and again, we have held that notarization of a document is not an empty act or routine.25 Thus, in Bernardo v. Atty. Ramos,26 the Court emphasized the significance of the act of notarization, to wit:

The importance attached to the act of notarization cannot be overemphasized. Notarization is not an empty, meaningless, routinary act. It is invested with substantive public interest, such that only those who are qualified or authorized may act as notaries public. Notarization converts a private document into a public document thus making that document admissible in evidence without further proof of its authenticity. A notarial document is by law entitled to full faith and credit upon its face. Courts, administrative agencies and the public at large must be able to rely upon the acknowledgment executed by a notary public and appended to a private instrument.

For this reason notaries public must observe with utmost care the basic requirements in the performance of their duties. Otherwise, the confidence of the public in the integrity of this form of conveyance would be undermined. Hence a notary public should not notarize a document unless the persons who signed the same are the very same persons who xecuted and personally appeared before him to attest to the contents and truth of what are stated therein. The purpose of this requirement is to enable the notary public to verify the genuineness of the signature of the acknowledging party and to ascertain that the document is the party’s free act and deed.

A notary public’s function should not be trivialized and a notary public must discharge his powers and duties which are impressed with public interest, with accuracy and fidelity.27 It devolves upon respondent to act with due care and diligence in stamping fiat on the questioned documents. Respondent’s failure to perform his duty as a notary public resulted in undermining the integrity of a notary public and in degrading the function of notarization. Hence, he should be liable for his infraction, not only as a notary public but also as a lawyer.

As a lawyer commissioned as notary public, respondent is mandated to subscribe to the sacred duties appertaining to his office, such duties being dictated by public policy impressed with public interest. Faithful observance and utmost respect of the legal solemnity of the oath in an acknowledgment or jurat is sacrosanct.1âwphi1 Simply put, such responsibility is incumbent upon respondent and failing therein, he must now accept the commensurate consequences of his professional indiscretion.28 As the Court has held in Flores v. Chua,29

Where the notary public is a lawyer, a graver responsibility is placed upon his shoulder by reason of his solemn oath to obey the laws and to do no falsehood or consent to the doing of any. The Code of Professional Responsibility also commands him not to engage in unlawful, dishonest, immoral or deceitful conduct and to uphold at all times the integrity and dignity of the legal profession. (Emphasis supplied.)

Respondent likewise violated Rule 9.01, Canon 9, of the Code of Professional Responsibility which provides that "[a] lawyer shall not delegate to any unqualified person the performance of any task which by law may only be performed by a member of the Bar in good standing." Respondent averred in his position paper that it had been his consistent practice to course through clerical staff documents to be notarized. Upon referral, said clerical staff investigates whether the documents are complete as to the fundamental requirements and inquires as to the identity of the individual signatories thereto. If everything is in order, they ask the parties to sign the documents and forward them to him and he again inquires about the identities of the parties before affixing his notarial signature.30 It is also his clerical staff who records entries in his notarial report. As aforesaid, respondent is mandated to observe with utmost care the basic requirements in the performance of his duties as a notary and to ascertain that the persons who signed the documents are the very same persons who executed and personally appeared before him to attest to the contents and truth of what are stated therein. In merely relying on his clerical staff to determine the completeness of documents brought to him for notarization, limiting his participation in the notarization process to simply inquiring about the identities of the persons appearing before him, and in notarizing an affidavit executed by a dead person, respondent is liable for misconduct. Under the facts and circumstances of the case, the revocation of his notarial commission, disqualification from being commissioned as a notary public for a period of two years and suspension from the practice of law for one year are in order.31

WHEREFORE, respondent Atty. James Joseph Gupana is found administratively liable for misconduct and is SUSPENDED from the practice of law for one year. Further, his notarial commission, if any, is REVOKED and he is disqualified from reappointment as Notary Public for a period of two years, with a stem warning that repetition of the same or similar conduct in the future will be dealt with more severely.

Let copies of this Decision be furnished to the Office of the Bar Confidant, the Integrated Bar of the Philippines, and all courts all over the country. Let a copy of this Decision likewise be attached to the personal records of respondent.

SO ORDERED.

MARTIN S. VILLARAMA, JR.

Associate Justice

WE CONCUR:

A.C. No. 9116 March 12, 2014

NESTOR B. FIGUERAS and BIENVENIDO VICTORIA, JR., Complainants,

vs.

ATTY. DIOSDADO B. JIMENEZ, Respondent.

R E S O L U T I O N

VILLARAMA, JR., J.:

Before us is a petition for review filed by Atty. Diosdado B. Jimenez assailing the February 19, 2009 Resolution1 of the Board of Governors of the Integrated Bar of the Philippines (IBP) suspending him from the practice of law for a period of six months for breach of Rule 12.03,2 Canon 12,3 Canon 17,4 Rule 18.03,5 and Canon 186 of the Code of Professional Responsibility. He likewise assails the June 26, 2011 Resolution7 of the IBP Board of Governors denying his motion for reconsideration.

The facts are as follows:

Congressional Village Homeowner’s Association, Inc. is the entity in charge of the affairs of the homeowners of Congressional Village in Quezon City. On January 7, 1993, the Spouses Federico and Victoria Santander filed a civil suit for damages against the Association and Ely Mabanag8 before the Regional Trial Court (RTC) of Quezon City, Branch 104 for building a concrete wall which abutted their property and denied them of their right of way. The spouses Santander likewise alleged that said concrete wall was built in violation of Quezon City Ordinance No. 8633, S-71 which prohibits the closing, obstructing, preventing or otherwise refusing to the public or vehicular traffic the use of or free access to any subdivision or community street.9 The Law Firm of Gonzalez Sinense Jimenez and Associates was the legal counsel for the Association, with respondent as the counsel of record and handling lawyer. After trial and hearing, the RTC rendered a decision10 on October 4, 1996 in favor of the Spouses Santander. The Association, represented by said law firm, appealed to the Court of Appeals (CA). On February 5, 1999, the CA issued a Resolution11 in CA-G.R. CV No. 55577 dismissing the appeal on the ground that the original period to file the appellant’s brief had expired 95 days even before the first motion for extension of time to file said brief was filed. The CA also stated that the grounds adduced for the said motion as well as the six subsequent motions for extension of time to file brief were not meritorious. The CA resolution became final.

Eight years later or on April 11, 2007, complainants Nestor Figueras and Bienvenido Victoria, Jr., as members of the Association, filed a Complaint12 for Disbarment against respondent before the IBP Committee on Bar Discipline (CBD) for violation of the Code of Professional Responsibility, particularly Rule 12.03, Canon 12; Canon 17; and Rule 18.03, Canon 18 thereof for his negligence in handling the appeal and willful violation of his duties as an officer of the court.

In his Verified Answer with Counter Complaint,13 respondent denied administrative liability. He claimed that although his law firm represented the homeowner’s association in CA-G.R. CV No. 55577, the case was actually handled by an associate lawyer in his law office. As the partner in charge of the case, he exercised general supervision over the handling counsel and signed the pleadings prepared by said handling lawyer. Upon discovery of the omissions of the handling lawyer, appropriate sanctions were imposed on the handling lawyer and he thereafter personally took responsibility and spent personal funds to negotiate a settlement with Federico Santander at no cost to the Association. No damage whatsoever was caused to the Association.

Respondent likewise alleged that after he defeated complainant Figueras in the election for President of the homeowner’s association in 1996, Figueras and his compadre, complainant Victoria, stopped paying their association dues and other assessments. Complainants and other delinquent members of the association were sanctioned by the Board of Directors and were sued by the association before the Housing and Land Use Regulatory Board (HLURB). In retaliation, complainants filed the present disbarment case against him and several other cases against him and other officers of the association

before the HLURB to question, among others, the legitimacy of the Association, the election of its officers, and the sanctions imposed by the Association. Thus, he concluded that the disbarment case was filed to harass him. Respondent added that complainants have no personality to file the disbarment complaint as they were not his clients; hence, there was likewise no jurisdiction over the complaint on the part of the IBP-CBD.

As counterclaim, respondent prayed for the outright dismissal of the disbarment case for lack of merit, the imposition of sanctions on complainants, and the payment of damages for the filing of the baseless complaint for disbarment.

On October 3, 2008, the Investigating Commissioner of the IBP-CBD found respondent liable for violation of the Code of Professional Responsibility, particularly Rule 12.03 of Canon 12, Canon 17, Rule 18.03, and Canon 18 thereof, and recommended that respondent be suspended from the practice of law for a period of three to six months, with warning that a repetition of the same or similar offense shall be dealt with more severely.14

On February 19, 2009, the Board of Governors of the IBP issued Resolution No. XVIII-2009-1415 adopting the recommendation with modifications as follows:

RESOLVED to ADOPT and APPROVE, as it is hereby ADOPTED and APPROVED, with modification, the Report and Recommendation of the Investigating Commissioner of the above-entitled case, herein made part of this Resolution [as] Annex "A"; and, finding the recommendation fully supported by the evidence on record and the applicable laws and rules, and considering Respondent’s breach of Rule 12.03, Canon 12, Canon 17, Rule 18.03 and Canon 18 of the Code of Professional Responsibility, Atty. Diosdado B. Jimenez is hereby SUSPENDED from the practice of law for six (6) months. The Warning imposed against respondent is hereby deleted.

Respondent sought reconsideration of the resolution but his motion was denied in IBP Resolution No. XIX-2011-480 dated June 26, 2011.16 The IBP Board of Governors noted that respondent’s motion was a mere reiteration of matters already discussed and there were no substantial grounds to disturb the February 19, 2009 Resolution.

Respondent now comes to this Court essentially raising the issue whether the IBP correctly found him administratively liable for violation of Rule 12.03, Canon 12, Canon 17, Rule 18.03, and Canon 18 of the Code of Professional Responsibility.

After careful consideration of the records of the case, the Court finds that the suspension of respondent from the practice of law is proper.

The Court finds no merit in respondent’s contention that complainants have no personality to file a disbarment case against him as they were not his clients and that the present suit was merely instituted to harass him.

The procedural requirement observed in ordinary civil proceedings that only the real party-in-interest must initiate the suit does not apply in disbarment cases. In fact, the person who called the attention of the court to a lawyer’s misconduct "is in no sense a party, and generally has no interest in the outcome."17

In Heck v. Judge Santos,18 the Court held that "[a]ny interested person or the court motu proprio may initiate disciplinary proceedings." The right to institute disbarment proceedings is not confined to clients nor is it necessary that the person complaining suffered injury from the alleged wrongdoing. Disbarment proceedings are matters of public interest and the only basis for the judgment is the proof or failure of proof of the charges.

The Court agrees with the IBP that respondent had been remiss in the performance of his duties as counsel for Congressional Village Homeowner’s Association, Inc. Records show that respondent filed the first motion for extension of time to file appellant’s brief 95 days after the expiration of the reglementary period to file said brief, thus causing the dismissal of the appeal of the homeowner’s association. To justify his inexcusable negligence, respondent alleges that he was merely the supervising lawyer and that the fault lies with the handling lawyer. His contention, however, is belied by the records for we note that respondent had filed with the CA an Urgent Motion for Extension, which he himself signed on behalf of the law firm, stating that a previous motion had been filed but "due to the health condition of the undersigned counsel…he was not able to finish said Appellants’ Brief within the fifteen (15) day period earlier requested by him."19 Thus, it is clear that respondent was personally in charge of the case.

A lawyer engaged to represent a client in a case bears the responsibility of protecting the latter’s interest with utmost diligence. In failing to file the appellant’s brief on behalf of his client, respondent had fallen far short of his duties as counsel as set forth in Rule 12.04,20 Canon 12 of the Code of Professional Responsibility which exhorts every member of the Bar not to unduly delay a case and to exert every effort and consider it his duty to assist in the speedy and efficient administration of justice. Rule 18.03, Canon 18 of the same Code also states that:

Canon 18—A lawyer shall serve his client with competence and diligence.

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

In In Re: Atty. Santiago F. Marcos21 the Court considered a lawyer’s failure to file brief for his client as amounting to inexcusable negligence. The Court held:

An attorney is bound to protect his client’s interest to the best of his ability and with utmost diligence.1âwphi1 (Del Rosario vs. Court of Appeals, 114 SCRA 159) A failure to file brief for his client certainly constitutes inexcusable negligence on his part. (People vs. Villar, 46 SCRA 107) The respondent has indeed committed a serious lapse in the duty owed by him to his client as well as to the Court not to delay litigation and to aid in the speedy administration of justice. (Canons 21 and 22, Canons of Professional Ethics; People vs. Daban, 43 SCRA 185; People vs. Estocada, 43 SCRA 515).

It has been stressed that the determination of whether an attorney should be disbarred or merely suspended for a period involves the exercise of sound judicial discretion.22 The penalties for a lawyer’s failure to file a brief or other pleading range from reprimand,23 warning with fine,24 suspension25 and, in grave cases, disbarment.26 In the present case, we find too harsh the recommendation of the IBP Board of Governors that respondent be suspended from the practice of law for a period of six months. Under the circumstances, we deem the penalty of suspension for one month from the practice of law to be more commensurate with the extent of respondent’s violation.

WHEREFORE, the petition is DENIED. Atty. Diosdado B. Jimenez is found administratively liable for violation of Rule 12.04, Canon 12 and Rule 18.03, Canon 18 of the Code of Professional Responsibility. He is suspended from the practice of law for one (1) month effective from finality of this Resolution, with warning that a repetition of the same or similar violation shall be dealt with more severely.

Let a copy of this Resolution be furnished, upon its finality, to the Integrated Bar of the Philippines and all the courts in the Philippines, and spread on the personal record of respondent lawyer in the Office of the Bar Confidant, Supreme Court of the Philippines.

SO ORDERED.

MARTIN S. VILLARAMA, JR.

Associate Justice

A.M. No. RTJ-09-2200 April 2, 2014

(formerly OCA I.P.I. No. 08-2834-RTJ)

ANTONIO M. LORENZANA, Complainant,

vs.

JUDGE MA. CECILIA I. AUSTRIA, Regional Trial Court, Branch 2, Batangas City, Respondent.

D E C I S I O N

BRION, J.:

We resolve in this Decision the administrative complaints1 filed by Antonio M. Lorenzana (complainant) against Judge Ma. Cecilia I. Austria (respondent), Regional Trial Court (RTC), Branch 2, Batangas City.

The records show that the administrative complaints arose from the case "In the Matter of the Petition to have Steel Corporation of the Philippines Placed under Corporate Rehabilitation with Prayer for the Approval of the Proposed Rehabilitation Plan," docketed as SP. Proc. No. 06-7993, where the respondent was the presiding judge. The complainant was the Executive Vice President and Chief Operating Officer of Steel Corporation of the Philippines (SCP), a company then under rehabilitation proceedings.

i. Complaint

In his verified complaint dated January 21, 2008, the complainant alleged that in the course of SP. Proc. No. 06-7993, the respondent committed Gross Ignorance of the Law, Grave Abuse of Authority, Gross Misconduct, Grave Incompetence, Irregularity in the Performance of Duty, Grave Bias and Partiality, Lack of Circumspection, Conduct Unbecoming of a Judge, Failure to Observe the Reglementary Period and Violation of the Code of Professional Responsibility, as shown by the following instances:

1. The respondent appointed Atty. Santiago T. Gabionza, Jr. as rehabilitation receiver over SCP’s objections and despite serious conflict of interest in being the duly appointed rehabilitation receiver for

SCP and, at the same time, the external legal counsel of most of SCP’s creditors; he is also a partner of the law firm that he engaged as legal adviser.

2. The respondent conducted informal meetings (which she termed as "consultative meetings" in her Order2 dated May 11, 2007) in places outside her official jurisdiction (i.e., a first class golf club, a hotel and sports club facilities in Metro Manila) and where she arbitrarily dictated the terms, parameters and features of the rehabilitation plan she wanted to approve for SCP. She also announced in the meetings that she would prepare the rehabilitation plan for SCP.

3. The modified rehabilitation plan submitted by Atty. Gabionza is a replica of what the respondent dictated to him. Thus, the respondent exceeded the limits of her authority and effectively usurped and pre-empted the rehabilitation receiver’s exercise of functions.

4. The respondent ordered that the proceedings of the informal meetings be off-record so that there would be no record that she had favored Equitable-PCI Bank (EPCIB).

5. The respondent had secret meetings and communications with EPCIB to discuss the case without the knowledge and presence of SCP and its creditors.

6. The respondent appointed Gerardo Anonas (Anonas) as Atty. Gabionza’s financial adviser and, at the same time, as her financial adviser to guide her in the formulation and development of the rehabilitation plan, for a fee of P3.5M at SCP’s expense. Anonas is also the cousin-in-law of the managing partner of Atty. Gabionza’s law firm.

7. The respondent encouraged EPCIB to raise complaints or accusations against SCP, leading to EPCIB’s filing of a motion to create a management committee.

8. When requested to conduct an evidentiary meeting and to issue a subpoena (so that SCP could confront EPCIB’s witnesses to prove the allegation that there was a need for the creation of a management committee), the respondent denied SCP’s requests and delayed the issuance of the order until the last minute.

9. At the hearing of September 14, 2007, the respondent intimidated SCP’s counsel, Atty. Ferdinand Topacio; blocked his every attempt to speak; refused to recognize his appearances in court; and made condescending and snide remarks.

10. The respondent failed to observe the reglementary period prescribed by the Interim Rules of Procedure on Corporate Rehabilitation (Rules). She approved the rehabilitation plan beyond the 180 days given to her in the Rules, without asking for permission to extend the period from the Supreme Court (SC).

11. The respondent erroneously interpreted and applied Section 23, Rule 4 of the Rules (the court’s power to approve the rehabilitation plan) to include the power to amend, modify and alter it.

12. The respondent took a personal interest and commitment to decide the matter in EPCIB’s favor and made comments and rulings in the proceedings that raised concerns regarding her impartiality.

13. The respondent adamantly refused to inhibit herself and showed special interest and personal involvement in the case.

ii. Supplemental Complaint

The complainant likewise filed a supplemental complaint3 dated April 14, 2008 where he alleged that the respondent committed an act of impropriety when she displayed her photographs in a social networking website called "Friendster" and posted her personal details as an RTC Judge, allegedly for the purpose of finding a compatible partner. She also posed with her upper body barely covered by a shawl, allegedly suggesting that nothing was worn underneath except probably a brassiere.

The Office of the Court Administrator (OCA) in its 1st Indorsement4 dated March 18, 2008, referred the complaints to the respondent for comment.

a. Comment to January 21, 2008 Complaint

The respondent vehemently denied the allegations against her. While she admitted that she crafted a workable, feasible rehabilitation plan best suited for SCP, she maintained that she did so only to render fairness and equity to all the parties to the rehabilitation proceedings. She also submitted that if indeed she erred in modifying the rehabilitation plan, hers was a mere error of judgment that does not call for an administrative disciplinary action. Accordingly, she claimed that the administrative complaints were premature because judicial remedies were still available.5

The respondent also argued that the rules do not prohibit informal meetings and conferences. On the contrary, she argued that informal meetings are even encouraged in view of the summary and non-adversarial nature of rehabilitation proceedings. Since Section 21, Rule 4 of the Rules6 gives the rehabilitation receiver the power to meet with the creditors, then there is all the more reason for the rehabilitation judge, who has the authority to approve the plan, to call and hold meetings with the parties. She also pointed out that it was SCP which suggested that informal meetings be called and that she only agreed to hold these meetings on the condition that all the parties would attend.

As to her alleged failure to observe the reglementary period, she contended that she approved the rehabilitation plan within the period prescribed by law. She argued that the matter of granting extension of time under Section 11, Rule 4 of the Rules7 pertains not to the SC, but to the rehabilitation court.

The respondent likewise refuted the allegations of bias and partiality. First, she claimed that her denial of the complainant’s motion for inhibition was not due to any bias or prejudice on her part but due to lack of basis. Second, she argued that her decision was not orchestrated to favor EPCIB, as evidenced by the fact that EPCIP itself (as some other creditors did) promptly appealed her decision to the Court of Appeals (CA). Third, she did not remove Atty. Gabionza as SCP’s rehabilitation receiver because she disagreed that the grounds the complainant raised warranted his removal.

She also found no merit to the allegation of conflict of interest. Lastly, she maintained that the rest of the complainant’s allegations were not substantiated and corroborated by evidence.

The respondent further alleged that she did not gravely abuse her authority in not issuing a subpoena as Section 1, Rule 3 of the Interim Rules on Corporate Rehabilitation of the Rules specifically states that the court may decide matters on the basis of affidavits and other documentary evidence.

On the allegation of conflict of interest, she maintained that the allegations were not proven and substantiated by evidence. Finally, the respondent also believed that there was nothing improper in expressing her ideas during the informal meetings.

b. Comment to April 14, 2008 Supplemental Complaint

In her comment8 on the supplemental complaint, the respondent submitted that the photos she posted in the social networking website "Friendster" could hardly be considered vulgar or lewd. She added that an "off-shouldered" attire is an acceptable social outfit under contemporary standards and is not

forbidden. She further stated that there is no prohibition against attractive ladies being judges; she is proud of her photo for having been aesthetically made. Lastly, she submitted that the ruling of the Court in the case of Impao v. Judge Makilala9 should not be applied to her case since the facts are different.

On July 4, 2008, the complainant filed a reply,10 insisting that the respondent’s acts of posting "seductive" pictures and maintaining a "Friendster" account constituted acts of impropriety, in violation of Rules 2.01,11 2.0212 and 2.03,13 Canon 2 of the Code of Judicial Conduct.

In a Resolution14 dated September 9, 2009, the Court re-docketed the complaints as regular administrative matters, and referred them to the CA for investigation, report and recommendation.

The CA’s Report and Recommendation

On November 13, 2009, Justice Marlene Gonzales-Sison, the Investigating Justice, conducted a hearing, followed by the submission of memoranda by both parties. In her January 4, 2010 Report and Recommendation,15 Justice Gonzales-Sison ruled that the complaints were partly meritorious. She found that the issues raised were judicial in nature since these involved the respondent’s appreciation of evidence.

She also added that while the CA resolved to set aside the respondent’s decision in the rehabilitation proceedings, it was not by reason of her ignorance of the law or abuse of authority, but because the rehabilitation plan could no longer be implemented in view of SCP’s financial predicament.

On the allegation of grave bias and partiality in handling the rehabilitation proceedings, Justice Gonzales-Sison ruled that the complainant failed to present any clear and convincing proof that the respondent intentionally and deliberately acted against SCP’s interests; the complaint merely relied on his opinions and surmises.

On the matter of the respondent’s inhibition, she noted that in cases not covered by the rule on mandatory inhibition, the decision to inhibit lies within the discretion of the sitting judge and is primarily a matter of conscience.

With respect to the respondent’s informal meetings, Justice Gonzales-Sison found nothing irregular despite the out-of-court meetings as these were agreed upon by all the parties, including SCP’s

creditors. She also found satisfactory the respondent’s explanation in approving the rehabilitation plan beyond the 180-day period prescribed by the Rules.

The foregoing notwithstanding, Justice Gonzales-Sison noted the respondent’s unnecessary bickering with SCP’s legal counsel and ruled that her exchanges and utterances were reflective of arrogance and superiority. In the words of the Justice Gonzales-Sison:

Rather than rule on the manifestations of counsels, she instead brushed off the matter with what would appear to be a conceited show of a prerogative of her office, a conduct that falls below the standard of decorum expected of a judge. Her statements appear to be done recklessly and were uncalled for. xxx. Section 6[,] Canon 6 of the New Code of Judicial Conduct for the Philippine Judiciary states that: judges shall maintain order and decorum in all proceedings before the court and be patient, dignified and courteous in relation to litigants, witnesses, lawyers and others whom the judge deals in an official capacity. Judicial decorum requires judges to be temperate in their language at all times. Failure on this regard amounts to a conduct unbecoming of a judge, for which Judge Austria should be held liable.16

On the respondent’s Friendster account, she believes that her act of maintaining a personal social networking account (displaying photos of herself and disclosing personal details as a magistrate in the account) – even during these changing times when social networking websites seem to be the trend – constitutes an act of impropriety which cannot be legally justified by the public’s acceptance of this type of conduct. She explained that propriety and the appearance of propriety are essential to the performance of all the activities of a judge and that judges shall conduct themselves in a manner consistent with the dignity of the judicial office.

Finally, Justice Gonzales-Sison noted the CA’s May 16, 2006 Decision17 in CA-G.R. SP No. 100941 finding that the respondent committed grave abuse of discretion in ordering the creation of a management committee without first conducting an evidentiary hearing in accordance with the procedures prescribed under the Rules. She ruled that such professional incompetence was tantamount to gross ignorance of the law and procedure, and recommended a fine of P20,000.00. She also recommended that the respondent be admonished for failing to observe strict propriety and judicial decorum required by her office.

The Action and Recommendation of the OCA

In its Memorandum18 dated September 4, 2013, the OCA recommended the following:

RECOMMENDATION: It is respectfully recommended for the consideration of the Honorable Court that:

1) the Report dated January 4, 2010 of Investigating Justice Marlene Gonzales-Sison be NOTED;

2) respondent Judge Ma. Cecilia I. Austria, Branch 2, Regional Trial Court, Batangas City, Batangas, be found GUILTY of conduct unbecoming a judge and for violation of Section 6, Canon 4 of the New Code of Judicial Conduct;

3) respondent Judge Austria be FINED in the amount of Twenty Thousand Pesos (Php20,000.00); and

4) respondent Judge Austria be ADMONISHED to refrain from further acts of impropriety with a stern warning that a repetition of the same or any similar act will be dealt with more severely.19

In arriving at its recommendation the OCA found that the respondent was not guilty of gross ignorance of the law as the complainant failed to prove that her orders were motivated by bad faith, fraud, dishonesty or corruption.

The OCA also found that the charges of bias and partiality in handling the rehabilitation proceedings were not supported by evidence. It accepted the respondent’s explanation in the charge of failure to observe the reglementary period.

Lastly, the OCA maintained that the allegations of grave abuse of authority and gross incompetence are judicial in nature, hence, they should not be the subject of disciplinary action. On the other hand, on allegations of conduct unbecoming of a judge, violation of the Code of Professional Responsibility (Code), lack of circumspection and impropriety, the OCA shared Justice Gonzales-Sison’s observations that the respondent’s act of posting seductive photos in her Friendster account contravened the standard of propriety set forth by the Code.

The Court’s Ruling

We agree with the recommendation of both Justice Gonzales-Sison and the OCA for the imposition of a fine on the respondent but modify the amount as indicated below. We sustain Justice Gonzales-Sison’s finding of gross ignorance of the law in so far as the respondent ordered the creation of a management committee without conducting an evidentiary hearing. The absence of a hearing was a matter of basic due process that no magistrate should be forgetful or careless about.

On the Charges of Grave Abuse of Authority;

Irregularity in the Performance of Duty; Grave

Bias and Partiality; and Lack of Circumspection

It is well settled that in administrative cases, the complainant bears the onus of proving the averments of his complaint by substantial evidence.20 In the present case, the allegations of grave abuse of authority, irregularity in the performance of duty, grave bias and partiality, and lack of circumspection are devoid of merit because the complainant failed to establish the respondent’s bad faith, malice or ill will. The complainant merely pointed to circumstances based on mere conjectures and suppositions. These, by themselves, however, are not sufficient to prove the accusations. "[M]ere allegation is not evidence and is not equivalent to proof."21

"[U]nless the acts were committed with fraud, dishonesty, corruption, malice or ill-will, bad faith, or deliberate intent to do an injustice, [the] respondent judge may not be held administratively liable for gross misconduct, ignorance of the law or incompetence of official acts in the exercise of judicial functions and duties, particularly in the adjudication of cases."22

Even granting that the respondent indeed erred in the exercise of her judicial functions, these are, at best, legal errors correctible not by a disciplinary action, but by judicial remedies that are readily available to the complainant. "An administrative complaint is not the appropriate remedy for every irregular or erroneous order or decision issued by a judge where a judicial remedy is available, such as a motion for reconsideration or an appeal."23 Errors committed by him/her in the exercise of adjudicative functions cannot be corrected through administrative proceedings but should be assailed instead through judicial remedies.24

On the Charges of Grave Bias and Partiality

We likewise find the allegations of bias and partiality on the part of the respondent baseless. The truth about the respondent’s alleged partiality cannot be determined by simply relying on the complainant’s verified complaint. Bias and prejudice cannot be presumed, in light especially of a judge’s sacred obligation under his oath of office to administer justice without respect to the person, and to give equal right to the poor and rich.25 There should be clear and convincing evidence to prove the charge; mere suspicion of partiality is not enough.26

In the present case, aside from being speculative and judicial in character, the circumstances cited by the complainant were grounded on mere opinion and surmises. The complainant, too, failed to adduce proof indicating the respondent’s predisposition to decide the case in favor of one party. This kind of evidence would have helped its cause. The bare allegations of the complainant cannot overturn the presumption that the respondent acted regularly and impartially. We thus conclude that due to the complainant’s failure to establish with clear, solid, and convincing proof, the allegations of bias and partiality must fail.

On the Charges of Grave Incompetence

and Gross Ignorance of the Law

We agree with the findings of the OCA that not every error or mistake of a judge in the performance of his official duties renders him liable.27 "[A]s a matter of policy, in the absence of fraud, dishonesty or corruption, the acts of a judge in his judicial capacity are not subject to disciplinary action even though such acts are erroneous."28

In the present case, what was involved was the respondent’s application of Section 23, Rule 4 of the Rules, which provides:

Sec. 23. Approval of the Rehabilitation Plan. - The court may approve a rehabilitation plan even over the opposition of creditors holding a majority of the total liabilities of the debtor if, in its judgment, the rehabilitation of the debtor is feasible and the opposition of the creditors is manifestly unreasonable.29

The respondent approved the rehabilitation plan submitted by Atty. Gabionza, subject to the modifications she found necessary to make the plan viable. The complainant alleged that in modifying the plan, she exceeded her authority and effectively usurped the functions of a rehabilitation receiver. We find, however, that in failing to show that the respondent was motivated by bad faith or ill motives in rendering the assailed decision, the charge of gross ignorance of the law against her should be dismissed. "To [rule] otherwise would be to render judicial office untenable, for no one called upon to try the facts or interpret the law in the process of administering justice can be infallible in his judgment."30

To constitute gross ignorance of the law, it is not enough that the decision, order or actuation of the judge in the performance of his official duties is contrary to existing law and jurisprudence. It must also be proven that he was moved by bad faith, fraud, dishonesty or corruption31 or had committed an error so egregious that it amounted to bad faith.

In the present case, nothing in the records suggests that the respondent was motivated by bad faith, fraud, corruption, dishonesty or egregious error in rendering her decision approving the modified rehabilitation plan. Besides his bare accusations, the complainant failed to substantiate his allegations with competent proof. Bad faith cannot be presumed32 and this Court cannot conclude that bad faith intervened when none was actually proven.

With respect to the action of the respondent in ordering the creation of a management committee without first conducting an evidentiary hearing for the purpose, however, we find the error to be so egregious as to amount to bad faith, leading to the conclusion of gross ignorance of the law, as charged.

Due process and fair play are basic requirements that no less than the Constitution demands. In rehabilitation proceedings, the parties must first be given an opportunity to prove (or disprove) the existence of an imminent danger of dissipation, loss, wastage or destruction of the debtor-company’s assets and properties that are or may be prejudicial to the interest of minority stockholders, parties-litigants or the general public.33 The rehabilitation court should hear both sides, allow them to present proof and conscientiously deliberate, based on their submissions, on whether the appointment of a management receiver is justified. This is a very basic requirement in every adversarial proceeding that no judge or magistrate can disregard.

In SCP’s rehabilitation proceedings, SCP was not given at all the opportunity to present its evidence, nor to confront the EPCIB witnesses. Significantly, the CA, in its May 16, 2006 decision, found that the respondent’s act of denying SCP the opportunity to disprove the grounds for the appointment of a management committee was tantamount to grave abuse of discretion. As aptly observed by Justice Gonzales-Sison:

[T]he acts of the respondent judge (Judge Austria) in creating a MANCOM without observing the procedures prescribed under the IRPGICC clearly constitute grave abuse of discretion amounting to excess of jurisdiction.34

Indeed, while a judge may not be held liable for gross ignorance of the law for every erroneous order that he renders, this does not mean that a judge need not observe due care in the performance of his/her official functions.35 When a basic principle of law is involved and when an error is so gross and patent, error can produce an inference of bad faith, making the judge liable for gross ignorance of the law.36 On this basis, we conclude that the respondent’s act of promptly ordering the creation of a management committee, without the benefit of a hearing and despite the demand for one, was tantamount to punishable professional incompetence and gross ignorance of the law.

On the Ground of Failure to Observe

the Reglementary Period

On the respondent’s failure to observe the reglementary period prescribed by the Rules, we find the respondent’s explanation to be satisfactory.

Section 11, Rule 4 of the previous Rules provides:

Sec. 11. Period of the Stay Order. – xxx

The petition shall be dismissed if no rehabilitation plan is approved by the court upon the lapse of one hundred eighty (180) days from the date of the initial hearing. The court may grant an extension beyond this period only if it appears by convincing and compelling evidence that the debtor may successfully be rehabilitated. In no instance, however, shall the period for approving or disapproving a rehabilitation plan exceed eighteen (18) months from the date of filing of the petition.37

Under this provision, the matter of who would grant the extension beyond the 180-day period carried a good measure of ambiguity as it did not indicate with particularity whether the rehabilitation court could act by itself or whether Supreme Court approval was still required. Only recently was this uncertainty clarified when A.M. No. 00-8-10-SC, the 2008 Rules of Procedure on Corporate Rehabilitation, took effect.

Section 12, Rule 4 of the Rules provides:

Section 12. Period to Decide Petition. - The court shall decide the petition within one (1) year from the date of filing of the petition, unless the court, for good cause shown, is able to secure an extension of the period from the Supreme Court.38

Since the new Rules only took effect on January 16, 2009 (long after the respondent’s approval of the rehabilitation plan on December 3, 2007), we find no basis to hold the respondent liable for the extension she granted and for the consequent delay.

On the Ground of Conduct

Unbecoming of a Judge

On the allegation of conduct unbecoming of a judge, Section 6, Canon 6 of the New Code of Judicial Conduct states that:

SECTION 6. Judges shall maintain order and decorum in all proceedings before the court and be patient, dignified and courteous in relation to litigants, witnesses, lawyers and others with whom the judge deals in an official capacity. Judges shall require similar conduct of legal representatives, court staff and others subject to their influence, direction or control.39

A judge should always conduct himself in a manner that would preserve the dignity, independence and respect for himself/herself, the Court and the Judiciary as a whole. He must exhibit the hallmark judicial temperament of utmost sobriety and self-restraint.40 He should choose his words and exercise more caution and control in expressing himself. In other words, a judge should possess the virtue of gravitas.41

As held in De la Cruz (Concerned Citizen of Legazpi City) v. Judge Carretas,42 a judge should be considerate, courteous and civil to all persons who come to his court; he should always keep his passion guarded. He can never allow it to run loose and overcome his reason. Furthermore, a magistrate should not descend to the level of a sharp-tongued, ill-mannered petty tyrant by uttering harsh words, snide remarks and sarcastic comments.

Similarly in Attys. Guanzon and Montesino v. Judge Rufon,43 the Court declared that "although respondent judge may attribute his intemperate language to human frailty, his noble position in the bench nevertheless demands from him courteous speech in and out of court.

Judges are required to always be temperate, patient and courteous, both in conduct and in language."

Accordingly, the respondent’s unnecessary bickering with SCP’s legal counsel, her expressions of exasperation over trivial procedural and negligible lapses, her snide remarks, as well as her condescending attitude, are conduct that the Court cannot allow. They are displays of arrogance and air of superiority that the Code abhors.

Records and transcripts of the proceedings bear out that the respondent failed to observe judicial temperament and to conduct herself irreproachably. She also failed to maintain the decorum required by the Code and to use temperate language befitting a magistrate. "As a judge, [she] should ensure that

[her] conduct is always above reproach and perceived to be so by a reasonable observer. [She] must never show conceit or even an appearance thereof, or any kind of impropriety."44

Section 1, Canon 2 of the New Code of Judicial Conduct states that:

SECTION 1. Judges shall ensure that not only is their conduct above reproach, but that it is perceived to be so in the view of a reasonable observer.

In these lights, the respondent exhibited conduct unbecoming of a judge and thus violated Section 6, Canon 6 and Section 1, Canon 2 of the New Code of Judicial Conduct.

On the Ground of Impropriety

We are not unaware of the increasing prevalence of social networking sites in the Internet – a new medium through which more and more Filipinos communicate with each other.45 While judges are not prohibited from becoming members of and from taking part in social networking activities, we remind them that they do not thereby shed off their status as judges. They carry with them in cyberspace the same ethical responsibilities and duties that every judge is expected to follow in his/her everyday activities. It is in this light that we judge the respondent in the charge of impropriety when she posted her pictures in a manner viewable by the public.

Lest this rule be misunderstood, the New Code of Judicial Conduct does not prohibit a judge from joining or maintaining an account in a social networking site such as Friendster. Section 6, Canon 4 of the New Code of Judicial Conduct recognizes that judges, like any other citizen, are entitled to freedom of expression. This right "includes the freedom to hold opinions without interference and impart information and ideas through any media regardless of frontiers."46 Joining a social networking site is an exercise of one’s freedom of expression. The respondent judge’s act of joining Friendster is, therefore, per se not violative of the New Code of Judicial Conduct.

Section 6, Canon 4 of the New Code of Judicial Conduct, however, also imposes a correlative restriction on judges: in the exercise of their freedom of expression, they should always conduct themselves in a manner that preserves the dignity of the judicial office and the impartiality and independence of the Judiciary.

This rule reflects the general principle of propriety expected of judges in all of their activities, whether it be in the course of their judicial office or in their personal lives. In particular, Sections 1 and 2 of Canon 4 of the New Code of Judicial Conduct prohibit impropriety and even the appearance of impropriety in all of their activities:

SECTION 1. Judges shall avoid impropriety and the appearance of impropriety in all of their activities.

SECTION 2. As a subject of constant public scrutiny, judges must accept personal restrictions that might be viewed as burdensome by the ordinary citizen and should do so freely and willingly. In particular, judges shall conduct themselves in a way that is consistent with the dignity of the judicial office.

Based on this provision, we hold that the respondent disregarded the propriety and appearance of propriety required of her when she posted Friendster photos of herself wearing an "off-shouldered" suggestive dress and made this available for public viewing.

To restate the rule: in communicating and socializing through social networks, judges must bear in mind that what they communicate – regardless of whether it is a personal matter or part of his or her judicial duties – creates and contributes to the people’s opinion not just of the judge but of the entire Judiciary of which he or she is a part. This is especially true when the posts the judge makes are viewable not only by his or her family and close friends, but by acquaintances and the general public.

Thus, it may be acceptable for the respondent to show a picture of herself in the attire she wore to her family and close friends, but when she made this picture available for public consumption, she placed herself in a situation where she, and the status she holds as a judge, may be the object of the public’s criticism and ridicule. The nature of cyber communications, particularly its speedy and wide-scale character, renders this rule necessary.

We are not also unaware that the respondent’s act of posting her photos would seem harmless and inoffensive had this act been done by an ordinary member of the public. As the visible personification of law and justice, however, judges are held to higher standards of conduct and thus must accordingly comport themselves.47

This exacting standard applies both to acts involving the judicial office and personal matters.1âwphi1 The very nature of their functions requires behavior under exacting standards of morality, decency and propriety; both in the performance of their duties and their daily personal lives, they should be beyond reproach.48 Judges necessarily accept this standard of conduct when they take their oath of office as magistrates.

Imposable Penalty

Under Section 8, Rule 140 of the Rules of Court, as amended by A.M. No. 01-8-10-SC, gross ignorance of the law or procedure is classified as a serious charge. Under Section 11(A) of the same Rule, a serious charge merits any of the following sanctions:

1. Dismissal from the service, forfeiture of all or part of the benefits as the Court may determine, and disqualification from reinstatement or appointment to any public office, including government-owned or controlled corporations; provided, however, that the forfeiture of benefits shall in no case include accrued leave credits;

2. Suspension from office without salary and other benefits for more than three (3), but not exceeding six (6), months; or

3. A fine of more than P20,000.00, but not exceeding P40,000.00.

On the other hand, conduct unbecoming of a judge is classified as a light offense under Section 10, Rule 140 of the Rules of Court. It is penalized under Section 11(C) thereof by any of the following: (1) A fine of not less than P1,000.00 but not exceeding P10,000.00; (2) Censure; (3) Reprimand; and ( 4) Admonition with warning.

Judge Austria's record shows that she had never been administratively charged or found liable for any wrongdoing in the past. Since this is her first offense, the Court finds it fair and proper to temper the penalty for her offenses.

WHEREFORE, the Court finds Judge Ma. Cecilia I. Austria guilty of GROSS IGNORANCE OF THE LAW for which she is FINED Twenty-One Thousand Pesos (P21,000,00). Judge Austria is likewise hereby ADMONISHED to refrain from further acts of IMPROPRIETY and to refrain from CONDUCT UNBECOMING OF A JUDGE, with the STERN WARNING that a repetition of the same or similar acts shall be dealt with more severely.

SO ORDERED.

A.C. No. 9881 June 4, 2014

(Formerly CBD 10-2607)

ATTY. ALAN F. PAGUIA, Petitioner,

vs.

ATTY. MANUEL T. MOLINA, Respondent.

R E S O L U T I O N

SERENO, CJ:

For resolution by this Court is the dismissal by the Integrated Bar of the Philippines (IBP) Board of Governors of the administrative Complaint for DISHONESTY against respondent, Atty. Manuel Molina. Atty. Molina allegedly advised his clients to enforce a contract on the complainant's client who had never been a party to the agreement.

The facts are as follows:

The case involves a conflict between neighbors in a four-unit compound named "Times Square" at Times Street, Quezon City. The neighbors are the following: 1) Mr. And Mrs. Gregorio M. Abreu, clients of Atty. Paguia; 2) Mr. And Mrs. Wilson Lim, clients of respondent Molina; 3) Dr. and Mrs. Eduardo Yap; and Dr. Belinda San Juan.

The clients of Atty. Molina entered into a contract with the other unit owners save for Mr. Abreu. The agreement, covered by a document titled "Times Square Preamble," establishes a set of internal rules for the neighbors on matters such as the use of the common right of way to the exit gate, assignment of parking areas, and security. Mr. Abreu, the client of complainant, Atty. Paguia, was not a party to the contract since the former did not agree with the terms concerning the parking arrangements.

On 4 February 2010, Atty. Paguia filed a Complaint for Dishonesty1 with the IBP Commission on Bar Discipline against Atty. Molina2 for allegedly giving legal advice to the latter’s clients to the effect that the Times Square Preamble was binding on Mr. Abreu, who was never a party to the contract.

In his Answer,3 Atty. Molina downplayed the case as a petty quarrel among neighbors. He maintained that the Times Square Preamble4 was entered into for purposes of maintaining order in the residential compound. All homeowners, except Mr. Abreu, signed the document.5

Respondent further stated in his Answer that Mr. and Mrs. Gregorio Abreu filed two cases against his clients, Mr. And Mrs. William Lim, on the belief that Mr. Abreu was not bound by the Times Square Preamble. The first case, was filed with the Housing and Land Use Regulatory Board (HLURB), which was an action to declare the Times Square Preamble invalid. The second suit was an action for declaratory relief. Both cases, according to respondent, were dismissed.6

Respondent further claimed that another case had been filed in court, this time by his client, the Lims. They were prompted to file a suit since Mr. Abreu had allegedly taken matters into his own hands by placing two vehicles directly in front of the gate of the Lims, thus blocking the latter’s egress to Times Street. The Lims filed with the Regional Trial Court, Branch 96, Quezon City, a Complaint for Injunction and Damages, coupled with a prayer for the immediate issuance of a Temporary Restraining Order and/or Preliminary Injunction, which was docketed as Civil Case No. Q-08-63579. According to respondent, the RTC granted the relief prayed for in an Order dated 12 December 2008.7

Atty. Molina concluded that the above facts sufficiently served as his answer to the Complaint.

On 3 August 2010, Investigating Commissioner Victor C. Fernandez rendered a Report and Recommendation. He recommended dismissal for lack of merit, based on the following grounds: 1) the complaint consisted only of bare allegations; and 2) even assuming that respondent Molina gave an erroneous legal advice, he could not be held accountable in the absence of proof of malice or bad faith.8

On 14 May 2011, the IBP Board of Governors passed Resolution No. XIX-2011-210, adopting and approving the Report and Recommendation of the Investigating Commissioner.9

Atty. Paguia filed a Motion for Reconsideration dated 2 August 2011, but was denied by the IBP Board of Governors on 29 December 2012.10 Notices of the denial were received by the parties on 21 March 2013.11

No petition for review has been filed with this Court.

It is worth noting that a case is deemed terminated if the complainant does not file a petition with the Supreme Court within fifteen (15) days from notice of the Board’s resolution. This rule is derived from Section 12(c) of Rule 139-B, which states:

(c) If the respondent is exonerated by the Board or the disciplinary sanction imposed by it is less than suspension or disbarment (such as admonition, reprimand, or fine) it shall issue a decision exonerating respondent or imposing such sanction. The case shall be deemed terminated unless upon petition of the complainant or other interested party filed with the Supreme Court within fifteen (15) days from notice of the Board’s resolution, the Supreme Court orders otherwise. (Underscoring supplied)

In this case, Atty. Paguia received notice of the Board’s resolution on 21 March 2013, as evidenced by a registry return receipt. To this date, this Court has yet to receive a petition for review from Atty. Paguia. Thus, for his failure to file a petition for review with the Court within 15 days, this case is deemed terminated pursuant to the above mentioned Section 12(c).

Nevertheless, we have gone over the records but we have no reason to deviate from the findings of the IBP Board of Governors.

When it comes to administrative cases against lawyers, two things are to be considered: quantum of proof, which requires clearly preponderant evidence; and burden of proof, which is on the complainant.12

In the present case, we find that the Complaint is without factual basis. Complainant Atty. Paguia charges Atty. Molina with providing legal advice to the latter’s clients to the effect that the Times Square Preamble is binding on complainant’s client, Mr. Abreu, who was not a signatory to the agreement. The allegation of giving legal advice, however, was not substantiated in this case, either in the complaint or in the corresponding hearings. Nowhere do the records state that Atty. Paguia saw respondent giving the legal advice to the clients of the latter. Bare allegations are not proof.13

Even if we assume that Atty. Molina did provide his clients legal advice, he still cannot be held administratively liable without any showing that his act was attended with bad faith or malice. The rule on mistakes committed by lawyers in the exercise of their profession is as follows:

An attorney-at-law is not expected to know all the law. For an honest mistake or error, an attorney is not liable. Chief Justice Abbott said that, no attorney is bound to know all the law; God forbid that it should be imagined that an attorney or a counsel, or even a judge, is bound to know all the law. x x x.14

The default rule is presumption of good faith. On the other hand, bad faith is never presumed.1âwphi1 It is a conclusion to be drawn from facts. Its determination is thus a question of fact and is evidentiary.15 There is no evidence, though, to show that the legal advice, assuming it was indeed given, was coupled with bad faith, malice, or ill-will. The presumption of good faith, therefore, stands in this case.

The foregoing considered, complainant failed to prove his case by clear preponderance of evidence.

WHEREFORE, the Resolution of the IBP Board of Governors adopting and approving the Decision of the Investigating Commissioner is hereby AFFIRMED.

SO ORDERED.