CANON 16: A LAWYER SHALL HOLD IN TRUST ALL MONEYS AND PORPERTIES OF HIS CLIENT THAT MAY COME INTO HIS POSSESSION

- All the moneys collected by an attorney for his client belongs to the client

- A lawyer is under obligation to hold in trust all the moneys and properties of his client that may come to his possession

AYA VS. BIGORNIA

FACTS:

Dominga Aya filed a complaint against atty. Juan Bigornia his counsel, charging that the latter misappropriated the funds belonging to her.It happened when Bigornia, as Aya's attorney, obtained judgment in Aya's favor against Dionisio Cuntapay, for the sum of P1,000 plus interest and costs. Bigornia admits receiving all of the money collected on this judgment. In his answer to the Attorney-General's report, he admits that there was unreasonable delay on his part in accounting for the funds collected by him for his former client. But defendant contended that Aya agreed that bigornia might collect and use the money in tha nature of a loan from aya. However the court held that there is no evidence that will sustain the defense. On the other hand, the complainant was constantly demanding payment of the money Bigornia had collected

HELD:

Attorney Bigornia was guilty of breach of trust and misappropriation of funds at the time he collected the sums of money aforesaid on the judgment in favor of his client, and appropriated them to his own use. Moneys collected by an attorney on a judgment in favor of his client are trust funds and should be immediately paid over to the client, less such proper deductions as may be allowed by law. In this case, there was gross abuse of such trust.

THUS, it is clear that there was unreasonable delay on the part of the respondent in accounting funds collected by him for his former client, the complainant herein, for which irregularity the respondent herein should be disciplined.

A lawyer has dual role to the clients.

1. FIDUCIARY OR TRUSTEE - there must be utmost good faith and fidelity to the client. The client does not only entrust his case to his lawyers but also entrust to his lawyers the safekeeping of his very important documents/funds.

2. AGENT - As agent of the client, the lawyer may appear in court in behalf of the client, and as such, the lawyer binds the client in matters of ordinary procedure. The client is the principal and the lawyer is the agent.

LICUANAN VS. MELO

FACTS:

Leonila J. Licuanan filed a complaint against respondent, Atty. Manuel L. Melo, for breach of professional ethics, alleging that respondent, who was her counsel in an ejectment case filed against her tenant , aida pineda, failed to remit to her the rentals collected by respondent on different dates over a twelve-month period, much less did he report to her the receipt of said amounts. Defendant explained that he kept this matter from the complainant for the purpose of surprising her with his success in collecting the rentals. During the entire twelve-month period that respondent had been receiving the said rental payments of Pineda, he did not bother to inform or report to complainant about the said payments and instead unnecessarily retained the money. He allowed the money to accumulate for a year and He did not even attempt to tell her about the money that had come into his possession notwithstanding the fact that complainant used to call him and inquire regarding the case 

HELD:

Money of the client or other trust property coming into the possession of the lawyer should be reported promptly. Melo violated his oath of office in which a lawyer, under his oath, pledges himself not to delay any man for money or malice and is bound to conduct himself with all good fidelity to his clients. Under paragraph 11 of the Canons of Legal Ethics, he is obligated to report promptly the money of client that has come to his possession and should not commingle it with his private property or use it for his personal purpose without his client's consent.

CANON 16.01: A LAWYER SHALL ACCOUNT FOR ALL MONEY OR PROPERTY COLLECTED OR RECEIVED FOR OR FROM THE CLIENT

LAWYER IS ACCOUNTABLE FOR ALL MONEYS AND PROPERTIES OF CLIENT - Considering that the lawyer is merely holding in trust the moneys and properties he received for his client, he is accountable therefor to his client.

- In order for the client to promptly account for all the funds received or held by him, he should maintain adequate records of the client’s moneys or properties in his custody

Rule 138, section 25, rules of court

“When an attorney unjustly retains in his hands money of his client after it has been demanded, he may be punished for contempt as an officer of the Court who has misbehaved in his official transactions; but proceedings under this section shall not be a bar to a criminal prosecution.”

A lawyer who fails to account his client’s money or return the same may be disciplined, which may range from suspension to disbarment depending on the surrounding circumstances.

BUSIOS VS. RICAFORT

In a civil case for collection of rental fees for the lease of the real property of complainant by oas standard highschool, complainant authorizes Atty. Ricafort to withdraw from its bank account, 32,000 representing the rental fees paid by the school with the instruction to deposit the same in her savings account at the PNB. When She demanded from him to give her the money, he informed her that he had already spent the same. He promised, though to pay her the said amount. Despite several demands, respondent failed to make good his promise to give her the money he withdrew

In a sworn complaint for disbarment, complainant Lourdes R. Busios charged respondent Atty. Francisco Ricafort, with having committed the crime of estafa under Article 315 (1)

(b) of the Revised Penal Code by misappropriating the sum of P32,000.00. Of this amount,P30,000.00 was entrusted to respondent for deposit in the bank account of complainants husband, while P2,000.00 represented the amount respondent demanded from complainant supposedly for a bond in Civil Case No. 5814, when no such bond was required.

HELD:

Respondent, by converting the money of his clients to his own personal use without their consent , and by deceiving the complainant into giving him the amount of P2,000.00 purportedly to be used as a bond which was not required, is, undoubtedly, guilty of deceit, malpractice and gross misconduct. By so doing, he betrays the confidence reposed in him by his clients. Not only has he degraded himself but as an unfaithful lawyer he has besmirched the fair name of an honorable profession.

The IBP’s recommendation of suspending the respondent is insufficient. In which case the Court resolves to disbar the respondent applying section 25, rule 138.