206883782 lawyers-fiduciary-obligations

Get
Homework/Assignm
ent Done
Homeworkping.
com
Homework Help
https://www.homeworkping.com/
Research Paper help
Online Tutoring
click here for freelancing tutoring
sites
X. LAWYER’ S FIDUCIARY OBLIGATIONS
A. EFFECTS OF FIDUCIARY RELATION
[A.C. No. 5019. April 6, 2000]
Judge ADORACION G. ANGELES, complainant, vs. Atty.
THOMAS C. UY JR., respondent.
D E C I S I O N
PANGANIBAN, J.:
Lawyers must promptly account for money or property they
receive on behalf of their clients. Failure to do so constitutes
professional Misconduct and justifies the imposition of
disciplinary sanctions.
The Case and the Facts
In a letter dated February 11, 1999 addressed to the Office of
the Chief Justice, Judge Adoracion G. Angeles of the Regional
Trial Court of Caloocan City (Branch 121) charged Atty.
Thomas C. Uy Jr. with violation of Canon 16 of the Code of
Professional Responsibility. Complainant states that
respondent's acts, which had earlier been held contemptible in
her February 10, 1999 Order,[1]
also rendered him
administratively liable. In the said Order, she narrated the
following facts:
"When the case was called for the second time at 11 :25
o'clock in the morning, the private prosecutor Atty.
Thomas C. Uy, Jr. appeared. In open court, accused
Norma Trajano manifested that she had already settled in
full the civil aspect in Crim. Case No. C-54177 (98) in
the total amount of [t]hirty [s]ix [t]housand [f]ive
[h]undred (P36,500.00) [p]esos. She further alleged that
she paid P20,000.00 directly to the private complainant
and the balance of P16,500.00 was delivered to Atty.
Thomas C. Uy, Jr., the lawyer of the private complainant
and accordingly produced in open court the receipt for
such payment signed by no less than the aforesaid
lawyer. Indeed, the civil liability of the accused had
already been satisfied in full. Miso
"However, the private complainant, Primitiva Malansing
[Del Rosario] manifested that she did not receive the
amount of [s]ixteen [t]housand [f]ive [h]undred
(P16,500.00) [p]esos which was paid to his lawyer Atty.
Thomas C. Uy, Jr., thereby constraining this court to
direct Atty. Thomas C. Uy to turn over the money to the
private complainant which he received in trust for his
client. Atty. Uy however argued that his client did not
like to accept the money but the assertion of the lawyer
was belied by his own client, the herein private
complainant, who manifested in open court x x x her
willingness to accept the money. The Court again
directed Atty. Uy to produce the money but the latter
argued that he kept it in his office. Consequently, the
Court suspended the proceedings to enable Atty. Uy to
get the money from his law office which is located only
at the second floor of the same building where this court
is located.
"Unfortunately, it is already 12: 15 o'clock past noon but
Atty. Uy did not show up anymore and not even his
shadow appeared in Court.
"It cannot be denied that the act of Atty. Thomas Uy in
deliberately failing to return to the Court [the]
proceedings [of which] were suspended just because of
his representations, mirrors not only an undisguised
disobedience of a court order but also manifests his
1

propensity to mock the dignity of the Court.
Disgustingly, he deliberately ignored his solemn oath to
conduct himself as befitting the status of an officer of the
court.
"Indeed, this gross misbehavior of Atty. Uy cannot
simply be ignored for it is a raw challenge to the
authority of the Court.
"It must also be pointedly emphasized that Atty. Thomas
Uy committed a brazen violation of the provisions of
Canon 16 of the Code of Professional Responsibility, to
wit: Nexâ old
"x x x x x x x x x
"Obviously, Atty. Thomas Uy fell short of the duties
expected from him as a member of the bar."
In compliance with this Court's March 24, 1999
Resolution, Respondent Uy[2]
filed his Comment on June
7, 1999. Denying that he violated Canon 16 of the Code
of Professional Responsibility, he explained:
"1). In a criminal case, then pending before the Regional
Trial Court, Branch 121 of Kalookan City, Metro
Manila, presided by the complainant Honorable
Adoracion G. Angeles, entitled 'People of the Philippines
vs. Norma Trajano, et., al', Criminal Case No. C-54176-
77 (98), Atty. Thomas C. Uy Jr., herein referred to as
[r]espondent, was engaged as [p]rivate [p]rosecutor of
the complainant therein, Mrs. Primitiva Malansin Del
Rosario. At the outset Norma Trajano, accused in said
criminal case, expressed her desire and offered to settle
the civil aspect of the criminal case against her to which
Primitiva Del Rosario acceded. On separate hearings,
Norma Trajano made installment payments to Primitiva
Del Rosario some of which payments were duly
acknowledged by the latter in the presence of
[r]espondent;
"2). On a previously cancelled date of hearing of the
aforesaid criminal case x x x on December 14, 1998,
Norma Trajano went to the office of the [r]espondent at
about 8:45 o'clock in the morning, x x x and met Mr.
Romeo C. Jamisola Jr., who is acting as [r]espondent's
personal secretary and at the same time the liason officer
of the law firm De Veyra, Uy and Associates x x x. Mr[.]
Romeo Jamisola Jr., is the lone staff of the law firm x x
x. Respondent was at that time not in the office as he
was attending a hearing before the Regional Trial Court,
Branch 122, Kalookan City, Metro Manila. x x xManiâ
kx
"3). On the aforesaid date and time (December 14, 1998)
at the office of the [r]espondent, Norma Trajano told Mr.
Romeo Jamisola Jr. that she will make another partial
payment to Primitiva M. Del Rosario because she cannot
attend the hearing the following day (8[:]30 o'clock a.m.
of December 15, 1999) before Judge Adoracion G.
Angeles due to a conflict of schedule with her [other]
case in the Regional Trial Court, Branch 19, Malolos,
Bulacan, where she is likewise the accused for [e]stafa[.]
Mr. Romeo Jamisola told Norma Trajano to wait for a
while as he will fetch [r]espondent at the ground floor in
the sala of the Honorable Remigio E. Zari. Respondent,
upon being informed of the presence of Norma Trajano
in the office of the [r]espondent by Romeo Jamisola Jr.
went to his office and Norma Trajano immediately told
[r]espondent that she knew that the setting for that day
(December 14, 1998) was previously cancelled and that
she cannot attend the hearing the following day (8[:]30
o'clock a.m. December 15, 1998) and further told the
[r]espondent that she (Norma Trajano) will make another
partial payment to Primitiva M. Del Rosario and that she
will just leave her payment in the sum of [s]ixteen
[t]housand [five hundred] [p]esos (P16,500.00),
Philippine [c]urrency, in the office of the [r]espondent.
Respondent then told Norma Trajano to inform Primitiva
M. Del Rosario first but Norma Trajano replied that she
will just call Primitiva [Del Rosario]. Nonetheless,
[r]espondent told Romeo Jamisola Jr. to call Primitiva
Del Rosario, using the office phone, and let her talk with
Norma Trajano, and, if Primitiva Del Rosario agreed
[r]espondent instructed Romeo Jamisola Jr., to just
prepare a receipt. Respondent, fearing that his case
(People vs. Rommel Senadrin et al. above-stated) might
have been called in the calendar, immediately left the
office and proceeded [at] the sala of the Honorable
Remigio E. Zari. Respondent, after the hearing x x x,
returned to his office and upon learning that his signature
was affixed by Romeo Jamisola Jr. upon the insistence
of Norma Trajano scolded Romeo Jamisola Jr. and for
his unsuccessful attempt to contact first Primitiva Del
Rosario before receiving the sum of money left by
Norma Trajano; Maniksâ
"4). The following day [o]n the morning of December
15, 1998 [r]espondent arrived at his office and met
Primitiva Del Rosario and her daughter Aurora Del
Rosario and immediately the trio appeared before the
sala of Judge Adoracion G. Angeles in the hearing of the
Norma Trajano case. Returning [to] the office of the
[r]espondent after the hearing, Primitiva Del Rosario and
Aurora Del Rosario, being earlier informed that on
December 14, 1998 Norma Trajano went [to] his office
and made partial payment in the sum of P16,500 thru
Mr. Romeo Jamisola Jr., the [r]espondent told Mr.
Romeo Jamisola to get the money from the filing cabinet
and while the money in the envelope [was] being handed
over to Primitiva Del Rosario, [the latter] and her
daughter x x x, however, told [r]espondent to just let the
money in the sum of P16,500.00 be kept at the office of
the [r]espondent so that future payments of Norma
Trajano will be save[d] in whole and for them to avoid
spending the same as what had happened to the past
installment payments of Norma Trajano.Respondent then
acceded to the request of Primitiva Del Rosario and her
daughter and told them that they can get the money
anytime they want from the [r]espondent's office. Hence,
the money was kept locked [in] the filing cabinet of the
[r]espondent where he used to keep all his personal
file[s]. Manikanä
2

"5). On December 23, 1998, early before noon, Primitiva
Del Rosario and her daughter Aurora Del Rosario, on a
prior invitation, attended the Christmas Party of the
office of [r]espondent and undersigned counsel. x x x
Respondent, after the x x x lunch, instructed Mr. Romeo
Jamisola Jr., to give the sum of money (P16,500.00) and
for Primitiva Del Rosario to receive the same for fear of
a repetition of a burglary incident before, where some
cash and minor office appliances of undersigned were
lost. Primitiva Del Rosario, however, insisted that said
sum of money be kept at the office of the [r]espondent to
save in whole the installment payments of Norma
Trajano and that [was] the wish of her son Fernando
'Bong' Del Rosario, who is a long time friend and a
compadre of the [r]espondent. Respondent, respecting
the trust reposed upon him by Primitiva Del Rosario, her
daughter Aurora Del Rosario, and son Fernando Del
Rosario, acceded to hold in trust the said sum of
[s]ixteen [t]housand [f]ive [h]undred (P16,500.00)
[p]esos, Philippine [c]urrency, which [was] locked and
safely kept [in] the filing cabinet of the [r]espondent
until February 12, 1999; x x x;
"6). On February 10, 1999 [during] the hearing of the
Norma Trajano case before the Hon. Adoracion G.
Angeles, [r]espondent appeared shortly before 10:30
o'clock in the morning, pursuant to a 'Motion to Call Case
at 10:30 o'clock in the Morning’ x x x.
"7). When the said Norma Trajano [case] x x x was called
on second call at 11[:]25 a.m., [i]n said February 10, 1999
hearing, respondent was first scolded by the Honorable
Court (Judge Adoracion G. Angeles) x x x [for] giving
more preference to the Metropolitan Trial Court than her
Court. Resp[o]ndent, however, beg[ged the] indulgence of
the Honorable Court (Judge Adoracion G. Angeles) and
explained why [he] first attend[ed] the Mandaluyong
hearing of Manny Chua's case, to wit; x x x. Oldmisâ o
"8). That it was during the course of [the] litany of
sermon, [i]n that hour, made by the Honorable Court
addressed to the [r]espondent that Norma Trajano x x x
butted in and informed the Honorable Court (Judge
Adoracion G. Angeles) that she will be tendering another
partial payment; it was at that moment that Judge
Adoracion G. Angeles asked Norma Trajano how much
had she paid Primitiva Del Rosario, and, Norma [T]rajano
answered that she had already paid P36,500.00 as full
payment for one case, and that of the P36,500, P20,000.00
was paid to Primitiva Del Rosario and HESITANTLY
said that the P16,500 was paid to the [r]espondent. Judge
Angeles then took the receipt from Norma Trajano and
had it xeroxed by a personnel of the Court. The carbon
duplicate original of the Receipt, dated [D]ecember 14,
1998, showing the receipt by the office of the
[r]espondent, through Romeo Jamisola Jr., whose printed
[name] was pre[ceded] by the word 'By', indicating that
he received the sum of money on behalf of or in
representation of the [r]espondent, is hereto [attached] and
marked as ANNEX '5', to form part hereof;
"9). That it was perhaps due to the belief [in] and the
immediate impression of Judge Adoracion G. Angeles [of
the] answer of Norma Traiano that prompted Judge
Angeles to ask, instantaneously in a loud manner,
Primitiva Del Rosario ‘IN TAGALOG', the question,
'NATANGGAP MO BA KAY ATTY. UY ANG PERA
NA P16,500.00?'. Primitiva Del Rosario, a seventy-year-
old, who was shocked by the tone and the manner she was
asked by Judge Angeles simply just answered 'HINDI PO,
KASI GUSTO [KO] PO NA MABUO ANG PERA'.
Primitiva Del Rosario, however, tried to explain her
answer 'HINDI PO' and why she did not yet [receive] the
money from the [r]espondent by raising her hand but was
prevented by Judge Adoracion G. Angeles from further
answering by telling Primitiva Del Rosario to stop. With
that answer of Primitiva Del Rosario, [r]espondent butted
in to explain Primitiva Del Rosario's answer of 'HINDI
PO' and her having not yet received the sum of money,
subject of the inquisition of Judge Angeles by manifesting
to wit; x x x that Primitiva Del Rosario did not get the
money when x x x handed the same on December 15,
1998 because she wanted [it] to be save[d] in whole
together with the future installment payments of Norma
Trajano and to be kept in the office of the [r]espondent as
wished by her son Bong Del Rosario; and, that the said
sum of money [was] kept in the filing cabinet in the office
of the [r]espondent. All explanation[s] of the [r]espondent
went to x x x naught as the [r]espondent was cut short by
x x x Judge Angeles, [who] in a loud and angry voice
orally directed the [r]espondent to get the money from
[r]espondent's office and give the same to Primitiva Del
Rosario. It was already 11 :45 o'clock in the morning,
more or less, an the [r]espondent was given fifteen (15)
minutes to comply; [r]espondent requested Judge Angeles
to be accompanied by Primitiva Del Rosario and her
daughter Aurora Del Rosario but both were ordered to
stay in court by Judge Angeles; Ncmâ
"10). Respondent in compliance with the oral order of
Judge Angeles immediately proceeded [to] his office but
only to find out that Romeo Jamisola Jr., who [held] the
only key [to r]esponddnt's filing cabinet, was on errand x
x x that morning of February 10, 1999 [for] Atty. Angel
B. De Veyra (the Undersigned Counsel) [who had sent
him] to the offices of the solicitor general in Makati City,
and, the City Prosecutor's Office of Manila to [furnish
copies to] both offices; x x x;
"11). Respondent, expecting that Romeo Jamisola Jr.
would [arrive] before 12[:]00 noon, x x x waited for
Romeo Jamisola Jr. while at the same time called up [his]
wife to immediately [come] to his office to spare the sum
of P16,500.00 as Romeo Ja[mi]sola may not [arrive]
[within] the time allotted by Judge Angeles. The wife of
respondent, however, arrived at about 12:25 P .M., more
or less, ahead of Romeo Jamisola Jr. and spared
[r]espondent the sum of P16,500.00 and [r]espondent
immediately went [to] the fourth floor, where the sala of
Judge Angeles [was] located but unfortunately the session
was already adjourned. Respondent then talked to
'Armand', one 'of the court personnel and is known as the
door keeper of the chamber of Judge Angeles, and
3

[requested that he be allowed to go inside the chamber to
show [his] compliance, though late. Respondent,
however, was told by 'Armand' that Judge Angeles was on
her lunch break an that it [was] better for [r]espondent to
take his lunch too and return a little later; NcmmisÓ
"12). At about 1:30 o'clock in the afternoon of that day
(February 10, 1999) [r]espondent returned [to] the sala of
Judge Angeles together with Primitiva Del Rosario and
her daughter Aurora Del Rosario, who likewise returned
to the court, to seek an audience in [the] chamber [of]
Judge Angeles. Said audience with Judge Angeles was
desired by Primitiva Del Rosario to let Judge Angeles
[witness] the giving of the money to Primitiva Del
Rosario. But request[s] for the same, through 'Armand',
were twice denied by Judge Angeles because at that time
Judge Angeles was being interviewed by several media
personnel of some TV stations. The Del [Rosarios],
however, left earlier upon knowing that Judge Angeles
denied their request for an audience. [They] told
[r]espondent that they will be back the following day. It
was only when Romeo Jamisola arrived at about 3:00
o'clock, more or less, in the afternoon and went at the
fourth floor at the premises of the sala of Judge Angeles
and informed the [r]espondent that he carried with him
the key to [r]espondent's cabinet and the presence of some
[squatter] families of Batasan Hills, Quezon City at the
office of the [r]espondent, who has an appointment with
the [r]espondent, that the [r]espondent left the premises of
the sala of Judge Angeles. [sic] Respondent, at his office
ordered Romeo Jamisola Jr. to open the filing cabinet and
returned to the premises of the sala of Judge Angeles
alone at about 4:00 o'clock P .M. after his meeting with
the squatter families. But again, his request to 'Armand' to
talk with Judge Angeles, after the media interview, was
denied. At about 5:30 o'clock in the afternoon, 'Armand',
the court personnel, served the Order, of said date,
February 10, 1999 at the office of the [r]espondent;
"13). In the early afternoon of the following day, February
11, 1999, [r]espondent together with Primitiva Del
Rosario and her daughter Aurora Del Rosario went again
[to] the sala of Judge Angeles x x x to seek an audience
with Judge Angeles. Their request x x x w[as] likewise in
vain. Primitiva Del Rosario, after the last attempt to seek
audience with Judge Angeles and already tired of going
[to] and [from] the sala of Judge Angeles, decided on
February 12, 1999, to receive the sum of money in the
amount of P16,500.00 from the office of the [r]espondent,
through, Romeo Jamisola Jr. and executed a Sinumpaang
Salaysay. x x x;
"14). The Sinumpaang Salaysay of Primitiva Del Rosario,
dated February 16, 1999 as well as the Acknowledgment
Receipt, dated February 12, 199[9] was attached to a
Manifestation caused to be filed by the [r]espondent on
March 3, 1999 when the respondent was confined in
Fatima Hospital in Valenzuela City, Metro Manila on
March 2, 1999;Scncä m
"15). Learning of the instant administrative case against
the [r]espondent, Bong Del Rosario, the son of Primitiva
Del Rosario, upon whose wish the subject sum of money
was kept at the office of the [r]espondent to save the same
in whole as well as the future in[s]tallment payments of
Norma Trajano executed a Sinumpaang Salaysay,
attesting [to] and confirming the statement of [his] mother
Primitiva Del Rosario. x x x"[3]
Stripped of unnecessary verbiage, the Comment contends that
the respondent kept the money in his office because that was
the alleged wish of both his client and her son. He allegedly
informed them of such money and tried to give it to them, but
they insisted that he retain it. He further maintained that it was
only after Judge Angeles issue the February 10, 1999 Order
that his client relented and accepted the money on February
12, 1999.
After the judge filed her Reply on June 30, 1999, this Court
referred the case to the Office of the Bar Confidant for report
and recommendation. The Court dispensed with the normal
referral to the Integrated Bar of the Philippines because the
records were complete and the question raised was simple. No
further factual investigation was necessary in the premises.
Bar Confidant's Report and Recommendation
Recommending that Atty. Thomas C. Uy Jr .be suspended
from the practice of law for one month, the Office of the Bar
Confidant in its Report and Recommendation dated December
15, 1999 said: SdaaÓ miso
"x x x [I]t is clear that it is the sworn duty of a member of
the bar to be accountable, at all times, for anything which
he receives for and in behalf of his client.
"In the case at bar, this Office is more inclined to believe
the story of the complainant.
"First, it cannot be disputed that the transcript of
stenographic notes is the most reliable record of what
indeed transpired (and what words were uttered by the
parties involved) on February 10, 1999 at the hearing of
Crim. Case No. C-54176-77 (98). Records clearly show
that the private complainant in the criminal case, when
asked by Judge Angeles as to the whereabouts of the
P16,500.00, spontaneously replied that she had no
knowledge of the same; in effect saying that Atty. Uy has
not given her the subject 16,500.00. If, indeed, Primitiva
Del Rosario requested Atty. Uy to keep the money as far
back as December 1998, then she should have told the
same to Judge Angeles.
"Atty. Uy's allegation that Judge Angeles prevented
Primitiva Del Rosario from saying in open court the
words 'HINDI PO KASI GUSTO KO PO NA MABUO
ANG PERA' does not have any proof as nothing of that
sort appears in the transcript of stenographic notes. Atty.
Uy has not even bothered to refute the truth of the
contents of the stenographic notes, all the more bolstering
this Office's opinion that the said notes are accurate and
truthful. Sdaad
4

"Second, the affidavits executed by Primitiva Del Rosario
and her son, Fernando Del Rosario, dated February 16,
1999 and June 7, 1999, respectively, attesting to Atty.
Uy's averment that his act of personally keeping the
subject P16,500.00 was with and at their request cannot
be given much credence to outweigh the arguments of
Judge Angeles. The said affidavits, both executed after
February 10, 1999, are suspect. Caught by surprise when
Judge Angeles inquired of the whereabouts of his client's
money, Atty. Uy x x x resorted to seeking the help of his
client to corroborate his defense. Being the clients of
Atty. Uy, Primitiva Del Rosario and her son could have
been persuaded to help extricate their counsel from the
latter's predicament.
"In the absence of any contradicting evidence to dispute
the allegation that Atty. Uy failed to immediately remit to
his client the money due the latter, it is safe to conclude
that Atty. Uy has violated his sworn duty to uphold, at all
times, the trust and confidence reposed in him by his
client(s).
x x x x x x x x x
"In the instant case, Atty. Uy, upon receipt of the
P16,500.00 from the accused in the criminal case, should
have promptly remitted the same to his client, Primitiva
Del Rosario. Had Judge Angeles not inquired of the
whereabouts of the money, the same would have
remained with Atty. Uy, to the prejudice of the latter's
client."[4]
This Court's Ruling
We agree with the findings and the recommendation of the
Office of the Bar Confidant. Scsä daad
Administrative Liability of Respondent
The relationship between a lawyer and a client is highly
fiduciary; it requires a high degree of fidelity and good faith. It
is designed "to remove all such temptation and to prevent
everything of that kind from being done for the protection of
the client."[5]
Thus, Canon 16 of the Code of Professional Responsibility
provides that "a lawyer shall hold in trust all moneys and
properties of his client that may come into his possession."
Furthermore, Rule 16.01 of the Code also states that "a lawyer
shall account for all money or property collected or received
for or from the client." The Canons of Professional Ethics is
even more explicit:
"The lawyer should refrain from any action whereby for
his personal benefit or gain he abuses or takes advantage
of the confidence reposed in him by his client. SupÓ rema
"Money of the client collected for the client or other trust
property coming into the possession of the lawyer should
be reported and accounted for promptly and should not
under any circumstances be commingled with his own or
be used by him."[6]
In the present case, it is clear that respondent failed
to promptly report and account for the P16,500 he had
received from Norma Trajano on behalf of his client, Primitiva
Del Rosario. Although the amount had been entrusted to
respondent on December 14, 1998, his client revealed during
the February 10, 1999 hearing that she had not yet received it.
Worse, she did not even know where it was.
Respondent maintains that on December 15, 1998 he informed
Mrs. Del Rosario about the payment. He further avers that he
kept the money up n her instruction, as she had allegedly
wanted "future payments x x [to] be saved in whole and for
them to avoid spending the same as what had happened to the
past installment payments x x x."[7]
This assertion allegedly
finds support in her answer to the question of Judge Angeles,
who had asked her whether she had received the disputed
payment: "Hindi po, kasi gusto [ko] po na mabuo ang pera."
The Court is not persuaded. Respondent's assertions are
contradicted by the following transcript of stenographic notes:
"Court: This P16,500, did you turn it over to the
private complainant?
Atty. Uy: No your Honor, because she wanted the
full amount of the settlement.
Court: Private complainant, is it true that you did
not want to accept the money?
Mrs. Del Rosario: Hindi po, sila po ang
nagbigayan. Jurisä
Court: Hindi po ibinibigay sa inyo ni Atty. Uy?
Mrs. Del Rosario: Hindi po.
x x x x x x x x x
Court: Nasaan iyong P16,500? Huwag kayong
matakot.
Mrs. Del Rosario: Aywan ko po sa kanilang
dalawa."[8]
If it were true that Mrs. Del Rosario was informed about the
payment and that she entrusted it to respondent, she would
have known its whereabouts. That she did not know it showed
the falsity of his claim.
It is noteworthy that respondent did not dispute the foregoing
transcript although it belied his allegation that Mrs. Del
Rosario's express wish was to have the payments in full. Scä
juris
Neither are we convinced by the affidavits of Mrs. Del
Rosario and her son, both of whom affirmed their intention to
have their money in the safekeeping of respondent. It should
be stressed that he was her counsel and the compadre of her
son. Moreover, the affidavits were executed after the filing of
this Complaint. As the Office of the Bar Confidant observed,
these considerations militate against the credibility of the
affiants. In any event, their affidavits fail to explain adequately
why Mrs. Del Rosario, during the hearing on February 10,
1999, did not know where her money was.
5

The records do not clearly show whether Attorney Uy had in
fact appropriated the said amount; in fact, Mrs, Del Rosario
acknowledge that she had received it on February 12, 1999.
They do show, however, that respondent failed to promptly
report that amount to her. This is clearly a violation of his
professional responsibility. Indeed, in Aya v. Bigornia,[9]
the
Court ruled that money collected by a lawyer in favor of his
clients must be immediately turned over to them. In Daroy v.
Legaspi,[10]
the Court held that "lawyers are bound to promptly
account for money or property received by them on behalf of
their clients and failure to do so constitutes professional
misconduct."
Verily, the question is not necessarily whether the rights of the
clients have been prejudiced, but whether the lawyer has
adhered to the ethical standards of the bar.[11]
In this case,
respondent has not done so. Indeed, we agree with the
following observation of the Office of the Bar Confidant:
"Keeping the money in his possession without his client's
knowledge only provided Atty. Uy the tempting
opportunity to appropriate for himself the money
belonging to his client. This situation should, at all times,
be avoided by members of the bar. Like judges, lawyers
must not only be clean; they must also appear clean. This
way, the people's faith in the justice system would remain
undisturbed."[12]
Jurisä sc
In this light, the Court must stress that it has the duty to look
into dealings between attorneys and their clients and to guard
the latter from any undue consequences resulting from a
situation in which they may stand unequal.[13]
The present
situation calls for the exercise of this duty.
For misappropriating and failing to promptly report and
deliver money they received on behalf of their clients, some
lawyers have been disbarred[14]
and others have been
suspended for six months.[15]
In the present case, the records
merely show that respondent did not promptly report that he
received money on behalf of his client. There is no clear
evidence of misappropriation. Under the circumstances, we
rule that he should be suspended for one month.
WHEREFORE, Atty. Thomas C. Uy Jr .is
hereby SUSPENDED for one month. He is warned that a
repetition of the same or similar acts will be dealt with more
severely.
Let copies of this Decision be served on Atty. Thomas C. Uy
Jr. at his given address or any other known one. Copies of this
Decision shall also be entered in his record as attorney and
served on the IBP, as well as the Court Administrator who
shall circulate them to all the courts in the country for their
information and guidance.
SO ORDERED.
[A.C. No. 5235. March 22, 2000]
FERNANDO C. CRUZ AND AMELIA
CRUZ, complainants, vs. ATTY. ERNESTO C.
JACINTO, respondents. Jurisä
R E S O L U T I O N
MELO, J.:
In their sworn complaint, spouses Fernando C. Cruz and
Amelia Manimbo Cruz seek the disbarment of Atty. Ernesto
C. Jacinto. The Integrated Bar of the Philippines, through
Commissioner Jesulito A. Manalo of the Commissioner on
Bar discipline, conducted an investigation. Thereafter, he
submitted his Findings and Recommendation, thusly:
This is a disbarment case filed by the spouses
Fernando and Amelia Cruz against Atty. Ernesto C.
Jacinto. This case was filed with the Commission on
Bar Discipline last 30 January 1991.
The evidence of the complainants show that
sometime in June 1990, Atty. Ernesto Jacinto, lawyer
of the couple in an unrelated case, requested the Cruz
spouses for a loan in behalf of a certain Concepcion
G. Padilla, who he claimed to be an old friend as she
was allegedly in need of money. The loan requested
was for PhP 285,000.00 payable after 100 days for
PhP 360,000 to be secured by a real estate mortgage
on a parcel of land located at Quezon City. Scä juris
The spouses, believing and trusting the
representations of their lawyer that Padilla was a
good risk, authorized him to start preparing all the
necessary documents relative to the registration of the
Real Estate Mortgage to secure the payment of the
loan in favor of the Cruz spouses.
On 4 July 1990, the complainants agreed to the
request of Atty. Jacinto and were presented by the
latter with a Real Estate Mortgage Contract and a
Transfer Certificate of Title No. 127275 in the name
of Concepcion G. Padilla. The amount of PhP
285,000.00 was given by the spouses to the
respondent in cash (PhP 270,000.00) and a PBCom
check no. 713929 for PhP 15,000.00.
Upon maturity of the loan on 15 October 1990, the
spouses demanded payment from Concepcion G.
Padilla by going to the address given by the
respondent but there proved to be no person by that
name living therein. When the complainants verified
the genuineness of TCT No. 127275 with Register of
Deeds of Quezon City, it was certified by the said
office to be a fake and spurious title. Further efforts
to locate the debtor-mortgagor likewise proved
futile. Jurisä sc
In their sworn affidavits given before the National
Bureau of Investigation (NBI), the spouses claim that
they relied much on the reassurances made by Atty.
6

Jacinto as to Concepcion G. Padilla’s credit,
considering that he was their lawyer. It was also their
trust and confidence in Atty. Jacinto that made them
decide to forego meeting the debtor-mortgagor.
The complainants’ evidence also included the sworn
statements of Estrella Ermino-Palipada, the secretary
of the respondent at the Neri Law Office, and
Avegail Payos, a housemaid of Atty. Jacinto. Ms.
Palipada stated that:
1. she was the one who prepared the Real Estate
Mortgage Contract and the Receipt of the loan upon
the instruction of the respondents;
2. she was a witness to the transaction and never once
saw the person of Concepcion G. Padilla, the alleged
mortgagor; and that
3. she was instructed by Atty. Jacinto to notarize
the said contract by signing the name of one Atty.
Ricardo Neri.
Avegail Payos, the housemaid of the respondent, in
turn stated that she was the one who simulated the
signature of one Emmanuel Gimarino, the Deputy
Register of Deeds of Quezon City upon the
instruction of Atty. Jacinto. This was done to make it
appear that the real estate mortgage was registered
and the annotation to appear at the back of the TCT
as an encumbrance.
On 14 November 1997, a case for Estafa thru
Falsification of Public documents under Art. 315 was
filed against Atty. Jacinto. He was arrested and
detained by the NBI.
The defense of the respondent, on the other hand, was
embodied in his Answer with Motion to Dismiss filed
with the Commission on Bar Discipline. Therein, he
alleged that the criminal information for estafa thru
falsification filed against him had already been
dismissed because of the voluntary desistance of the
complainants. MisjÓ uris
In his version of the facts, Atty. Jacinto averred that
while he indeed facilitated the loan agreement
between the Cruz spouses and Concepcion G. Padilla,
he had no idea that the latter would give a falsified
Certificate of Title and use it to obtain a loan. He
claimed that he himself was a victim under the
circumstances.
Respondent further alleged that he had not been
remiss nor negligent in collecting the proceeds of the
loan; that in fact, he had even advanced the full
payment of the loan due to the complainants from his
own savings, even if Concepcion G. Padilla had not
yet paid, much less found.
RECOMMENDATIONS
It is every lawyer’s sworn duty to obey the laws of
the land to promote respect for law and legal
processes. The Code of Professional Responsibility
command that he shall not engage in unlawful,
dishonest, immoral or deceitful conduct. (Rule 1.01,
Code of Professional Responsibility) Jjä lex
In the instant case, there was a clear yet unrebutted
allegation in the complaint that the Respondent had
ordered his secretary and housemaid to falsify the
signatures of the notary public and the Deputy
Register of Deeds respectively to make it appear that
the real estate mortgage contract was duly registered
and thus binding.
While it may be true that the complaint for Estafa
thru Falsification filed against the Respondent had
been dismissed, the dismissal was because of the
complainant’s voluntary desistance and not a finding
of innocence. It neither confirms nor denies
Respondent’s non-culpability. Furthermore, it is well-
settled that disciplinary proceedings are "sui generis",
the primary object of which is not so much to punish
the individual attorney himself, as to safeguard the
administration of justice by protecting the court and
the public from the misconduct of lawyers, and to
remove from the professions persons whose disregard
of their oath have proven them unfit to continue
discharging the trust reposed in them as members of
the bar. Thus, disciplinary cases may still proceed
despite the dismissal of civil and/or criminal cases
against a lawyer.
A lawyer who does any unlawful fraudulent or
dishonest act may and should be held
administratively liable therefor. In the case at bar, the
Respondent should not be made an exception. While
it may be shown that he indeed advanced the
payment due to his erstwhile clients, such will not
exempt him from administrative liability. At best it
can only mitigate. Respondent is recommended to be
suspended for six (6) months from the practice of
law.
(Findings and Recommendation, pp. 1-4) NewÓ miso
On February 28, 1998, the Board of Governors of the IBP
passed Resolution XIII-97-199 adopting and approving the
Findings and Recommendation of the Investigating
Commissioner, which reads:
RESOLVED to ADOPT and APPROVE, as it is hereby
ADOPTED and APPROVED, the Report and
Recommendation of the Investigating Commissioner in
the above-entitled case, herein made part of this
Resolution/Decision as Annex "A" and, finding the
recommendation fully supported by the evidence on
record and the applicable laws and rules, respondent Atty.
7

Ernesto C. Jacinto is SUSPENDED from the practice of
law for six (6) months for his unlawful, fraudulent or
dishonest act.
(Notice of resolution [dated Feb. 28, 1998]).
In his Comment and Answer with Motion to Dismiss,
respondent averred that complainants have no cause of action
against him as the same has been waived, settled, and
extinguished on account of the affidavits of voluntary
desistance and quitclaim executed by them in the criminal case
filed against him. Ncmmis
The assertion must necessarily fail. The practice of law is so
intimately affected with public interest that it is both a right
and a duty of the State to control and regulate it in order to
promote the public welfare. The Constitution vests this power
of control and regulation in this Court. Since the practice of
law is inseparably connected with the exercise of its judicial
power in administration of justice, the Court cannot be
divested of its constitutionally ordained prerogative which
includes the authority to discipline, suspend or disbar any unfit
and unworthy member of the Bar by a mere execution of
affidavits of voluntary desistance and quitclaim (par. [5], Sec.
5, 1987 Constitution).
A lawyer may be disciplined or suspended for any
misconduct, whether in his professional or private capacity,
which shows him to be wanting in moral character, in honesty,
in probity and good demeanor, thus rendering unworthy to
continue as an officer of the court (Maligsa vs. Cabanting, 272
SCRA 408 [1997]), and the complainants who called the
attention of the Court to the attorney’s alleged misconduct are
in no sense a party, and have generally no interest in the
outcome except as all good citizens may have in the proper
administration of justice (Rayos-Ombac vs. Rayos, 285 SCRA
93 [1998]).
Undeniably, respondent represented complainants in the loan
transaction. By his own admission, he was the one who
negotiated with the borrower, his long-time friend and a
former client. He acted not merely as an agent but as a lawyer
of complaints, thus, the execution of the real estate mortgage
contract, as well as its registration and annotation on the title
were entrusted to him. In fact, respondent even received his
share in the interest earnings which complainants realized
from the transaction. His refusal to recognize any wrongdoing
or carelessness by claiming that he is likewise a victim when it
was shown that the title to the property, the registration of the
real estate mortgage contract, and the annotation thereon were
all feigned, will not at all exonerate him. Scncm
As a rule, a lawyer is not barred from dealing with his client
but the business transaction must be characterized with utmost
honesty and good faith. However, the measure of good faith
which an attorney is required to exercise in his dealings with
this client is a much higher standard than is required in
business dealings where the parties trade at arms length.
Business transactions between an attorney and his client are
disfavored and discouraged by the policy of the law. Hence,
courts carefully watch these transactions to be sure that no
advantage is taken by a lawyer over his client. This rule is
founded on public policy for, by virtue of his office, an
attorney is in an easy position to take advantage of the
credulity and ignorance of his client. Thus, no presumption of
innocence or improbability of wrongdoing is considered in an
attorney’s favor (Nakpit vs. Valdes, 286 SCRA 758 [1998]).
Further, his fidelity to the cause of his client requires him to be
evermindful of the responsibilities that should be expected of
him.
Verily, a lawyer may not, without being guilty of professional
misconduct, act as counsel for a person whose interest
conflicts with that of his former client. The reason for the
prohibition is found in the relation of attorney and client,
which is one of trust and confidence at the highest degree
(Maturan vs. Gonzales, 287 SCRA 943 [1998]). Sdaamiso
Respondent utterly failed to perform his duties and
responsibilities faithfully and well as to protect the rights and
interests of his clients and by his deceitful actuations
constituting violations of the Code of Professional
Responsibilities must be subjected to disciplinary measures for
his own good, as well as for the good of the entire membership
of the Bar as a whole.
WHEREFORE, the Court hereby adopts the resolution of the
Board of Governors of the Integrated Bar of the Philippines
and orders respondent Atty. Ernesto C. Jacinto suspended
from the practice of law for six (6) months with the warning
that a repetition of the same or similar offense will be dealt
with more severely. Sdaad
SO ORDERED.
December 8, 1923
VICENTE DIAZ, complainant,
vs.
RUPERTO KAPUNAN, respondent.
Attorney-General Villa-Real for the Government.
Perfecto Gabriel and Rafael Palma for respondent.
MALCOLM, J.:
This action for malpractice brought by Vicente Diaz against
Attorney Ruperto Kapunan, has to do with the conduct of
Attorney Kapunan during the legal proceedings which
followed the business troubles of Vicente Diaz and Secundino
de Mendezona, and particularly relates to the conduct of
Attorney Kapunan in civil case No. 2098 of the Court of First
Instance of Leyte. The ultimate question on which we would
concentrate attention concerns the agreement between Diaz
and Kapunan at the time of the sale of the property of
Mendoza, whereby Kapunan, on the promise of Diaz to pay
him P1,000, agreed to desist from further participation in the
sale, all in alleged violation of article 1459 of the Civil Code
and article 542 of the Penal Code.
8

Omitting the irrelevant matter interjected into this case, the
principal facts of record are the following:
In 1917, Vicente Diaz and Secundino de Mendezona formed a
partnership and entered into extensive business transactions in
the Province of Leyte. The capital of the partnership was
P380,000. Unfortunately, however, the business failed to
prosper, with the result that on liquidation, it was found to
have suffered a loss of P67,000. When Diaz and Mendezona
came to settle up their affairs, they eventually formulated a
document of sale and mortgage in which Mendezona
recognized a debt in favor of Diaz in the sum of P80,000 and
an additional sum of P10,000 owing to Diaz, laid upon the
hacienda "Mapuyo," and to be paid within the term of one
year. When the year had expired Mendezona was not to be
found and his family was unable to meet the payment. There
followed the usual proceedings for foreclosure and sale,
which, after considerable delay, resulted in the hacienda's
being offered for sale at public auction.
At the time fixed for the sale, December 23, 1922, there
appeared Vicente Diaz, accompanied by his lawyer Emilio
Benitez, and Attorney Ruperto Kapunan. Luis Velarde, the
deputy sheriff of Leyte, is authority for the statement that
Kapunan told him that he, Kapunan, was ready to bid on the
property up to P16,000 in order to assist the Mendezona
family which was in financial straits. At any rate, the bidding
was opened by Kapunan offering P12,000 for the property and
with Diaz and Kapunan raising the bids until finally Diaz
offered P12,500. There the bids stopped on account of Diaz
and Kapunan entering into the agreement, of decisive
importance, which we next quote in full:
We, Vicente Diaz and Ruperto Kapunan, both being the
bidders at the auction held for the sale of the properties of
Secundino Mendezona, do hereby agreed that Don Ruperto
Kapunan should withdraw his bid and refrain from bidding at
the said auction as he does hereby withdraw his bid, and in
consideration thereof, the said Mr. Diaz offers him a premium
of one thousand pesos (P1,000) which, out of consideration to
said Don Vicente Diaz, Mr. Kapunan accepts and has, for this
reason, refrained from bidding in competition with said Mr.
Diaz.lawphi1.net
Tacloban, Leyte, December 23, 1922.
(Sgd.) "V. DIAZ. (Sgd.)
RUPERTO KAPUNAN."
Following the termination of the sheriff's sale, Diaz on
December 26, 1922, gave Kapunan P500 of the P1,000
mentioned in the above quoted document. Diaz further
followed the usual procedure to take over the property of
Mendezona pursuant to his bid of P12,500, which covered the
amount of the mortgage with its accumulated interest and with
the judicial expenses.
Although it was on December 23, 1922, that Diaz and
Kapunan entered into the agreement, Diaz could only wait
until January 4, 1923, following, to lay before this court
charges against Attorney Kapunan for alleged unprofessional
conduct. Undoubtedly, before Kapunan had knowledge of the
disbarment proceedings, on January 10, 1923, he presented a
motion in the Court of First Instance of Leyte asking that he
be permitted to retain the P500 in question, in part payment of
his professional fees. Later, on February 4, 1923, when
Kapunan must have had knowledge of the disbarment
proceedings, he filed another motion, withdrawing his former
motion and asking the court to permit him to turn over the
P500 to Diaz, which Judge Causing refused to do on the
ground that it was a personal matter. Nevertheless, on July 10,
1923, the clerk of the Court of First Instance of Leyte handed
the P500 to Diaz who, in turn, receipted for that amount.
lawphil.net
From correspondence, it further is evident that the family of
Mendezona was led to believe that the P500 would shortly be
sent them. Without doubt, the Mendezona family would have
been gratified to receive even the P500 pittance out of the
business wreck in Leyte of the senior Mendezona.
During much of the time here mentioned, Kapunan was the
attorney of Mendezona. Kapunan was given extensive
authority by the letter of Mendezona of April 12, 1919. When
Kapunan took part in the sale, it must be assumed that he was
bidding in representation of his client and for the benefit of the
client.
It remains to be said that following the presentation of the
charges against Attorney Kapunan in this court, he was given
an opportunity to answer, and the usual investigation of his
professional conduct was made by the provincial fiscal of
Leyte acting under the supervision of the Attorney-General.
From the report of the fiscal, indorsed by the Attorney-
General, three charges seem to have been considered. The first
two, relating to Kapunan's attempt to represent both the parties
in the case, and to molest and disturb Diaz by frivolous
motions, the law officer of the Government finds not
substantiated; and with this conclusion we fully agree. The
third charge is more serious and has to do with Kapunan
having intervened in the manner in which he did in the sale of
the property of his client Mendezona. The Attorney-General is
of the opinion on this point that the facts constitute a flagrant
violation of the provisions of article 1459 of the Civil Code
and article 542 of the Penal Code. "In view thereof, it is
recommended that corrective measures commensurate with
the irregularity committed by Attorney Kapunan, be taken
against him."
Article 1459 of the Civil Code was held in force in the case of
Hernandez vs. Villanueva ([1920], 40 Phil., 775). It provides
that the following persons, naming them, "cannot take by
purchase, even at a public or judicial auction, either in person
or through the mediation of another." The provision contained
in the last paragraph of said article is made to include lawyers,
with respect to any property or rights involved in any litigation
in which they may take party by virtue of their profession and
office. We do not believe this article has been infringed by the
respondent because he has not purchased property at a public
or judicial auction and because his participation in the auction
was in representation of his client. It has been held that an
execution sale to the attorney of the defendant is not unlawful
if made in good faith, with the consent of the client, and
without any purpose of defrauding the latter's creditors. (2 R.
9

C. L., 1011; 1 Thornton on Attorneys at Law, pp. 298, 299;
Smith vs. Smith [1848], 1 Iowa, 307.)
The more puzzling question relates to the alleged violation by
Attorney Kapunan of article 542 of the Penal Code. This
article punishes "any person who shall solicit any gift or
promise as a consideration for agreeing to refrain from taking
part in any public auction." The crime is consummated by the
mere act of soliciting a gift or promise for the purpose of
abstaining from taking part in the auction. Not permitting our
minds to be confused by the varied explanations of Diaz and
Kapunan, the document formulated by them and hereinbefore
quoted, demonstrates that Kapunan, on the promise of Diaz to
pay P1,000, refrained from further participation in the sale of
the property of Mendezona, which is exactly the situation
covered by article 542 of the Penal Code.
Public policy discountenances combinations or agreements on
the part of bidders at execution sales, the objects and effects of
which are to stifle competition. The courts will consider an
agreement between a judgment creditor and one claiming an
interest in the thing about to be sold under an execution, that
neither shall bid against the other, as void, unless all parties
concerned know of the arrangement and consent thereto.
Execution sales should be open to free and full competition, in
order to secure the maximum benefit for the debtor. Article
542 of the Penal Code is, therefore, a wise provision even
though rarely invoked, and should be used to discourage the
stifling of bids at judicial sales. (23 C.J., 647; Packard vs. Bird
and Chapman [1870], 40 Cal., 378; 3 Viada, Codigo Penal,
594.)
We conclude that Attorney Kapunan has been guilty of a
technical violation of article 542 of the Penal Code. But we
cannot adopt the vigorous recommendation of the Attorney-
General, for we consider present certain mitigating
circumstances which exert an influence in favor of the
respondent. In the first place, as disclosed by the judicial
records, no reported prosecution under article 542 has been
attempted, which is eloquent proof of the practical disuse of
this article; and the Spanish jurisprudence, while indicative of
the meaning of the article, relies principally on the decisions
of the French Court of Cassation. (See Code of Napoleon, arts.
222, 223; decisions of the French Court of Cassation of
October 16, 1844, May 15, 1857, and January 8, 1863.) In the
next place, the complainant Diaz is equally guilty with the
respondent Kapunan. And lastly, Kapunan appears to have
been acting in good faith for his client, although adopting an
irregular procedure, and although attempting to make tardy
restitution of the money received by him.
Our judgment is that Attorney Ruperto Kapunan shall stand
reprimanded and that the complainant, Vicente Diaz, shall
immediately return to the clerk of the Court of First Instance
of Leyte the P500 received by Diaz from the clerk and
receipted for by Diaz, and the clerk of court shall transmit the
P500 to Secundino de Mendezona or, in case of his absence, to
Miss Carmen de Mendezona. Costs shall be taxed in
accordance with the provisions of the Code of Civil
Procedure. So ordered.
Johnson, Avanceña, Villamor, Ostrand and Johns, JJ., concur.
Romualdez, J., took no part.
B. ACCOUNTING OF CLIENT’S FUNDS
[A.C. No. 4083. March 27, 2000]
LEONITO GONATO and PRIMROSE
GONATO complainants, vs. ATTY. CESILO A.
ADAZA, respondent.
R E S O L U T I O N
MELO, J.: Sclaw
At bar is an administrative complaint for disbarment filed by
the complainant spouses Leonito and Primrose Gonato against
their former counsel, Atty. Cesilo A. Adaza, charging him
with malpractice and violation of trust. Pursuant to Rule 139-
B of the Rules of Court and the Resolution of the Court dated
December 1, 1993, the present administrative case was
referred to the Integrated Bar of the Philippines (IBP) for
investigation, report, and recommendation.
It appears that sometime in February, 1993, complainants
engaged the services of respondent as their counsel in Civil
Case No. 92-263 entitled Goking vs. Yacapin, et al." filed with
the Regional Trial Court of Misamis Oriental, wherein
complainants were among the defendants in said case.
Complainants alleged that respondent demanded from them
the sum of P15,980.00 to be used in paying the docket fee and
other court fees in connection with the aforementioned case.
Said amount was loaned to complainants by a friend, Vic
Manzano, who delivered the same to respondent, as evidenced
by an acknowledgment receipt dated February 10, 1993 and
signed by respondent's secretary, Mayette Salceda. Thereafter,
complainants asked for the official receipts evidencing the
amount of court fees purportedly paid by respondent. Vic
Manzano told complainants that respondent only gave him
photocopies of two Republic of the Philippines receipts with
numbers 9627143 (Exhibit "C") dated February 11, 1993, in
the amount of P15,830.00; and 7447868 (Exhibit "D") also
dated February 11, 1993, in the amount of P150.00.
Dissatisfied, complainant Primrose Gonato personally went to
respondent's law office at least three times, and asked for the
original copies of the receipts, but to no avail. Primrose's
suspicion grew stronger, and this prompted her to verify the
authenticity of said receipts with the office of the Clerk of
Court of the Regional Trial Court of Cagayan de Oro City.
There, it was discovered that the triplicate original copies of
the receipts did not reflect the same amount contained on the
photocopies of the receipts given by respondent. Receipt No.
9627143 in the Clerk of Court's Office showed only the
amount of P2,470.00 and was Dated May 15, 1992, while that
given by respondent bore the amount of P15,830.00. On the
other hand, Receipt No. 7447868 per Office of Clerk of Court
records revealed the sum of P4,000.00, while that provided by
respondent disclosed the sum of P150.00, presumably to
conform to the amount paid by complainant which was
10

P15,980.00. Complainants demanded the return of P15,980.00
but respondent refused to do so. Thus, in April, 1993,
complainants urged respondent to withdraw as counsel due to
loss of trust and confidence.
For his part, respondent lawyer admits that he received from
Vic Manzano the amount of P15,980.00 which was initially
intended to cover the filing fees, sheriff fees, and U.P. Law
Center fees in the filing of counterclaim on behalf of herein
complainants. But according to him, after careful study, he
realized that the counterclaim is compulsory and not
permissive, and so he applied instead the aforesaid sum of
P15,980.00 to his acceptance and appearance fees, which fact
was even communicated to Vic Manzano, who was
complainants' contact or liason person with respondent.
Respondent also specifically denied that he caused the
delivery of the falsified photocopies of O.R. Nos. 9627143
and 7447868 to complainant spouses. Sclex
In its Resolution dated January 28, 1999, the Board of
Governors of the Integrated Bar of the Philippines adopted and
approved the Investigating Commissioner's report and
recommendation with an amendment that respondent be
suspended from the practice of law for three (3) months.
The IBP Commission on Bar Discipline found sufficient
evidence to sustain complainants' claim that respondent
charged them the amount of P15,980.00 for filing fees when in
fact no such fees were due. It rejected respondent's claim that
the subject amount was applied to his attorney's fees as this is
belied by the statement of account he issued to complainants
indubitably showing that complainants were charged of said
amount for filing fees.
This Court is in full accord with the findings and
recommendation of the IBP that respondent lawyer has
sufficiently demonstrated conduct showing his unfitness for
the confidence and trust which characterize the attorney-client
relationship. His act of requiring complainants to pay an
exorbitant amount on the pretext that it was needed for the
payment of court fees which were not even substantiated by
proper official receipts, constitutes malpractice which is a
serious breach of professional duty toward complainants
whose trust respondent disregarded and violated. Respondent
expressly admitted having received the money, but he
persistently refused to return the same despite repeated
demands by the complainants. This conduct of the respondent
is clearly indicative of lack of integrity and moral soundness,
as he was clinging to something which was not his and to
which he absolutely had no right. Respondent’s shallow
excuse that he applied said money to his attorney's fees is
merely an afterthought and cannot justify his refusal to return
the same, as this was made without the acquiescence of the
complainants. It is settled that the conversion by a lawyer of
funds entrusted to him is a gross violation of professional
ethics and a betrayal of public confidence in the legal
profession (Obia vs. Catimbang, 196 SCRA 23 [1991]).
Likewise, respondent offered no solid proof to support his
denial that he delivered the two falsified receipts to
complainants. Xlaw
Canon 7 of the Code of Professional Responsibility mandates
that "a lawyer shall at all times uphold the integrity and
dignity of the legal profession." The trust and confidence
necessarily reposed by clients require in the lawyer a high
standard and appreciation of his duty to them. To this end,
nothing should be done by any member of the legal fraternity
which might tend to lessen in any degree the confidence of the
public in the fidelity, honesty, and integrity of the profession
(Marcelo vs. Javier, Sr., 214 SCRA 1 [1992]).
The facts and evidence obtaining in this case glaringly reveal
respondent's failure to live up to his duties as a lawyer in
consonance with the strictures of his oath and the Code of
Professional Responsibility, particularly Canon 16 which
provides that "a lawyer shall hold in trust all moneys and
properties of his client that may come into his possession." As
a member of the Bar, respondent was and is expected to
always live up to the standards embodied in said Code
particularly Canons 15, 16, 17 and 20, for the relationship
between an attorney and his client is highly fiduciary in nature
and demands utmost fidelity and good faith (Igual vs.
Javier 254 SCRA 416 [1996]). The Court believes that a
longer period of suspension than that recommended by the
IBP is called for under the circumstances.
WHEREFORE, respondent Atty. Cesilo A. Adaza is hereby
suspended from the practice of law for a period of six (6)
months from notice, with the warning that a repetition of the
same or similar acts will be dealt with more severely.
Respondent is further ordered to restitute to complainants the
amount of P15,980.00 within 30 days from notice, without
prejudice to whatever judicial action he may take to recover
his unsatisfied attorney's fees, if any. Let copies of this
resolution be furnished all courts in the land, the Integrated
Bar of the Philippines, the Office of the Bar Confidant, and let
it be spread in respondent's personal record.
SO ORDERED. Xsc
A.C. No. 7418 October 9, 2007
ANDREA BALCE CELAJE, complainant,
vs.
ATTY. SANTIAGO C. SORIANO, respondent.
R E S O L U T I O N
AUSTRIA-MARTINEZ, J.:
Before this Court is a disbarment case filed against Atty.
Santiago C. Soriano (respondent) for gross misconduct.
In the Complaint dated June 1, 2005 filed before the Integrated
Bar of the Philippines (IBP), Andrea Balce Celaje
(complainant) alleged that respondent asked for money to be
put up as an injunction bond, which complainant found out
later, however, to be unnecessary as the application for the
writ was denied by the trial court. Respondent also asked for
money on several occasions allegedly to spend for or to be
given to the judge handling their case, Judge Milagros
Quijano, of the Regional Trial Court, Iriga City, Branch 36.
11

When complainant approached Judge Quijano and asked
whether what respondent was saying was true, Judge Quijano
outrightly denied the allegations and advised her to file an
administrative case against respondent.1
In his Answer, respondent denied the charges against him and
averred that the same were merely concocted by complainant
to destroy his character. He also contended that it was
complainant who boasted that she is a professional fixer in
administrative agencies as well as in the judiciary; and that
complainant promised to pay him large amounts of attorney's
fees which complainant however did not keep.2
Both parties appeared in the Mandatory Conference and
Hearing on January 18, 2006. Thereafter, the case was
submitted for decision.3
In the Report and Recommendation dated January 24, 2006,
IBP-Commission on Bar Discipline Commissioner Dennis
A.B. Funa found respondent guilty of Gross Misconduct in his
relations with his client and recommended that respondent be
suspended for three years from the practice of law.4
In the Report, Commissioner Funa found that:
During the hearing conducted, Complainant alleged that she
has remitted to Respondent, on various dates, amounts of
money totaling to more or less P270,000.00.
According to Complainant the amounts given in several
instances were all undocumented and not acknowledged in
writing.
However, for the alleged amount of P14,000.00 intended for
an injunction bond, some documents in writing were made.
x x x x
While the amounts remitted by Complainant to Respondent
were never acknowledged in writing and were not
documented, due credence must be given to Complainant's
allegations especially over the amount of P14,800.00 intended
for the injunction. Indeed, there is no ill-motive at all on the
part of Complainant to fabricate charges against Respondent.
Unfortunately, none of the P270,000.00 given by Complainant
to Respondent was ever documented and therefore accuracy of
the amounts could not be established and substantiated.
What has been documented only pertains to the unpaid
P5,800.00 intended for the injunction bond. However, it has
been established that indeed an accumulated amount of
P9,000.00 has been remitted by Respondent to Valentina
Ramos and only the unpaid P5,800.00 remains unaccounted
for by the Respondent.
During the hearing conducted, Complainant reiterated her
accusations against the Respondent and expressed that she has
been aggrieved and misled by Respondent. According to
Complainant, this was made possible because she was not
aware of or knowledgeable on legal matters and practices.
Respondent has only offered denials to the charges. However,
the circumstances gives credibility to herein Complainant in
the absence of any evil motive on her part.
Accordingly, Respondent is clearly guilty of misappropriating
his client's funds in the amount of P5,800.00. While other
amounts may have been misappropriated, Complainant alleges
P270,000.00, the exactness of the amounts could not be
established.
Respondent is also guilty of deceiving his client and abusing
his client's confidence in requesting for several amounts of
money on the pretense that he had to spend for and pay the
trial judge.
Respondent is hereby ORDERED to immediately deliver the
unaccounted for amount of Five Thousand Eight Hundred
Pesos (P5,800.00) to Complainant, submitting a Compliance
Report thereon.5
On September 8, 2006, the Board of Governors of the IBP
passed a Resolution thus:
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 that Respondent is guilty of gross misconduct
for misappropriating his client's funds, Atty. Santiago C.
Soriano is hereby SUSPENDED from the practice of law for
two (2) years and likewise Ordered to immediately deliver that
unaccounted amount of P5,800.00 to complainant.6
The IBP transmitted the Notice of Resolution issued by the
IBP Board of Governors as well as the records of the case,
pursuant to Rule 139-B.7 Then in compliance with the Court's
Resolution dated February 20, 2007, the IBP through Director
for Discipline Rogelio Vinluan informed the Court that per
records of the IBP, no Motion for Reconsideration was filed
by either party.
The Court agrees with the IBP Resolution.
The Code of Professional Responsibility (CPR), particularly
Canon 16 thereof, mandates that a lawyer shall hold in trust all
moneys and properties of his client that may come into his
possession. He shall account for all money or property
collected or received from his client8 and shall deliver the
funds and property of his client when due or upon demand.9
As found by Commissioner Funa, it was established that
respondent could not account for P5,800.00 which was part of
the sum given by complainant to him for the purpose of filing
an injunctive bond. Respondent admitted having received
from complainant P17,800.00 on April 19, 2002 for the
preliminary injunction10 and admitted to having a balance of
P9,000.00 in his promissory note to the Manila Insurance Co.,
Inc. dated April 23, 2002, which was reduced to P5,800.00 by
reason of an additional payment of P4,000.00,11 leaving an
amount of P5,800.00 unaccounted for. The affidavit of the
insurance agent, Valentina Ramos, dated December 8, 2005
12

also states that even up to said date, respondent had not yet
paid the balance of P5,800.00.12
Respondent's failure to return the money to complainant upon
demand gave rise to the presumption that he misappropriated
it for his own use to the prejudice of, and in violation of the
trust reposed in him by his client.13 It is a gross violation of
general morality and of professional ethics and impairs public
confidence in the legal profession which deserves
punishment.14
As the Court has pronounced, when a lawyer receives money
from the client for a particular purpose, the lawyer is bound to
render an accounting to the client showing that the money was
spent for a particular purpose. And if he does not use the
money for the intended purpose, the lawyer must immediately
return the money to his client.15
The Court has been exacting in its demand for integrity and
good moral character of members of the Bar who are expected
at all times to uphold the integrity and dignity of the legal
profession and refrain from any act or omission which might
lessen the trust and confidence reposed by the public in the
fidelity, honesty, and integrity of the legal profession. Indeed,
membership in the legal profession is a privilege.16 The
attorney-client relationship is highly fiduciary in nature. As
such, it requires utmost good faith, loyalty, fidelity and
disinterestedness on the part of the lawyer.17
In Small v. Banares18 the respondent was suspended for two
years for violating Canon 16 of the CPR, particularly for
failing to file a case for which the amount of P80,000.00 was
given him by his client, and for failing to return the said
amount upon demand. Considering that similar circumstances
are attendant in this case, the Court finds the Resolution of the
IBP imposing on respondent a two-year suspension to be in
order.
WHEREFORE, respondent Atty. Santiago C. Soriano is found
GUILTY of violating Canon 16 of the Code of Professional
Responsibility and is hereby SUSPENDED from the practice
of law for a period of two (2) years from notice, with a
STERN WARNING that a repetition of the same or similar
acts shall be dealt with more severely.
Respondent is further ordered to restitute to his clients through
Andrea Balce Celaje, within 30 days from notice, the amount
of P5,800.00. Respondent is directed to submit to the Court
proof of payment within fifteen days from payment of the full
amount.
Let copies of this Resolution be furnished all courts of the
land, the Integrated Bar of the Philippines, as well as the
Office of the Bar Confidant for their information and
guidance, and let it be entered in respondent's record in this
Court.
SO ORDERED.
[A.C. CBD No. 167. March 9, 1999]
ATTY. PRUDENCIO S. PENTICOSTES, complainant,
vs. PROSECUTOR DIOSDADO S. IBAÑEZ, respondent.
R E S O L U T I O N
ROMERO, J.:
Sometime in 1989, Encarnacion Pascual, the sister-in-
law of Atty. Prudencio S. Penticostes (herein complainant)
was sued for non-remittance of SSS payments. The complaint
was docketed as I.S. 89-353 and assigned to Prosecutor
Diosdado S. Ibañez (herein respondent) for preliminary
investigation. In the course of the investigation, Encarnacion
Pascual gave P1,804.00 to respondent as payment of her
Social Security System (SSS) contribution in
arrears. Respondent, however, did not remit the amount to the
system. The fact of non-payment was certified to by the SSS
on October 2, 1989.
On November 16, 1990 or over a year later, complainant
filed with the Regional Trial Court of Tarlac a complaint for
professional misconduct against Ibañez due to the latter’s
failure to remit the SSS contributions of his sister-in-law. The
complaint alleged that respondent’s misappropriation of
Encarnacion Pascual’s SSS contributions amounted to a
violation of his oath as a lawyer. Seven days later, or on
November 23, 1990, respondent paid P1,804.00 to the SSS on
behalf of Encarnacion Pascual.
In the meantime, the case was referred to the Integrated
Bar of the Philippines-Tarlac Chapter, the court observing that
it had no competence to receive evidence on the matter. Upon
receipt of the case, the Tarlac Chapter forwarded the same to
IBP’s Commission on Bar Discipline.
In his defense, respondent claimed that his act of
accommodating Encarnacion Pascual’s request to make
payment to the SSS did not amount to professional misconduct
but was rather an act of Christian charity. Furthermore, he
claimed that the action was moot and academic, the amount
of P1,804.00 having already been paid by him to the
SSS. Lastly, he disclaimed liability on the ground that the acts
complained were not done by him in his capacity as a
practicing lawyer but on account of his office as a prosecutor.
On September 3, 1998, the Commission recommended
that the respondent be reprimanded, with a warning that the
commission of the same or similar offense would be dealt with
more severely in the future. On November 5, 1998, the Board
of Governors of the Integrated Bar of the Philippines adopted
and approved its Commission’s recommendation.
This Court adopts the recommendation of the IBP and
finds respondent guilty of professional misconduct. While
there is no doubt that payment of the contested amount had
been effected to the SSS on November 23, 1990, it is clear
however, that the same was made only after a complaint had
been filed against respondent. Furthermore, the duties of a
provincial prosecutor do not include receiving money from
persons with official transactions with his office.
13

This Court has repeatedly admonished lawyers that a
high sense of morality, honesty and fair dealing is expected
and required of a member of the bar. Rule 1.01 of the Code of
Professional Responsibility provides that “[a] lawyer shall not
engage in unlawful, dishonest, immoral or deceitful conduct.”
It is glaringly clear that respondent’s non-remittance for
over one year of the funds coming from Encarnacion Pascual
constitutes conduct in gross violation of the above canon. The
belated payment of the same to the SSS does not excuse his
misconduct. While Pascual may not strictly be considered a
client of respondent, the rules relating to a lawyer’s handling
of funds of a client is applicable. In Daroy v. Legaspi,[1]
this
court held that “(t)he relation between an attorney and his
client is highly fiduciary in nature...[thus] lawyers are bound
to promptly account for money or property received by them
on behalf of their clients and failure to do so constitutes
professional misconduct.” The failure of respondent to
immediately remit the amount to the SSS gives rise to the
presumption that he has misappropriated it for his own
use. This is a gross violation of general morality as well as
professional ethics; it impairs public confidence in the legal
profession and deserves punishment.[2]
Respondent’s claim that he may not be held liable
because he committed such acts, not in his capacity as a
private lawyer, but as a prosecutor is unavailing. Canon 6 of
the Code of Professional Responsibility provides:
“These canons shall apply to lawyers in government service in
the discharge of their official tasks.”
As stated by the IBP Committee that drafted the Code, “a
lawyer does not shed his professional obligations upon
assuming public office. In fact, his public office should make
him more sensitive to his professional obligations because a
lawyer’s disreputable conduct is more likely to be magnified
in the public’s eye.[3]
Want of moral integrity is to be more
severely condemned in a lawyer who holds a responsible
public office.[4]
ACCORDINGLY, this Court REPRIMANDS
respondent with a STERN WARNING that a commission of
the similar offense will be dealt with more severely in the
future.
LET copies of this decision be spread in his records and
copies be furnished the Department of Justice and the Office
of the Bar Confidant.
SO ORDERED.
C. RESTRICTION AGAINST BUYING
CLIENTS PROPERTY
G.R. No. L-35702 May 29, 1973
DOMINGO D. RUBIAS, plaintiff-appellant,
vs.
ISAIAS BATILLER, defendant-appellee.
Gregorio M. Rubias for plaintiff-appellant.
Vicente R. Acsay for defendant-appellee.
TEEHANKEE, J.:
In this appeal certified by the Court of Appeals to this Court as
involving purely legal questions, we affirm the dismissal order
rendered by the Iloilo court of first instance after pre-trial and
submittal of the pertinent documentary exhibits.
Such dismissal was proper, plaintiff having no cause of action,
since it was duly established in the record that the application
for registration of the land in question filed by Francisco
Militante, plaintiff's vendor and predecessor interest, had been
dismissed by decision of 1952 of the land registration court as
affirmed by final judgment in 1958 of the Court of Appeals
and hence, there was no title or right to the land that could be
transmitted by the purported sale to plaintiff.
As late as 1964, the Iloilo court of first instance had in another
case of ejectment likewise upheld by final judgment
defendant's "better right to possess the land in question .
having been in the actual possession thereof under a claim of
title many years before Francisco Militante sold the land to the
plaintiff."
Furthermore, even assuming that Militante had anything to
sell, the deed of sale executed in 1956 by him in favor of
plaintiff at a time when plaintiff was concededly his counsel
of record in the land registration case involving the very land
in dispute (ultimately decided adversely against Militante by
the Court of Appeals' 1958 judgment affirming the lower
court's dismissal of Militante's application for registration)
was properly declared inexistent and void by the lower court,
as decreed by Article 1409 in relation to Article 1491 of the
Civil Code.
The appellate court, in its resolution of certification of 25 July
1972, gave the following backgrounder of the appeal at bar:
On August 31, 1964, plaintiff Domingo D. Rubias, a lawyer,
filed a suit to recover the ownership and possession of certain
portions of lot under Psu-99791 located in Barrio General
Luna, Barotac Viejo, Iloilo which he bought from his father-
in-law, Francisco Militante in 1956 against its present
occupant defendant, Isaias Batiller, who illegally entered said
portions of the lot on two occasions — in 1945 and in 1959.
Plaintiff prayed also for damages and attorneys fees. (pp. 1-7,
Record on Appeal). In his answer with counter-claim
defendant claims the complaint of the plaintiff does not state a
cause of action, the truth of the matter being that he and his
predecessors-in-interest have always been in actual, open and
continuous possession since time immemorial under claim of
ownership of the portions of the lot in question and for the
alleged malicious institution of the complaint he claims he has
suffered moral damages in the amount of P 2,000.00, as well
as the sum of P500.00 for attorney's fees. ...
On December 9, 1964, the trial court issued a pre-trial order,
after a pre-trial conference between the parties and their
counsel which order reads as follows..
14

'When this case was called for a pre-trial conference today, the
plaintiff appeared assisted by himself and Atty. Gregorio M.
Rubias. The defendant also appeared, assisted by his counsel
Atty. Vicente R. Acsay.
A. During the pre-trial conference, the parties have agreed that
the following facts are attendant in this case and that they will
no longer introduced any evidence, testimonial or
documentary to prove them:
1. That Francisco Militante claimed ownership of a
parcel of land located in the Barrio of General Luna,
municipality of Barotac Viejo province of Iloilo, which he
caused to be surveyed on July 18-31, 1934, whereby he was
issued a plan Psu-99791 (Exhibit "B"). (The land claimed
contained an area of 171:3561 hectares.)
2. Before the war with Japan, Francisco Militante filed
with the Court of First Instance of Iloilo an application for the
registration of the title of the land technically described in psu-
99791 (Exh. "B") opposed by the Director of Lands, the
Director of Forestry and other oppositors. However, during the
war with Japan, the record of the case was lost before it was
heard, so after the war Francisco Militante petitioned this
court to reconstitute the record of the case. The record was
reconstituted on the Court of the First Instance of Iloilo and
docketed as Land Case No. R-695, GLRO Rec. No. 54852.
The Court of First Instance heard the land registration case on
November 14, 1952, and after the trial this court dismissed the
application for registration. The appellant, Francisco Militante,
appealed from the decision of this Court to the Court of
Appeals where the case was docketed as CA-GR No. 13497-
R..
3. Pending the disposal of the appeal in CA-GR No.
13497-R and more particularly on June 18, 1956, Francisco
Militante sold to the plaintiff, Domingo Rubias the land
technically described in psu-99791 (Exh. "A"). The sale was
duly recorded in the Office of the Register of Deeds for the
province of Iloilo as Entry No. 13609 on July 11, 1960 (Exh.
"A-1").
(NOTE: As per deed of sale, Exh. A, what Militante
purportedly sold to plaintiff-appellant, his son-in-law, for the
sum of P2,000.00 was "a parcel of untitled land having an area
Of 144.9072 hectares ... surveyed under Psu 99791 ... (and)
subject to the exclusions made by me, under (case) CA-i3497,
Land Registration Case No. R-695, G.L.R.O. No. 54852,
Court of First Instance of the province of Iloilo. These
exclusions referred to portions of the original area of over 171
hectares originally claimed by Militante as applicant, but
which he expressly recognized during the trial to pertain to
some oppositors, such as the Bureau of Public Works and
Bureau of Forestry and several other individual occupants and
accordingly withdrew his application over the same. This is
expressly made of record in Exh. A, which is the Court of
Appeals' decision of 22 September 1958 confirming the land
registration court's dismissal of Militante's application for
registration.)
4. On September 22,1958 the Court of appeals in CA-
G.R. No. 13497-R promulgated its judgment confirming the
decision of this Court in Land Case No. R-695, GLRO Rec.
No. 54852 which dismissed the application for Registration
filed by Francisco Militante (Exh. "I").
5. Domingo Rubias declared the land described in Exh.
'B' for taxation purposes under Tax Dec. No. 8585 (Exh. "C")
for 1957; Tax Dec. Nos. 9533 (Exh. "C-1") and 10019 (Exh.
"C-3")for the year 1961; Tax Dec. No. 9868 (Exh. "C-2") for
the year 1964, paying the land taxes under Tax Dec. No. 8585
and 9533 (Exh. "D", "D-1", "G-6").
6. Francisco Militante immediate predecessor-in-
interest of the plaintiff, has also declared the land for taxation
purposes under Tax Dec. No. 5172 in 1940 (Exh. "E") for
1945; under Tax Dec. No. T-86 (Exh. "E-1") for 1948; under
Tax Dec. No. 7122 (Exh. "2"), and paid the land taxes for
1940 (Exhs. "G" and "G-7"), for 1945 46 (Exh. "G-1") for
1947 (Exh. "G-2"), for 1947 & 1948 (Exh. "G-3"), for 1948
(Exh. "G-4"), and for 1948 and 1949 (Exh. "G-5").
7. Tax Declaration No. 2434 in the name of Liberato
Demontaño for the land described therein (Exh. "F") was
cancelled by Tax. Dec. No. 5172 of Francisco Militante (Exh.
"E"). Liberato Demontaño paid the land tax under Tax Dec.
No. 2434 on Dec. 20, 1939 for the years 1938 (50%) and 1959
(Exh. "H").
8. The defendant had declared for taxation purposes Lot
No. 2 of the Psu-155241 under Tax Dec. Not. 8583 for 1957
and a portion of Lot No. 2, Psu-155241, for 1945 under Tax
Dec. No. 8584 (Exh. "2-A" Tax No. 8583 (Exh. "2") was
revised by Tax Dec. No. 9498 in the name of the defendant
(Exh. "2-B") and Tax Dec. No. 8584 (Exh. "2-A") was
cancelled by Tax Dec. No. 9584 also in the name of the
defendant (Exh. "2-C"). The defendant paid the land taxes for
Lot 2, Psu-155241, on Nov. 9, 1960 for the years 1945 and
1946, for the year 1950, and for the year 1960 as shown by the
certificate of the treasurer (Exh. "3"). The defendant may
present to the Court other land taxes receipts for the payment
of taxes for this lot.
9. The land claimed by the defendant as his own was
surveyed on June 6 and 7,1956, and a plan approved by
Director of Land on November 15, 1956 was issued, identified
as Psu 155241 (Exh. "5").
10. On April 22, 1960, the plaintiff filed forcible Entry
and Detainer case against Isaias Batiller in the Justice of the
Peace Court of Barotac Viejo Province of Iloilo (Exh. "4") to
which the defendant Isaias Batiller riled his answer on August
29, 1960 (Exh. "4-A"). The Municipal Court of Barotac Viejo
after trial, decided the case on May 10, 1961 in favor of the
defendant and against the plaintiff (Exh. "4-B"). The plaintiff
appealed from the decision of the Municipal Court of Barotac
Viejo which was docketed in this Court as Civil Case No.
5750 on June 3, 1961, to which the defendant, Isaias Batiller,
on June 13, 1961 filed his answer (Exh. "4-C"). And this
Court after the trial. decided the case on November 26, 1964,
in favor of the defendant, Isaias Batiller and against the
plaintiff (Exh. "4-D").
15

(NOTE: As per Exh. 4-B, which is the Iloilo court of first
instance decision of 26 November 1964 dismissing plaintiff's
therein complaint for ejectment against defendant, the iloilo
court expressly found "that plaintiff's complaint is unjustified,
intended to harass the defendant" and "that the defendant,
Isaias Batiller, has a better right to possess the land in question
described in Psu 155241 (Exh. "3"), Isaias Batiller having
been in the actual physical possession thereof under a claim of
title many years before Francisco Militante sold the land to the
plaintiff-hereby dismissing plaintiff's complaint and ordering
the plaintiff to pay the defendant attorney's fees ....")
B. During the trial of this case on the merit, the plaintiff
will prove by competent evidence the following:
1. That the land he purchased from Francisco Militante
under Exh. "A" was formerly owned and possessed by
Liberato Demontaño but that on September 6, 1919 the land
was sold at public auction by virtue of a judgment in a Civil
Case entitled "Edw J. Pflieder plaintiff vs. Liberato
Demontaño Francisco Balladeros and Gregorio Yulo,
defendants", of which Yap Pongco was the purchaser (Exh.
"1-3"). The sale was registered in the Office of the Register of
Deeds of Iloilo on August 4, 1920, under Primary Entry No.
69 (Exh. "1"), and a definite Deed of Sale was executed by
Constantino A. Canto, provincial Sheriff of Iloilo, on Jan. 19,
1934 in favor of Yap Pongco (Exh. "I"), the sale having been
registered in the Office of the Register of Deeds of Iloilo on
February 10, 1934 (Exh. "1-1").
2. On September 22, 1934, Yap Pongco sold this land to
Francisco Militante as evidenced by a notarial deed (Exh. "J")
which was registered in the Registry of Deeds on May 13,
1940 (Exh. "J-1").
3. That plaintiff suffered damages alleged in his
complaint.
C. Defendants, on the other hand will prove by
competent evidence during the trial of this case the following
facts:
1. That lot No. 2 of the Psu-1552 it (Exh. '5') was
originally owned and possessed by Felipe Batiller, grandfather
of the defendant Basilio Batiller, on the death of the former in
1920, as his sole heir. Isaias Batiller succeeded his father ,
Basilio Batiller, in the ownership and possession of the land in
the year 1930, and since then up to the present, the land
remains in the possession of the defendant, his possession
being actual, open, public, peaceful and continuous in the
concept of an owner, exclusive of any other rights and adverse
to all other claimants.
2. That the alleged predecessors in interest of the
plaintiff have never been in the actual possession of the land
and that they never had any title thereto.
3. That Lot No. 2, Psu 155241, the subject of Free
Patent application of the defendant has been approved.
4. The damages suffered by the defendant, as alleged in
his counterclaim."' 1
The appellate court further related the developments of the
case, as follows:
On August 17, 1965, defendant's counsel manifested in open
court that before any trial on the merit of the case could
proceed he would file a motion to dismiss plaintiff's complaint
which he did, alleging that plaintiff does not have cause of
action against him because the property in dispute which he
(plaintiff) allegedly bought from his father-in-law, Francisco
Militante was the subject matter of LRC No. 695 filed in the
CFI of Iloilo, which case was brought on appeal to this Court
and docketed as CA-G.R. No. 13497-R in which aforesaid
case plaintiff was the counsel on record of his father-in-law,
Francisco Militante. Invoking Arts. 1409 and 1491 of the Civil
Code which reads:
'Art. 1409. The following contracts are inexistent and void
from the beginning:
xxx xxx xxx
(7) Those expressly prohibited by law.
'ART. 1491. The following persons cannot acquire any
purchase, even at a public auction, either in person of through
the mediation of another: .
xxx xxx xxx
(5) Justices, judges, prosecuting attorneys, clerks of
superior and inferior courts, and other officers and employees
connected with the administration of justice, the property and
rights of in litigation or levied upon an execution before the
court within whose jurisdiction or territory they exercise their
respective functions; this prohibition includes the act of
acquiring an assignment and shall apply to lawyers, with
respect to the property and rights which may be the object of
any litigation in which they may take part by virtue of their
profession.'
defendant claims that plaintiff could not have acquired any
interest in the property in dispute as the contract he (plaintiff)
had with Francisco Militante was inexistent and void. (See pp.
22-31, Record on Appeal). Plaintiff strongly opposed
defendant's motion to dismiss claiming that defendant can not
invoke Articles 1409 and 1491 of the Civil Code as Article
1422 of the same Code provides that 'The defense of illegality
of contracts is not available to third persons whose interests
are not directly affected' (See pp. 32-35 Record on Appeal).
On October 18, 1965, the lower court issued an order
disclaiming plaintiffs complaint (pp. 42-49, Record on
Appeal.) In the aforesaid order of dismissal the lower court
practically agreed with defendant's contention that the contract
(Exh. A) between plaintiff and Francism Militante was null
and void. In due season plaintiff filed a motion for
reconsideration (pp. 50-56 Record on Appeal) which was
denied by the lower court on January 14, 1966 (p. 57, Record
on Appeal).
16

Hence, this appeal by plaintiff from the orders of October 18,
1965 and January 14, 1966.
Plaintiff-appellant imputes to the lower court the following
errors:
'1. The lower court erred in holding that the contract of
sale between the plaintiff-appellant and his father-in-law,
Francisco Militante, Sr., now deceased, of the property
covered by Plan Psu-99791, (Exh. "A") was void, not voidable
because it was made when plaintiff-appellant was the counsel
of the latter in the Land Registration case.
'2. The lower court erred in holding that the defendant-
appellee is an interested person to question the validity of the
contract of sale between plaintiff-appellant and the deceased,
Francisco Militante, Sr.
'3. The lower court erred in entertaining the motion to
dismiss of the defendant-appellee after he had already filed his
answer, and after the termination of the pre-trial, when the
said motion to dismiss raised a collateral question.
'4. The lower court erred in dismissing the complaint of
the plaintiff-appellant.'
The appellate court concluded that plaintiffs "assignment of
errors gives rise to two (2) legal posers — (1) whether or not
the contract of sale between appellant and his father-in-law,
the late Francisco Militante over the property subject of Plan
Psu-99791 was void because it was made when plaintiff was
counsel of his father-in-law in a land registration case
involving the property in dispute; and (2) whether or not the
lower court was correct in entertaining defendant-appellee's
motion to dismiss after the latter had already filed his answer
and after he (defendant) and plaintiff-appellant had agreed on
some matters in a pre-trial conference. Hence, its elevation of
the appeal to this Court as involving pure questions of law.
It is at once evident from the foregoing narration that the pre-
trial conference held by the trial court at which the parties with
their counsel agreed and stipulated on the material and
relevant facts and submitted their respective documentary
exhibits as referred to in the pre-trial order, supra, 2 practically
amounted to a fulldress trial which placed on record all the
facts and exhibits necessary for adjudication of the case.
The three points on which plaintiff reserved the presentation
of evidence at the-trial dealing with the source of the alleged
right and title of Francisco Militante's predecessors, supra, 3
actually are already made of record in the stipulated facts and
admitted exhibits. The chain of Militante's alleged title and
right to the land as supposedly traced back to Liberato
Demontaño was actually asserted by Militante (and his
vendee, lawyer and son-in-law, herein plaintiff) in the land
registration case and rejected by the Iloilo land registration
court which dismissed Militante's application for registration
of the land. Such dismissal, as already stated, was affirmed by
the final judgment in 1958 of the Court of Appeals. 4
The four points on which defendant on his part reserved the
presentation of evidence at the trial dealing with his and his
ancestors' continuous, open, public and peaceful possession in
the concept of owner of the land and the Director of Lands'
approval of his survey plan thereof, supra, 5 are likewise
already duly established facts of record, in the land
registration case as well as in the ejectment case wherein the
Iloilo court of first instance recognized the superiority of
defendant's right to the land as against plaintiff.
No error was therefore committed by the lower court in
dismissing plaintiff's complaint upon defendant's motion after
the pre-trial.
1. The stipulated facts and exhibits of record
indisputably established plaintiff's lack of cause of action and
justified the outright dismissal of the complaint. Plaintiff's
claim of ownership to the land in question was predicated on
the sale thereof for P2,000.00 made in 1956 by his father-in-
law, Francisco Militante, in his favor, at a time when
Militante's application for registration thereof had already
been dismissed by the Iloilo land registration court and was
pending appeal in the Court of Appeals.
With the Court of Appeals' 1958 final judgment affirming the
dismissal of Militante's application for registration, the lack of
any rightful claim or title of Militante to the land was
conclusively and decisively judicially determined. Hence,
there was no right or title to the land that could be transferred
or sold by Militante's purported sale in 1956 in favor of
plaintiff.
Manifestly, then plaintiff's complaint against defendant, to be
declared absolute owner of the land and to be restored to
possession thereof with damages was bereft of any factual or
legal basis.
2. No error could be attributed either to the lower court's
holding that the purchase by a lawyer of the property in
litigation from his client is categorically prohibited by Article
1491, paragraph (5) of the Philippine Civil Code, reproduced
supra; 6 and that consequently, plaintiff's purchase of the
property in litigation from his client (assuming that his client
could sell the same since as already shown above, his client's
claim to the property was defeated and rejected) was void and
could produce no legal effect, by virtue of Article 1409,
paragraph (7) of our Civil Code which provides that contracts
"expressly prohibited or declared void by law' are "inexistent
and that "(T)hese contracts cannot be ratified. Neither can the
right to set up the defense of illegality be waived."
The 1911 case of Wolfson vs. Estate of Martinez 7 relied upon
by plaintiff as holding that a sale of property in litigation to
the party litigant's lawyer "is not void but voidable at the
election of the vendor" was correctly held by the lower court
to have been superseded by the later 1929 case of Director of
Lands vs. Abagat. 8 In this later case of Abagat, the Court
expressly cited two antecedent cases involving the same
transaction of purchase of property in litigation by the lawyer
which was expressly declared invalid under Article 1459 of
the Civil Code of Spain (of which Article 1491 of our Civil
Code of the Philippines is the counterpart) upon challenge
thereof not by the vendor-client but by the adverse parties
17

206883782 lawyers-fiduciary-obligations

206883782 lawyers-fiduciary-obligations

Recommandé

Recommandé

Contenu connexe

En vedette

En vedette (6)

Similaire à 206883782 lawyers-fiduciary-obligations

Similaire à 206883782 lawyers-fiduciary-obligations (8)

Plus de homeworkping7

Plus de homeworkping7 (20)

Dernier

Dernier (20)

206883782 lawyers-fiduciary-obligations