Nakpil vs Valdes [A.C. No. 2040.

March 4, 1998]
16OCT
Ponente: PUNO, J. FACTS: Jose Nakpil, husband of the complainant, became interested in purchasing a summer residence in Moran Street, Baguio City. For lack of funds, he requested respondent to purchase the Moran property for him. They agreed that respondent would keep the property in thrust for the Nakpils until the latter could buy it back. Pursuant to their agreement, respondent obtained two (2) loans from a bank which he used to purchase and renovate the property. Title was then issued in respondents name. The ownership of the Moran property became an issue in the intestate proceedings when Jose Nakpil died. Respondent acted as the legal counsel and accountant of his widow. Respondent excluded the Moran property from the inventory of Joses estate and transf erred his title to the Moran property to his company, the Caval Realty Corporation. ISSUE: Whether or not there was conflict of interest between the respondent Atty. Valdes and the complainant. HELD: YES. Respondent was suspended from practice of law for one (1) year. RATIO: [T]here is no question that the interests of the estate and that of its creditors are adverse to each other. Respondents accounting firm prepared the list of assets and liabilities of the estate and, at the same time, computed the claims of two creditors of the estate. There is clearly a conflict between the interest of the estate which stands as the debtor, and that of the two claimants who are creditors of the estate. [R]espondent undoubtedly placed his law firm in a position where his loyalty to his client could be doubted. In the estate proceedings, the duty of respondents law firm was to contest the claims of these two creditors but which claims were prepared by respondents accounting firm. Even if the claims were valid and did not prejudice the estate, the set-up is still undesirable. The test to determine whether there is a conflict of interest in the representation is probability, not certainty of conflict. It was respondents duty to inhibit either of his firms from said proceedings to avoid the probability of conflict of interest. Public confidence in law and lawyers may be eroded by the irresponsible and improper conduct of a member of the bar. Thus, a lawyer should determine his conduct by acting in a manner that would promote public confidence in the integrity of the legal profession. Members of the bar are expected to always live up to the standards embodied in the Code of Professional Responsibility as the relationship between an attorney and his client is highly fiduciary in nature and demands utmost fidelity and good faith. In the case at bar, respondent

exhibited less than full fidelity to his duty to observe candor, fairness and loyalty in his dealings and transactions with his clients.

Canon 15 Case Digest

CANON 15: RUTHIE LIM-SANTIAGO vs ATTY. CARLOS SAGUCIO A.C. No. 6705 March 31, 2006 FACTS: Respondent, atty Sagucio was a former Personnel manager and Counsel of Taggat Industries Inc. Thereafter in 1992, he was appointed as Asst. Provincial prosecutor of Tuguegarao Cagayan . Employees of Taggat filed criminal charges against the complainant who took over the management and control of Taggat, withheld the payment of their wages and salaries without a valid cause. The complainant charges respondent with the engaging in private practice of law while working as a government prosecutor and for violation of Rule 15.03 of CPR. ISSUES: 1. Whether or not the respondent violated Rule 15.03 of CPR. 2. Whether or not being a former lawyer of Taggat posits conflict of interests with his work as Asst. Provincial Prosecutor HELD: The Court finds that there is no conflict of interest on the part of the respondent when he handled the preliminary investigation of the criminal charges filed by the Taggat Employees. The issue of the matter of the criminal complaint was pertaining to the withholding of the wages and salaries of the Taggat employees which occurred from April 1, 1996 to July 15, 1997. Evidently, the respondent was no longer connected with the Taggat Inc during such period since he is working as Assistant Provincial Prosecutor since 1992. Should there be apparent conflict of interest, it must be supported by sufficient evidence that Taggat, respondents former client, used any confidential information from his preceding employment with Complainant in resolving the filed criminal complaint. As the former Personnel Manager and Retained Counsel of Taggat together with the case he handled as government t prosecutor was labor-related case which fact, is not a sufficient basis to charge respondent for representing conflicting interests. The Court emphasized that a lawyers absolute duty to his former client does not cover transactions that...

Junio v Grupo
Facts: Rosario Junio entrusted to Atty. Salvador Grupo, P25,000 to be used in the redemption of a property in Bohol. For no reason at all, Atty. Grupo did not redeem the property so the property was forfeited. Because of this, Junio wanted the money back but Grupo refused to refund. Instead, Grupo requested that he use the money to help defray his childrens educational expenses. It was a personal request to which Grupo executed a PN. He maintains that the family of the Junio and Grupo were very close since Junios sisters served as Grupos household helpers for many years. Grupo also stated that the basis of his rendering legal services was purely gratuitous or an act of a friend for a friend with consideration involved. He concluded that there was no attyclient relationship existing between them.

The case was referred to the IBP and found Grupo liable for violation of Rule 16.04 of the Code of Profesisonal Responsibility which forbids lawyers from borrowing money from their clients. The IBP Board of Governors recommended that he be suspended indefinitely from the practice of law. Grupo filed a motion for reconsideration.

Issue: Whether or not there was an atty-client relationship.

Held: Yes. If a person, in respect to his business affairs, consults with an attorney in his professional capacity and the attorney voluntarily permits in such consultation, then the professional employment must be regarded as established. Having gained dominance over Junio by virtue of such long relation of master and servant, Grupo took advantage of his influence by not returning the money. Grupo has committed an act which falls short of the standard conduct of an attorney. If an ordinary borrower of money is required by law to repay his loan, it is more so in the case of a lawyer whose conduct serves as an example.

*SC orders Grupo suspended from the practice of law for a month and to pay Junio within 30 days with interest at the legal rate. * Note: 5 yrs. has already passed since the loan.