PACANA V.

PASCUAL-LOPEZ

Finally, Pacana filed a case with the IBP for Lopezs disbarment. The IBP disbarred
her.

FACTS
Pacana was the Operations Director for Multitel Communications
Corporation (MCC). Multitel was besieged by demand letters from its members and
investors because of the failure of its investment schemes. Pacana earned the ire of
Multitel investors after becoming the assignee of majority of the shares of stock of
Precedent and after being appointed as trustee of a fund amounting to Thirty Million
Pesos (P30,000,000.00) deposited at Real Bank. Multitel later changed its name to
Precedent.
Pacana sought the advice of Lopez who also happened to be a member of
the Couples for Christ, a religious organization where Pacana and his wife were also
active members. From then on, they constantly communicated, with the former
disclosing all his involvement and interests in Precedent and Precedents relation with
Multitel. Lopez gave legal advice to Pacana and even helped him prepare standard
quitclaims for creditors. In sum, Pacana avers that a lawyer-client relationship was
established between him and Lopez although no formal document was executed by
them at that time. There was an attempt to have a formal retainer agreement signed
but it didnt push through.
After a few weeks, Pacana was surprised to receive a demand letter from
Lopez asking for the return and immediate settlement of the funds invested by
Lopezs clients in Multitel. Lopez explained that she had to send it so that her clients
defrauded investors of Multitel would know that she was doing something for them
and assured Pacana that there was nothing to worry about.
Both parties continued to communicate and exchange information regarding
the persistent demands made by Multitel investors against Pacana. Pacana gave
Lopez several amounts, first 900,000; then 1,000,000 to be used in his case. Even
when Pacana went to the states, they continued communicating and he continued
sending her money for the case.
Wary that Lopez may not be able to handle his legal problems, Pacana was
advised by his family to hire another lawyer. When Lopez knew about this, she wrote
to complainant via e-mail, as follows:
Dear Butchie,
Hi! Ok ka lang? Hope you are fine. Sorry if I shocked you but I had to do it as your
friend and lawyer.
-----------I have been informed by Efie that your family is looking at hiring Coco Pimentel. I
know him very well as his sister Gwen is my best friend. I have no problem if you
hire him but I will be hands off. I work differently kasi. -------- Efren Santos will
sign as your lawyer although I will do all the work.
----------Please do not worry. Give me 3 months to make it all disappear. But if you hire
Coco, I will give him the free hand to work with your case. -------- I will stand by
you always. This is my expertise. TRUST me! ---Candy
When he got back to the country, Lopez told Pacana she had earned
P12,500,000.00 as attorneys fees and was willing to give P2,000,000.00 to him in
appreciation for his help. This never happened though. Lopez also ignored Pacanas
repeated requests for accounting. She continued to evade him.

ISSUE
Whether or not Lopez had violated Rule 15.03 on representing conflicting
interests.
HELD
Yes! Attorney Maricel Pascual-Lopez was DISBARRED for representing
conflicting interests and for engaging in unlawful, dishonest and deceitful conduct in
violation of her Lawyers Oath and the Code of Professional Responsibility.
Ratio: Rule 15.03 A lawyer shall not represent conflicting interests except
by written consent of all concerned given after full disclosure of the facts.
Lopez must have known that her act of constantly and actively
communicating with Pacana, who, at that time, was beleaguered with demands from
investors of Multitel, eventually led to the establishment of a lawyer-client relationship.
Lopez cannot shield herself from the inevitable consequences of her actions by
simply saying that the assistance she rendered to complainant was only in the form of
"friendly accommodations," precisely because at the time she was giving assistance
to complainant, she was already privy to the cause of the opposing parties who had
been referred to her by the SEC.
Given the situation, the most decent and ethical thing which Lopez should
have done was either to advise Pacana to engage the services of another lawyer
since she was already representing the opposing parties, or to desist from acting as
representative of Multitel investors and stand as counsel for complainant. She cannot
be permitted to do both because that would amount to double-dealing and violate our
ethical rules on conflict of interest.
Indubitably, Lopez took advantage of Pacanas hapless situation, initially, by
giving him legal advice and, later on, by soliciting money and properties from him.
Thereafter, Lopez impressed upon Pacana that she had acted with utmost sincerity in
helping him divest all the properties entrusted to him in order to absolve him from any
liability. But simultaneously, she was also doing the same thing to impress upon her
clients, the party claimants against Multitel, that she was doing everything to reclaim
the money they invested with Multitel.

AlguravsCityof
Naga

In 1999, the City of Naga demolished a

portion of the house owned by spouses
Antonio and Lorencita Algura for allegedly
being a nuisance as the said portion of the

house was allegedly blocking the road right

of way.
In September, the spouses then sued Naga
for damages arising from the said demolition
(loss of income from boarders), which to the
spouses
is
an
illegal
demolition.
Simultaneous to their complaint was an exparte motion for them to litigate as indigent
litigants. The motion was granted and the
spouses were exempted from paying the
required filing fees.
In February 2000, during pre-trial, the City of
Naga asked for 5 days within which to file a
Motion to Disqualify Petitioners as Indigent
Litigants. Under the Rules of Court (then Sec.
16, Rule 141), a party may be qualified as a
pauper litigant (for those residing outside
Metro Manila) if he submits an affidavit
attesting that a.) his gross monthly income
does not exceed P1,500.00 (now not more
than double the monthly minimum wage)
and b.) he should not own property with an
assessed value of not more than P18,000.00
(now not more than P300k market value).
The City asserted that the combined income
of the Alguras is at least P13,400 which is
way beyond the threshold P1.5k. The City
presented as proof Antonios pay slip as a
policeman
(P10,400)
and
Lorencitas
estimated income from her sari-sari store.

The claim of the spouses that they were

property-less, as proven by the City
Assessors Certification, was not disputed by
the City.
The spouses argued that since the boarding
house was demolished by the city, they only
relied on the income of Antonio which was
barely enough to cover their familys need
like food, shelter, and other basic necessities
for them and their family (they have 6
children).
The judge, however, granted the motion of
the City and so the spouses were disqualified
as pauper-litigants. Subsequently, the case
filed by the spouses against the City was
dismissed for the spouses failure to pay the
required filing fees.
ISSUE: Whether or not the spouses should
be disqualified as pauper-litigants.
HELD: No, there was no hearing on the
matter hence the case was remanded back
to the lower court. In this case, the Supreme
Court reconciled the provisions of Sec. 21,
Rule 3 and Sec. 19, Rule 141 (then Sec. 16,
Rule 141).
Sec. 21, Rule 3, merely provides a general
statement that indigent litigants may not be
required to pay the filing fees. On the other

hand, Sec. 19, Rule 141 provides the specific

standards that a party must meet before he
can be qualified as an indigent party and
thus be exempt from paying the required
fees.
If Sec. 19, Rule 141 (in this case, then Sec.
16, Rule 141) is strictly applied, then the
spouses could not qualify because their
income exceeds P1.5k, which was the
threshold prior to 2000. But if Sec. 21, Rule 3
is to be applied, the applicant (the Spouses)
should be given a chance in a hearing to
satisfy the court that notwithstanding the

evidence presented by the opposing party

(Naga), they have no money or property
sufficient and available for food, shelter and
other basic necessities for their family, and
are thus, qualified as indigent litigants under
said Rule. Therefore, the court should have
conducted a trial in order to let the spouses
satisfy the court that indeed the income
theyre having, even though above the P1.5k
limit, was not sufficient to cover food,
shelter, and their other basic needs.