ROSACIA v.

BULALACAO
(A.C. No. 3745, October 2, 1995)FACTS:On June 1, 1990, by virtue of a written Agreement,
respondent Atty. Benjamin B.Bulalacao was hired as retained counsel of Tacma Phils., Inc.
On October 31, 1990, the lawyer-client relationship between the respondent and the said
corporation was severed. On July, 1991,or nine (9) months after the termination of the
respondent's retainer agreement with Tacma,Phils., Inc, several employees of the
corporation consulted the respondent for the purpose of filing an action for illegal
dismissal. Thereafter, he agreed to handle the case for the saidemployees as against Tacma,
Phils., Inc. by filing a complaint before the National LaborRelations Commission, and
appearing in their behalf. On that account, Complainant Cynthia B.Rosacia, president of the
said corporation filed a complaint for disbarment dated October 25,1991, against
respondent Atty. Benjamin B. Bulalacao. The Court in a resolution resolved torefer the case
to the Integrated Bar of the Philippines for investigation, report andrecommendation. The
abovementioned facts were undisputed as examined by the IBP. Therespondent even filed
a motion for reconsideration wherein he admitted that he did commit anact constituting a
grave misconduct, if not outright violation of his attorneys oath and pleadingfor the courts
compassion and leniency to reduce the penalty of 3 months suspension to a fine
oradmonition.
ISSUE:Whether or not respondent breached his oath of office for representing the
employees of his former client, after the termination of their attorney-client relationship.
HELD:Yes, The court agrees with the findings of the IBP that the respondent breaches his
oathof office. The respondent violated Canon 21 of the Code of Professional Responsibility,
which provides that a lawyer shall preserve the confidences of his client even after the
attorney-client relation is terminated. The Court reiterates that an attorney owes loyalty to
his client not only in the case in which he has represented him but also after the relation of
attorney and client has terminated as it is not good practice to permit him to defend
another case for other person againsthis former client under the pretext that the case is
distinct from, and independent of the formercase. It is a measure to avoid the appearance
of treachery and double dealing for only then canlitigants be encouraged to entrust their
secrets to their attorneys. A lawyer owes fidelity to thecause of his client and he ought to be
mindful of the trust and confidence reposed in him. Anattorney becomes familiar with all
the facts as well as the weak and strong points of the case. Noopportunity must be given
attorneys to take advantage of the secrets of clients obtained while theconfidential relation
of attorney and client exists. Otherwise, the legal profession will suffer bythe loss of the
confidence of the people. Thus, the respondent plea for leniency cannot be grantedbecause
a lawyer starting to establish his stature in the legal profession must dutifully abide bythe
norms of conduct of the profession. Hence, the respondent is suspended from the practice
of law for 3 months.

Lorenzana Food Corporation (LFC) vs. Daria

Facts: Atty. Daria was hired by Lorenzana Food Corporation as its legal counsel and was
eventually designated as its personal manager. In the course of his employment with the
corp he was involved in two labor cases:
Hanopol case - A certain Veronica Hanopol who was allegedly illegally dismissed, filed a
case against him. During the initial hearing, Daria and Hanopol agreed to an amicable
settlement and set a date for the next meeting.
This was reset after Hanopol did not show up and the Labor Arbiter reset the date further
to June 20, 1983. On that date, Daria was in another hearing and he moved to postpone the
Hanopol hearing through a phone message but the Labor Arbiter did not receive it, hence
he considers the case as submitted for decision based on Hanopols complaint and affidavit.
Daria appealed to the NLRC and the case was remanded to the Labor Arbiter for further
proceedings. Attempts to have an amicable settlement proved futile. By the time the final
hearing was set, Daria had already resigned from the company and no one appeared for the
corp during the Hanopol hearing. Labor arbiter revived his earlier decision awarding
Hanopol with sum of P6,469.80 in labor benefits. New counsel for the corp appealed to the
judgment and this was remanded for further proceedings.
San Juan case - Roberto San Juan is an employee of the corp who was accused of double
liquidation and unliquidated cash advances. He was asked to submit a written explanation
and was placed on preventive suspension. He was required to restitute said amount to the
company but upon failure to do so, a complaint of estafa was filed against him. San Juan
resigned and sought the assistance of Daria in preparing his counteraffidavit.
Because of these incidents, LFC files an administrative charge against Daria for negligence
and betrayal of former clients confidences.
Issue: Do the acts of Atty. Daria constitute negligence and betrayal of his former clients
confidence?
Held: Court says Yes, Daria violated Code of Professional Responsibility and betrayed the
confidences of his former client. He is suspended from the practice of law for 6 months.
Canon 18 provides that a lawyer shall serve his client with competence and diligence; Rule
18.03 provides that a lawyer shall not neglect a legal matter entrusted to him and his
negligence in connection therewith shall render him liable.
Because Daria had a responsibility to attend the two scheduled hearings he missed and had
he filed the required position paper for the corporation then at least there would have been
no delay in the resolution of the case which the court states could have been in favor of the

corporation. The delay was prejudicial to LFC because it deprived successor counsel of the
time which he should be devoting to other cases of LFC instead of the work left by Daria.
The respondents claim that he was able to persuade NLRC on appeal to set aside the first
decision is no matter. Negligence is apparent in the conduct of Daria.
As for preparing the counter-affidavit of San Juan, the court is not convinced with his denial
of his participation in the preparation. His signature was placed on the document and it is
clear that the contention of Daria is a mere afterthought.
An attorney owes loyalty to his client not only in the case in which he has represented him
but also for the relation of attorney and client has terminated. It is not good practice to
permit him afterwards to defend in another case other persons against his former client
under the pretext that the case is distinct and independent of the former case.

Adarne vs Aldaba
respondent filed a disbarment case onthe ground of gross negligence against Atty.
Aldababecause, as accdg to the petitioner, the lawyer onlyappeared for the special
appearance and from then on,left him hanging. But the SC held that the petitioner shouldbe
the one to be blamed for having engaged the servicesof several lawyers to handle his case
w/o formallywithdrawing the authority he had given to them to appear in his behalf as to
place the responsibility upon therespondent lawyer in this case. the respondent
honestlybelieved that he had appeared for the complainant only for a special purpose and
that the complainant had agreed tocontact his attorney of record to handle his case after
thehearing of October 23, 1964, so that he did nothing moreabout it.
It was neither gross negligence nor omission tohave entertained such belief. An attorney is
not bound toexercise extraordinary diligence, but only a reasonabledegree of care and skill,
having reference to the character of the business he undertakes to do. Prone to err like
anyother human being, he is not answerable for every error or mistake, and will be
protected as long as he acts honestlyand in good faith to the best of his skill and
knowledge.(canon 18

G.R. NO. 189122, March 17, 2010 Leviste v. CA, et al. Digest Corono, J.:

FACTS:
Charged with the murder of Rafael de las Alas, petitioner Jose Antonio Leviste was
convicted by the Regional Trial Court of Makati City for the lesser crime of homicide and
sentenced to suffer an indeterminate penalty of six years and one day of prision mayor as
minimum to 12 years and one day of reclusion temporal as maximum.
He appealed his conviction to the Court of Appeals. Pending appeal, he filed an urgent
application for admission to bail pending appeal, citing his advanced age and health
condition, and claiming the absence of any risk or possibility of flight on his part.
The Court of Appeals denied petitioners application for bail. It invoked the bedrock
principle in the matter of bail pending appeal, that the discretion to extend bail during the
course of appeal should be exercised with grave caution and only for strong reasons.
Petitioners motion for reconsideration was denied.
Petitioner quotes Section 5, Rule 114 of the Rules of Court was present. Petitioners
theory is that, where the penalty imposed by the trial court is more than six years but not
more than 20 years and the circumstances mentioned in the third paragraph of Section 5
are absent, bail must be granted to an appellant pending appeal.

ISSUE:
Whether the discretionary nature of the grant of bail pending appeal mean that bail should
automatically be granted absent any of the circumstances mentioned in the third
paragraph of Section 5, Rule 114 of the Rules of Court?

HELD:
Petitioners stance is contrary to fundamental considerations of procedural and substantive
rules.
Petitioner actually failed to establish that the Court of Appeals indeed acted with grave
abuse of discretion. He simply relies on his claim that the Court of Appeals should have

granted bail in view of the absence of any of the circumstances enumerated in the third
paragraph of Section 5, Rule 114 of the Rules of Court.
We disagree.
Pending appeal of a conviction by the Regional Trial Court of an offense not punishable by
death, reclusion perpetua, or life imprisonment, admission to bail is expressly declared to
be discretionary.
Retired Court of Appeals Justice Oscar M. Herrera, another authority in remedial law, is of
the same thinking:
Bail is either a matter of right or of discretion. It is a matter of right when the offense
charged is not punishable by death, reclusion perpetua or life imprisonment. On the other
hand, upon conviction by the Regional Trial Court of an offense not punishable death,
reclusion perpetua or life imprisonment, bail becomes a matter of discretion.
Similarly, if the court imposed a penalty of imprisonment exceeding six (6) years
then bail is a matter of discretion, except when any of the enumerated circumstances under
paragraph 3 of Section 5, Rule 114 is present then bail shall be denied. (emphasis supplied)
In the first situation, bail is a matter of sound judicial discretion. This means that, if
none of the circumstances mentioned in the third paragraph of Section 5, Rule 114 is
present, the appellate court has the discretion to grant or deny bail.
On the other hand, in the second situation, the appellate court exercises a more
stringent discretion, that is, to carefully ascertain whether any of the enumerated
circumstances in fact exists. If it so determines, it has no other option except to deny or
revoke bail pending appeal.
Given these two distinct scenarios, therefore, any application for bail pending appeal
should be viewed from the perspective of two stages: (1) the determination of discretion
stage, where the appellate court must determine whether any of the circumstances in the
third paragraph of Section 5, Rule 114 is present; this will establish whether or not the
appellate court will exercise sound discretion or stringent discretion in resolving the
application for bail pending appeal and (2) the exercise of discretion stage where, assuming
the appellants case falls within the first scenario allowing the exercise of sound discretion,
the appellate court may consider all relevant circumstances, other than those mentioned in
the third paragraph of Section 5, Rule 114, including the demands of equity and justice; on
the basis thereof, it may either allow or disallow bail.

A finding that none of the said circumstances is present will not automatically result in the
grant of bail. Such finding will simply authorize the court to use the less stringent sound
discretion approach.
However, judicial discretion has been defined as choice. Choice occurs where,
between two alternatives or among a possibly infinite number (of options), there is
more than one possible outcome, with the selection of the outcome left to the decision
maker. On the other hand, the establishment of a clearly defined rule of action is the end of
discretion. Thus, by severely clipping the appellate courts discretion and relegating that
tribunal to a mere fact-finding body in applications for bail pending appeal in all instances
where the penalty imposed by the trial court on the appellant is imprisonment exceeding
six years, petitioners theory effectively renders nugatory the provision that upon
conviction by the Regional Trial Court of an offense not punishable by death, reclusion
perpetua, or life imprisonment, admission to bail is discretionary.
The aforementioned provisions were reproduced as Sections 3 to 6, Rule 114 of the
1964 Rules of Criminal Procedure and then of the 1985 Rules of Criminal Procedure. They
were modified in 1988 to read as follows:
Sec. 3. Bail, a matter of right; exception. All persons in custody, shall before final
conviction be entitled to bail as a matter of right, except those charged with a capital
offense or an offense which, under the law at the time of its commission and at the time of
the application for bail, is punishable by reclusion perpetua, when evidence of guilt is
strong.
Hence, for the guidelines of the bench and bar with respect to future as well as
pending cases before the trial courts, this Court en banc lays down the following policies
concerning theeffectivity of the bail of the accused, to wit:
2) When an accused is charged with a capital offense or an offense which under the law at
the time of its commission and at the time of the application for bail is punishable by
reclusion perpetua and is out on bail, and after trial is convicted by the trial court of a
lesser offense than that charged in the complaint or information, the same rule set forth in
the preceding paragraph shall be applied;
Amendments were further introduced in Administrative Circular No. 12-94 dated
August 16, 1994 which brought about important changes in the said rules as follows:
SECTION 5. Bail, when discretionary. Upon conviction by the Regional Trial Court
of an offense not punishable by death, reclusion perpetua or life imprisonment, the court,
on application, may admit the accused to bail.
Denial of bail pending appeal is a matter of wise discretion.

Section 13, Article II of the Constitution provides:

SEC. 13. All persons, except those charged with offenses punishable by reclusion
perpetua when evidence of guilt is strong, shall, before conviction, be bailable by sufficient
sureties, or be released on recognizance as may be provided by law. x x x (emphasis
supplied)
After conviction by the trial court, the presumption of innocence terminates and,
accordingly, the constitutional right to bail ends. From then on, the grant of bail is subject
to judicial discretion. At the risk of being repetitious, such discretion must be exercised
with grave caution and only for strong reasons.
WHEREFORE, the petition is hereby DISMISSED.

Retuya v. GorduizFacts:

Ana F. Retuya filed for a claim of workmens compensation against Eastern Shipping Lines,
the employer of her husband who died in 1968.
In a decision by the Workmens Compensation Unit at Tacloban City, Ana was awarded a
sum for compensation benefits, medical andhospitalization expenses, burial expenses, and
attorneys fees of Atty.Inego Gorduiz (P300).
In the appeal, a compromise claim was proposed, and subsequentlyaccepted by Ana. The
employer paid a reduced award.
Ana sent the receipt and release, wherein she also explained that Gorduizdid not sign the
joint motion to dismiss the claim because he wanted 20% of the award as his attorneys
fees. She was willing to give him 10% only.
After cashing the check, she was not able to contact Gorduiz and pay hisfee. Unexpectedly,
she was served with a warrant of arrest. To avoiddetention, she posted bail.
It turned out that Atty. Gorduiz executed an affidavit stating that Ana had misappropriated
his attorneys fees amounting to three hundred pesos, that he had demanded payment but
she had refusedto make payment. So she went to Cebu.
On the basis of such affidavit, the acting chief of police filed against Ana acomplaint for
estafa.
She filed a motion to quash where she explained that she did not accedeto his demand. She
stated that the estafa case was filed merely toharass her.
The motion to quash was denied and Judge Equipilag required Ana to produce a copy of the
decision awarding her workmens compensation.
The case of estafa was not tried. Instead, Atty. Diola, lawyer of Ana,offered Gorduiz a sum of
five hundred pesos as settlement of the case.The offer was accepted.
The dismissal was eventually released.
Despite the dismissal, Ana felt aggrieved and asked for the disbarment orsuspension of
Atty. Gorduiz and Judge Equipilag.
Held/Ratio:

Court found no justification in suspending respondent judge. He ishowever admonished to

be more prudent.
In the case of Gorduiz, the Solicitor General, disagreeing with therecommendation of the
provincial fiscal of Southern Leyte, filed in this court a case against Gorduiz a complaint
where he prayed that Gorduiz be suspended for six months because in filing the estafa case,
he hadpromoted a groundless suit.
Ana testified that she was willing to pay Gorduiz an amount of P650 but he demanded a
bigger amount.He then filed an estafa case against her,which waslater dismissed when Ana
paid Gorduiz a sum of P500.
In his testimony, Gorduiz denied that he demanded attorneys fees higher than P300. He
explained that he filed the estafa case because after Anareceived the payment of the award,
she did not turn it over desmisepromises and demands.
He further declared that it was only filed to evade payment of attorneys fees. He also filed
the case because he thought that Ana had absconded when she stayed in Cebu for a long
time. He also said that he used his own money in looking for evidence in the workmens
compensation case.
The Court finds justification for suspending the respondent.
The respondent acted precipitately in filing a criminal action against his client
for the supposed misappropriation.It is not clear that theclient had swindled him, and there
is basis that contrary to hislawyers oath, he had filed a suit against her and had harassed
and embarrassed her.

DIRECTOR OF LANDS vs. ABABA (1979)

FACTS:
Atty. Alberto Fernandez is the adverse claimant of Lots No. 5600 and 5602 in Cebu.
Fernandez was retained as counsel by petitioner Maximo Abarquez in a civil case for the
annulment of a contract of sale with right of repurchase andfor the recovery of the land for
said lots against Agripina Abarquez.
The CFI of Cebu ruled against Maximo so he appealed to the CA.
Maximo litigated as a pauper in the lower court and engaged the services of Fernandez on
a contingent basis, liable to compensate his lawyer forthe appeal by obliging himself to give
1/2 of whatever he might recover from the 2 lots should the appeal prosper.
Lots 5600 and 5602 were part of the estate of Maximos deceased parents, which were
partitioned to Maximo and Agripina, his sister, as heirs.
Subsequently, CA annulled the deed of pacto de retro and ruled in favor of Maximo. A TCT
was issued in Maximos name over his adjudged share.
Atty. Fernandez waited for Maximo to comply with his obligation under the executed
document by him to deliver 1/2 of the recovered land.
Maximo refused to comply with his obligation and instead offered to sell the whole land to
petitioner-spouses Larrazabal.
Atty. Fernandez took stops to protect his interest by filing to annotate an attorneys lien
on the TCT and by notifying the Larrazabal spouses of hisclaim over 1/2 portion of the
land.
Notwithstanding the annotation of the adverse claim, Maximo conveyed by deed of
absolute sale 2/3 of the lands to spouses Larrazabal.
Spouses Larrazabal subsequently filed for cancellation of adverse claim on the new TCT.
Atty. Fernandez filed the present appeal to deny the petition for cancellation of adverse
claim.
ISSUE:
WON the registration of the adverse claim of Atty. Fernandez was null since his interest
was based on a contract for a contingent fee asMaximos counsel, prohibited under Art
1491 of the NCC?HELD:

NO.A contract for a contingent fee is valid. There was no contract of sale on the property
which is the subject of litigation.
Art 1491provides that the following persons cannot acquire by purchase even at a public
or judicial auction, either in person or through the petitionof another. (5) Justices, judges,
prosecuting attorneys, clerks of superior and inferior courts and other employees
connected with the administrationof justice, the property and rights in litigation or levied
upon an execution before the court within whose jurisdiction or territory they exercise
theirrespective functions; this prohibition includes the act of acquiring by 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.
Art1491only prohibits the sale or assignment between the lawyer and his client, of
property which is the subject of litigation. In other words, for theprohibition to operate, the
sale or transfer of the property must take place during the pendency of the litigation
involving the property.
Under American Law, the prohibition does not apply to cases where after completion of
litigation the lawyer accepts on account of his fee, an interest the assets realized by the
litigation. There is a clear distraction between such cases and one in which the lawyer
speculates on the outcomeof the matter in which he is employed.
A contract for a contingent fee is not covered by Article 1491because the transfer or
assignment of the property in litigation takes effect only after the finality of a favorable
judgment. In the instant case, the attorney's fees of Atty. Fernandez, consisting of 1/2 of
whatever Maximo might recoverfrom his share in the lots in question, is contingent upon
the success of the appeal.
Hence, the payment of the attorney's fees, that is, the transfer or assignment of of the
property in litigation will take place only if the appealprospers. Therefore, the transfer
actually takes effect after the finality of a favorable judgment rendered on appeal and not
during the pendency ofthe litigation involving the property in question.
Under the Canons of Professional Ethics, Canon 10 prohibits a lawyer from purchasing
any interest in the subject matter of the litigation which heis conducting. Canon 13, on the
other hand, allowed a reasonable contingent fee contract
In the present case, there is no iota of proof to show that Atty. Fernandez had exerted any
undue influence or perpetrated fraud on, or had in anymanner taken advantage of his
client, Maximo Abarquez. And, the compensation of one-half of the lots in question is not
excessive norunconscionable considering the contingent nature of the attorney's fees.

 The contract for a contingent fee, being valid, vested in Atty. Fernandez an interest or
right over the lots in question to the extent of one-half thereof.Said interest became vested
in Atty. Fernandez after the case was won on appeal because only then did the assignment
of the 1/2 portion of thelots in question became effective and binding.
The interest or claim cannot be registered as an attorney's charging lien. The lower court
was correct in denying the motion to annotate the attomey'slien. A charging lien under
Section 37, Rule 138 of the Revised Rules of Court is limited only to money judgments and
not to judgments for theannulment of a contract or for delivery of real property as in the
instant case.
Therefore, as an interest in registered land, the only adequate remedy open to Atty.
Fernandez is to register such interest as an adverse claim.
The 1/2 interest of Atty. Fernandez in the lots in question should therefore be respected.
Indeed, he has a better right than petitioner-spousesLarrazabal. They purchased their 2/3
interest in the lots in question with the knowledge of the adverse claim of Atty. Fernandez.
The adverse claim was annotated on the old TCT and was later annotated on the new TCT
issued to them. Having purchased the property with the knowledge of theadverse claim,
they are therefore in bad faith. Consequently, they are estoppedfrom questioning the
validity of the adverse claim.
The SC AFFIRMED the lower court ruling to deny petition for cancellation of adverse
claim.