LEGAL ETHICS CASE DIGESTS
A.C. No. 10579 Legal Ethics Borrowing From Clients Not HELD: No. The recommended penalty of 3 months suspension is
Appropriate
Civil Claims Cannot Be Litigated in a Disbarment Suit
In 2009, Erlinda Foster engaged the services of Atty. Jaime Agtang
in a realty dispute in Ilocos Norte. Agtangs acceptance fee was
P20,000.00 plus P5,000.00 for incidental expenses.
For the case, Agtang collected P150,000.00 from Foster as filing
fee. He also advised Foster to shell out a total of P50,000.00 for
them to bribe the judge and get a favorable decision. Although
reluctant, Foster gave in to Agtangs demands.
On various occasions, Agtang borrowed money from Foster for his
personal use, i.e., car repair. Such loan amounted to P122,000.00.
Foster, being prudent, asked for receipts for all funds she handed
over to Agtang.
Later however, Foster learned that she lost the case due to
Agtangs negligence and incompetence in drafting the complaint.
She also found out that the filing fee therefor was only P22,410
(not P150k). Further, it turned out that Agtang was once the lawyer
of the opposing party. When she asked Agtang to return her the
balance, the said lawyer failed to do so hence, she filed an
administrative complaint against Agtang.
The IBP Board of Governors (IBP-BOG) eventually ordered Agtang
to return the balance of the filing fee (P127,590.00) as well as the
money he borrowed from Foster (P122,000.00). It was also
recommended that Agtang be suspended for three months only.
ISSUE: Whether or not the recommendation by the IBP-BOG is
proper.
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Justice Hofilena
too light. Agtang was disbarred by the Supreme Court.
Rule 1.0, Canon 1 of the Code of Professional Responsibility,
provides that a lawyer shall not engage in unlawful, dishonest,
immoral or deceitful conduct.
In this case, Agtang is guilty of engaging in dishonest and deceitful
conduct, both in his professional and private capacity. As a lawyer,
he clearly misled Foster into believing that the filing fees for her
case were worth more than the prescribed amount in the rules, due
to feigned reasons such as the high value of the land involved and
the extra expenses to be incurred by court employees. In other
words, he resorted to overpricing, an act customarily related to
depravity and dishonesty.
When asked to return the balance, he failed and refused to do so
and even had the temerity that it was all the clients idea. . A
lawyers failure to return upon demand the funds held by him on
behalf of his client gives rise to the presumption that he has
appropriated the same for his own use in violation of the trust
reposed in him by his client. Such act is a gross violation of general
morality as well as of professional ethics. It impairs public
confidence in the legal profession and deserves punishment.
It is clear that Agtang failed to fulfill this duty. He received various
amounts from Foster but he could not account for all of them.
Worse, he could not deny the authenticity of the receipts presented
by Foster.
Rule 16.04, Canon 16 of the Code of Professional
Responsibility states that a lawyer shall not borrow money from
his client unless the clients interests are fully protected by the
nature of the case or by independent advice. Neither shall a lawyer
lend money to a client except, when in the interest of justice, he
 LEGAL ETHICS CASE DIGESTS
has to advance necessary expenses in a legal matter he is
handling for the client.
In the first place, Agtang should have never borrowed from Foster,
his client. Second, his refusal to pay reflects his baseness.
Deliberate failure to pay just debts constitutes gross misconduct,
for which a lawyer may be sanctioned with suspension from the
practice of law. Lawyers are instruments for the administration of
justice and vanguards of our legal system. They are expected to
maintain not only legal proficiency, but also a high standard of
morality, honesty, integrity and fair dealing so that the peoples faith
and confidence in the judicial system is ensured. They must, at all
times, faithfully perform their duties to society, to the bar, the courts
and their clients, which include prompt payment of financial
obligations.
The acts of the Agtang constitute malpractice and gross
misconduct in his office as attorney. His incompetence and
appalling indifference to his duty to his client, the courts and
society render him unfit to continue discharging the trust reposed in
him as a member of the Bar.
2 | Block C 2012
Justice Hofilena
SIDE ISSUE: May the Court order Agtang to return the money he
borrowed from Foster?
No. The Court held that it cannot order the lawyer to return money
to complainant if he or she acted in a private capacity because its
findings in administrative cases have no bearing on liabilities which
have no intrinsic link to the lawyers professional engagement. In
disciplinary proceedings against lawyers, the only issue is whether
the officer of the court is still fit to be allowed to continue as a
member of the Bar. The only concern of the Court is the
determination of respondents administrative liability. Its findings
have no material bearing on other judicial actions which the parties
may choose against each other. To rule otherwise would in effect
deprive respondent of his right to appeal since administrative
cases are filed directly with the Court.