392 Malvar v Kraft Food, AUTHOR:

G.R. No. 183952, September 9, 2013 Although the practice of law is not a business, an attorney is entitled to be
TOPIC: Interference with contractual relations properly compensated for the professional services rendered for the client, who
is bound by her express agreement to duly compensate the attorney. The client
may not deny her attorney such just compensation.

FACTS: (chronological order)

Note: The case initially concerned the execution of a final decision of the Court of Appeals (CA) in a labor litigation, but has mutated into a dispute over attorney's
fees between the winning employee and her attorney after she entered into a compromise agreement with her employer under circumstances that the attorney
has bewailed as designed to prevent the recovery ofjust professional fees.

Malvar filed a complaint for illegal suspension and illegal dismissal against KFPI and Bautista in the National Labor Relations Commission (NLRC). The Labor
Arbiter found and declared her suspension and dismissal illegal, and ordered her reinstatement, and the payment of her full backwages, inclusive of allowances
and other benefits, plus attorney’s fees.

NLRC and CA affirmed the decision of the Labor Arbiter. After the judgment in her favor became final and executory on March 14, 2006, Malvar moved for
the issuance of a writ of execution but the execution failed due to questionable computation of the award. Malvar requested for the 2nd issuance of the writ of
execution and was partially complied with but with protest on the part of Kraft by filing a TRO for further execution since the computation is incorrect. CA
ruled in favor of Kraft. Thus, Malvar appealed. While her appeal was pending in this Court, Malvar and the respondents entered into a compromise agreement.

Thereafter, Malvar filed an undated Motion to Dismiss/Withdraw Case,16 praying that the appeal be immediately dismissed/withdrawn in view of the
compromise agreement, and that the case be considered closed and terminated.

Before the Court could act on Malvar’s Motion to Dismiss/Withdraw Case, the Court received on February 15, 2011 a so-called Motion for Intervention to
Protect Attorney’s Rights.

The Intervenor indicated that Malvar’s precipitate action had baffled, shocked and even embarrassed the Intervenor, because it had done everything legally
possible to serve and protect her interest. It added that it could not recall any instance of conflict or misunderstanding with her, for, on the contrary, she had
even commended it for its dedication and devotion to her case. According to the Intervenor, it was certain that the compromise agreement was authored by the
respondents to evade a possible loss of P182,000,000.00 or more as a result of the labor litigation, but considering the Intervenor’s interest in the case as well as
its resolve in pursuing Malvar’s interest, they saw the Intervenor as a major stumbling block to the compromise agreement that it was then brewing with her.
Obviously, the only way to remove the Intervenor was to have her terminate its services as her legal counsel. This prompted the Intervenor to bring the matter
to the attention of the Court to enable it to recover in full its compensation based on its written agreement with her.

Opposing the Motion for Intervention,28 Malvar stresses that there was no truth to the Intervenor’s claim to defraud it of its professional fees; that the Intervenor
lacked the legal capacity to intervene because it had ceased to exist after Atty. Marwil N. Llasos resigned from the Intervenor and Atty. Richard B. Dasal became
barred from private practice upon his appointment as head of the Legal Department of the Small Business Guarantee and Finance Corporation, a government
subsidiary; and that Atty. Llasos and Atty. Dasal had personally handled her case.

Malvar adds that even assuming, arguendo, that the Intervenor still existed as a law firm, it was still not entitled to intervene for the following reasons, namely:
firstly, it failed to attend to her multiple pleas and inquiries regarding the case, as when communications to the Intervenor through text messages were left
unanswered; secondly, maintaining that this was a justifiable cause to dismiss its services, the Intervenor only heeded her repeated demands to withdraw from
the case when Atty. Dasal was confronted about his appointment to the government subsidiary; thirdly, it was misleading and grossly erroneous for the Intervenor
to claim that it had rendered to her full and satisfactory services when the truth was that its participation was strictly limited to the preparation, finalization and
submission of the petition for review with the Supreme Court; and finally, while the Intervenor withdrew its services on October 5, 2009, the compromise
agreement was executed with the respondents on December 9, 2010 and notarized on December 14, 2010, after more than a year and two months, dispelling any
badge of bad faith on their end.

ISSUE(S): Whether or not the Motion for Intervention to protect attorney’s rights can prosper, and, if so, how much could it recover as attorney’s fees.
HELD: Yes.

RATIO:
A compromise agreement is a contract, whereby the parties undertake reciprocal obligations to avoid litigation, or put an end to one already commenced. The
client may enter into a compromise agreement with the adverse party to terminate the litigation before a judgment is rendered therein. If the compromise
agreement is found to be in order and not contrary to law, morals, good customs and public policy, its judicial approval is in order.33 A compromise agreement,
once approved by final order of the court, has the force of res judicata between the parties and will not be disturbed except for vices of consent or forgery.

A client has an undoubted right to settle her litigation without the intervention of the attorney, for the former is generally conceded to have exclusive control
over the subject matter of the litigation and may at any time, if acting in good faith, settle and adjust the cause of action out of court before judgment, even
without the attorney’s intervention.

It is important for the client to show, however, that the compromise agreement does not adversely affect third persons who are not parties to the agreement.

By the same token, a client has the absolute right to terminate the attorney-client relationship at any time with or without cause.37 But this right of the client is
not unlimited because good faith is required in terminating the relationship. The limitation is based on Article 19 of the Civil Code, which mandates that “[e]very
person must, in the exercise of his rights and in the performance of his duties, act with justice, give everyone his due, and observe honesty and good faith.” The
right is also subject to the right of the attorney to be compensated. This is clear from Section 26, Rule 138 of the Rules of Court, which provides:
Section 26. Change of attorneys. - An attorney may retire at any time from any action or special proceeding, by the written consent of his client filed
in court. He may also retire at any time from an action or special proceeding, without the consent of his client, should the court, on notice to the client
and attorney, and on hearing, determine that he ought to be allowed to retire. In case of substitution, the name of the attorney newly employed shall
be entered on the docket of the court in place of the former one, and written notice of the change shall be given to the adverse party.

A client may at any time dismiss his attorney or substitute another in his place, but if the contract between client and attorney has been reduced to
writing and the dismissal of the attorney was without justifiable cause, he shall be entitled to recover from the client the full compensation stipulated
in the contract. However, the attorney may, in the discretion of the court, intervene in the case to protect his rights. For the payment of his compensation
the attorney shall have a lien upon all judgments for the payment of money, and executions issued in pursuance of such judgment, rendered in the
case wherein his services had been retained by the client. (Bold emphasis supplied)

In fine, it is basic that an attorney is entitled to have and to receive a just and reasonable compensation for services performed at the special instance and request
of his client. The attorney who has acted in good faith and honesty in representing and serving the interests of the client should be reasonably compensated for
his service.

Note: Compromise agreement is to be approved despite favorable action on the Intervenor’s Motion for Intervention.
 Republic of the Philippines
SUPREME COURT
Manila

FIRST DIVISION

G.R. No. 183952 September 9, 2013

CZARINA T. MALVAR, Petitioner,

vs.
KRAFT FOOD PHILS., INC. and/or BIENVENIDO BAUTISTA, KRAFT FOODS INTERNATIONAL, Respondents.

DECISION

BERSAMIN, J.:

Although the practice of law is not a business, an attorney is entitled to be properly compensated for the professional services rendered for the client,
who is bound by her express agreement to duly compensate the attorney. The client may not deny her attorney such just compensation.

The Case

The case initially concerned the execution of a final decision of the Court of Appeals (CA) in a labor litigation, but has mutated into a dispute over
attorney's fees between the winning employee and her attorney after she entered into a compromise agreement with her employer under circumstances
that the attorney has bewailed as designed to prevent the recovery of just professional fees.

Antecedents

On August 1, 1988, Kraft Foods (Phils.), Inc. (KFPI) hired Czarina Malvar (Malvar) as its Corporate Planning Manager. From then on, she gradually rose
from the ranks, becoming in 1996 the Vice President for Finance in the Southeast Asia Region of Kraft Foods International (KFI),KFPI’s mother
company. On November 29, 1999, respondent Bienvenido S. Bautista, as Chairman of the Board of KFPI and concurrently the Vice President and Area
Director for Southeast Asia of KFI, sent Malvar a memo directing her to explain why no administrative sanctions should be imposed on her for possible
breach of trust and confidence and for willful violation of company rules and regulations. Following the submission of her written explanation, an
investigating body was formed. In due time, she was placed under preventive suspension with pay. Ultimately, on March 16, 2000, she was served a
notice of termination.

Obviously aggrieved, Malvar filed a complaint for illegal suspension and illegal dismissal against KFPI and Bautista in the National Labor Relations
Commission (NLRC). In a decision dated April 30, 2001, 1 the Labor Arbiter found and declared her suspension and dismissal illegal, and ordered her
reinstatement, and the payment of her full backwages, inclusive of allowances and other benefits, plus attorney’s fees.

On October 22, 2001, the NLRC affirmed the decision of the Labor Arbiter but additionally ruled that Malvar was entitled to "any and all stock options
and bonuses she was entitled to or would have been entitled to had she not been illegally dismissed from her employment," as well as to moral and
exemplary damages.2

KFPI and Bautista sought the reconsideration of the NLRC’s decision, but the NLRC denied their motion to that effect. 3

Undaunted, KFPI and Bautista assailed the adverse outcome before the CA on certiorari (CA-G.R. SP No. 69660), contending that the NLRC thereby
committed grave abuse of discretion. However, the petition for certiorari was dismissed by the CA on December 22, 2004, but with the CA reversing the
order of reinstatement and instead directing the payment of separation pay to Malvar, and also reducing the amounts awarded as moral and exemplary
damages.4

After the judgment in her favor became final and executory on March14, 2006, Malvar moved for the issuance of a writ of execution.5 The Executive
Labor Arbiter then referred the case to the Research and Computation Unit (RCU) of the NLRC for the computation of the monetary awards under the
judgment. The RCU’s computation ultimately arrived at the total sum of ₱41,627,593.75.6

On November 9, 2006, however, Labor Arbiter Jaime M. Reyno issued an order, 7 finding that the RCU’s computation lacked legal basis for including the
salary increases that the decision promulgated in CA-G.R. SP No. 69660 did not include. Hence, Labor Arbiter Reyno reduced Malvar’s total monetary
award to ₱27,786,378.11, viz:

WHEREFORE, premises considered, in so far as the computation of complainant’s other benefits and allowances are concerned, the same are in order.
However, insofar as the computation of her backwages and other monetary benefits (separation pay, unpaid salary for January 1 to 26, 2005,holiday
pay, sick leave pay, vacation leave pay, 13th month pay), the same are hereby recomputed as follows:
1. Separation Pay
8/1/88-1/26/05 = 16 yrs
₱344,575.83 x 16 = 5,513,213.28
2. Unpaid Salary
1/1-26/05 = 87 mos.
₱344,575.83 x 87 = 299,780.97
3. Holiday Pay
4/1/00-1/26/05 = 55 holidays
₱4,134,910/12 mos/20.83 days x 55 days 909,825.77
4. Unpaid 13th month pay for Dec 2000 344,575.83
 5. Sick Leave Pay
Year 1999 to 2004 = 6 yrs
₱344,575.88/20.83 x 15 days x 6 = 1,488,805.79
Year 2005
₱344,575.83/20.83 x 15/12 x 1 20,677.86 1,509,483.65
6. Vacation Leave Pay
Year 1999 to 2004 = 6 years
₱344,575.88/20.83 x 22 days x 6 = 2,183,581.83
Year 2005
₱344,575.83/20.83 x 22/12 x 1 30,327.55 2,213,909.36

10,790,788.86
Backwages (from 3/7/00-4/30/01, award in LA Sytian’s Decision 4,651,773.75
Allowances & Other Benefits:
Management Incentive Plan 7,355,166.58
Cash Dividend on Philip Morris Shares 2,711,646.00
Car Maintenance 381,702.92
Gas Allowance 198,000.00
Entitlement to a Company Driver 438,650.00
Rice Subsidy 58,650.00
Moral Damages 500,000.00
Exemplary Damages 200,000.00
Attorney’s Fees 500,000.00
Entitlement to Philip Sch G Subject to
"Share Option Grant" Market Price

27,786,378.11

SO ORDERED.

Both parties appealed the computation to the NLRC, which, on April19, 2007, rendered its decision setting aside Labor Arbiter Reyno’s November 9,
2006 order, and adopting the computation by the RCU.8

In its resolution dated May 31, 2007,9 the NLRC denied the respondents’ motion for reconsideration.

Malvar filed a second motion for the issuance of a writ of execution to enforce the decision of the NLRC rendered on April 19, 2007. After the writ of
execution was issued, a partial enforcement as effected by garnishing the respondents’ funds deposited with Citibank worth 37,391,696.06.10

On July 27, 2007, the respondents went to the CA on certiorari (with prayer for the issuance of a temporary restraining order (TRO) or writ of preliminary
injunction), assailing the NLRC’s setting aside of the computation by Labor Arbiter Reyno (CA-G.R. SP No. 99865). The petition mainly argued that the
NLRC had gravely abused its discretion in ruling that: (a) the inclusion of the salary increases and other monetary benefits in the award to Malvar was
final and executory; and (b) the finality of the ruling in CA-G.R. SP No. 69660 precluded the respondents from challenging the inclusion of the salary
increases and other monetary benefits. The CA issued a TRO, enjoining the NLRC and Malvar from implementing the NLRC’s decision.11

On April 17, 2008, the CA rendered its decision in CA-G.R. SP No. 99865,12 disposing thusly:

WHEREFORE, premises considered, the herein Petition is GRANTED and the 19 April 2007 Decision of the NLRC and the 31May 2007 Resolution in
NLRC NCR 30-07-02316-00 are hereby REVERSED and SET ASIDE.

The matter of computation of monetary awards for private respondent is hereby REMANDED to the Labor Arbiter and he is DIRECTED to recompute the
monetary award due to private respondent based on her salary at the time of her termination, without including projected salary increases. In computing
the said benefits, the Labor Arbiter is further directed to DISREGARD monetary awards arising from: (a) the management incentive plan and (b) the
share option grant, including cash dividends arising therefrom without prejudice to the filing of the appropriate remedy by the private respondent in the
proper forum. Private respondent’s allowances for car maintenance and gasoline are likewise DELETED unless private respondent proves, by
appropriate receipts, her entitlement thereto.

With respect to the Motion to Exclude the Undisputed Amount of ₱14,252,192.12 from the coverage of the Writ of Preliminary Injunction and to order its
immediate release, the same is hereby GRANTED for reasons stated therefor, which amount shall be deducted from the amount to be given to private
respondent after proper computation.

As regards the Motions for Reconsideration of the Resolution denying the Motion for Voluntary Inhibition and the Omnibus Motion dated 30 October
2007, both motions are hereby DENIED for lack of merit.

SO ORDERED.13
Malvar sought reconsideration, but the CA denied her motion on July30, 2008. 14

Aggrieved, Malvar appealed to the Court, assailing the CA’s decision.

On December 9, 2010, while her appeal was pending in this Court, Malvar and the respondents entered into a compromise agreement, the pertinent
dispositive portion of which is quoted as follows:

NOW, THEREFORE, for and in consideration of the covenants and understanding between the parties herein, the parties hereto have entered into this
Agreement on the following terms and conditions:

1. Simultaneously upon execution of this Agreement in the presence of Ms. Malvar’s attorney, KFPI shall pay Ms. Malvar the amount of Philippine Pesos
Forty Million (Php 40,000,000.00), which is in addition to the Philippine Pesos Fourteen Million Two Hundred Fifty-Two Thousand One Hundred Ninety-
Two and Twelve Centavos (Php14,252,192.12) already paid to and received by Ms. Malvar from KFPI in August2008 (both amounts constituting the
"Compromise Payment").

The Compromise Payment includes full and complete payment and settlement of Ms. Malvar’s salaries and wages up to the last day of her employment,
allowances, 13th and 14th month pay, cash conversion of her accrued vacation, sick and emergency leaves, separation pay, retirement pay and such
other benefits, entitlements, claims for stock, stock options or other forms of equity compensation whether vested or otherwise and claims of any and all
kinds against KFPI and KFI and Altria Group, Inc., their predecessors-in-interest, their stockholders, officers, directors, agents or successors-in-interest,
affiliates and subsidiaries, up to the last day of the aforesaid cessation of her employment.

2. In consideration of the Compromise Payment, Ms. Malvar hereby freely and voluntarily releases and forever discharges KFPI and KFI and Altria
Group, Inc., their predecessors or successors-in-interest, stockholders, officers, including Mr. Bautista who was impleaded in the Labor Case as a party
respondent, directors, agents or successors-in-interest, affiliates and subsidiaries from any and all manner of action, cause of action, sum of money,
damages, claims and demands whatsoever in law or in equity which Ms. Malvar or her heirs, successors and assigns had, or now have against KFPI
and/or KFI and/or Altria Group, Inc., including but not limited to, unpaid wages, salaries, separation pay, retirement pay, holiday pay, allowances, 13th
and 14th month pay, claims for stock, stock options or other forms of equity compensation whether vested or otherwise whether arising from her
employment contract, company grant, present and future contractual commitments, company policies or practices, or otherwise, in connection with Ms.
Malvar’s employment with KFPI.15

Thereafter, Malvar filed an undated Motion to Dismiss/Withdraw Case, 16 praying that the appeal be immediately dismissed/withdrawn in view of the
compromise agreement, and that the case be considered closed and terminated.

Intervention

Before the Court could act on Malvar’s Motion to Dismiss/Withdraw Case, the Court received on February 15, 2011 a so-called Motion for Intervention to
Protect Attorney’s Rights17 from The Law Firm of Dasal, Llasos and Associates, through its Of Counsel Retired Supreme Court Associate Justice Josue
N. Bellosillo18 (Intervenor), whereby the Intervenor sought, among others, that both Malvar and KFPI be held and ordered to pay jointly and severally the
Intervenor’s contingent fees.

The Motion for Intervention relevantly averred:

Lawyers, oftentimes, are caricatured as alligators or some other specie of voracious carnivore; perceived also as leeches sucking dry the blood of their
adversaries, and even their own clients they are sworn to serve and protect! As we lay down the facts in this case, this popular, rather unpopular,
perception will be shown wrong. This case is a reversal of this perception.

Here, it is the lawyer who is eaten up alive by the warring but conspiring litigants who finally settled their differences without the knowledge, much less,
participation, of Petitioner’s counsel that labored hard and did everything to champion her cause.

This Motion for Intervention will illustrate an aberration from the norm where the lawyer ends up seeking protection from his client’s and Respondents’
indecent and cunning maneuverings.

On 18 March 2008 Petitioner engaged the professional services of Intervenor x x x on a contingency basis whereby the former agreed in writing to pay
the latter contingency fees amounting to almost ₱19,600,000.00 (10% of her total claim of almost ₱196,000,000.00 in connection with her labor case
against Respondents.

According to their agreement (Annex "A"), Petitioner bound herself to pay Intervenor contingency fees as follows (a) 10% of ₱14,252, 192.12 upon its
collection; (b) 10% of the remaining balance of ₱41,627,593.75; and (c)10% of the value of the stock options Petitioner claims to be entitled to, or
roughly ₱154,000,000.00 as of April 2008.

Intervenor’s efforts resulted in the award and partial release of Petitioner’s claim amounting to ₱14,252,192.12 out of which Petitioner paid Intervenor
10% or ₱1,425,219.21 as contingency fees pursuant to their engagement agreement (Annex "A"). Copy of the check payment of Petitioner payable to
Intervenor’s Of Counsel is attached as Annex "C"

On 12 September 2008 Intervenor filed an exhaustive Petition for Review with the Supreme Court containing 70 pages, including its Annexes "A" to "R",
or a total of 419 pages against Respondents to collect on the balance of Petitioner’s claims amounting to at least ₱27,000,000.00 and ₱154,000,000.00
the latter representing the estimated value of Petitioner’s stock options as of April 2008.

On 15 January 2009 Respondents filed their Comment to the Petition for Review.

On 13 April 2009 Intervenor, in behalf of Petitioner, filed its Reply to the Comment.

All the pleadings in this Petition have already been submitted on time with nothing more to be done except to await the Resolution of this Honorable
Court which, should the petition be decided in her favor, Petitioner would stand to gain ₱182,000,000.00, more or less, which victory would be largely
through the efforts of Intervenor.19 (Bold emphasis supplied).
It appears that in July 2009, to the Intervenor’s surprise, Malvar unceremoniously and without any justifiable reason terminated its legal service and
required it to withdraw from the case.20 Hence, on October 5,2009, the Intervenor reluctantly filed a Manifestation (With Motion to Withdraw as Counsel
for Petitioner),21 in which it spelled out: (a) the terms of and conditions of the Intervenor’s engagement as counsel; (b) the type of legal services already
rendered by the Intervenor for Malvar; (c) the absence of any legitimate reason for the termination of their attorney-client relationship; (d) the reluctance
of the Intervenor to withdraw as Malvar’s counsel; and (e) the desire of the Intervenor to assert and claim its contingent fee notwithstanding its
withdrawal as counsel. The Intervenor prayed that the Court furnish it with copies of resolutions, decisions and other legal papers issued or to be issued
after its withdrawal as counsel of Malvar in the interest of protecting its interest as her attorney.

The Intervenor indicated that Malvar’s precipitate action had baffled, shocked and even embarrassed the Intervenor, because it had done everything
legally possible to serve and protect her interest. It added that it could not recall any instance of conflict or misunderstanding with her, for, on the
contrary, she had even commended it for its dedication and devotion to her case through her following letter to Justice Bellosillo, to wit:

July 16, 2008

Justice Josue Belocillo (sic)

Dear Justice,

It is almost morning of July 17 as I write this letter to you. Let me first thank you for your continued and unrelenting lead, help and support in the case.
You have been our "rock" as far as this case is concerned. Jun and I are forever grateful to you for all your help. I just thought I’d express to you what is
in the innermost of my heart as we proceed in the case. It has been around four months now since we met mid-March early this year.

The most important and immediate aspect of the case at this time for me is the collection of the undisputed amount of Pesos 14million which the Court
has clearly directed and ordered the NLRC to execute. The only impending constraint for NLRC to execute and collect this amount from the already
garnished amount of Pesos 41 million at Citibank is the MR of Kraft on the Order of the Court (CA) to execute collection. We need to get a denial of this
motion for NLRC to execute immediately. We already obtained commitment from NLRC that all it needed to execute collection is the denial of the MR.
Jun and I applaud your initiative and efforts to mediate with Romulo on potential settlement. However, as I expressed to you in several instances, I have
serious reservations on the willingness of Romulo to settle within reasonable amounts specifically as it relates to the stock options. Let us continue to
pursue this route vigorously while not setting aside our efforts to influence the CA to DENY their Motion on the Undisputed amount of Pesos 14million.

At this point, I cannot overemphasize to you our need for funds. We have made financial commitments that require us to raise some amount. But we can
barely meet our day to day business and personal requirements given our current situation right now.

Thank you po for your understanding and support.22

According to the Intervenor, it was certain that the compromise agreement was authored by the respondents to evade a possible loss of
₱182,000,000.00 or more as a result of the labor litigation, but considering the Intervenor’s interest in the case as well as its resolve in pursuing Malvar’s
interest, they saw the Intervenor as a major stumbling block to the compromise agreement that it was then brewing with her. Obviously, the only way to
remove the Intervenor was to have her terminate its services as her legal counsel. This prompted the Intervenor to bring the matter to the attention of the
Court to enable it to recover in full its compensation based on its written agreement with her, averring thus:

28. Upon execution of the Compromise Agreement and pursuant thereto, Petitioner immediately received (supposedly) from
Respondents₱40,000,000.00. But despite the settlement between the parties, Petitioner did not pay Intervenor its just compensation as set forth in their
engagement agreement; instead, she immediately moved to Dismiss/Withdraw the Present Petition.

29. To parties’ minds, with the dismissal by Petitioner of Intervenor as her counsel, both Petitioner and Respondents probably thought they would be
able to settle the case without any cost to them, with Petitioner saving on Intervenor’s contingent fees while Respondents able to take advantage of the
absence of Intervenor in determining the settlement price.

30. The parties cannot be any more mistaken. Pursuant to the Second Paragraph of Section 26, Rule 138, of the Revised Rules of Court quoted in
paragraph 3 hereof, Intervenor is still entitled to recover from Petitioner the full compensation it deserves as stipulated in its contract.

31. All the elements for the full recovery of Intervenor’s compensation are present. First, the contract between the Intervenor and Petitioner is reduced
into writing. Second, Intervenor is dismissed without justifiable cause and at the stage of proceedings where there is nothing more to be done but to
await the Decision or Resolution of the Present Petition. 23

In support of the Motion for Intervention, the Intervenor cites the rulings in Aro v. Nañawa24 and Law Firm of Raymundo A. Armovit v. Court of
Appeals,25 particularly the following passage:

x x x. While We here reaffirm the rule that "the client has an undoubted right to compromise a suit without the intervention of his lawyer," We hold that
when such compromise is entered into in fraud of the lawyer, with intent to deprive him of the fees justly due him, the compromise must be subject to the
said fees and that when it is evident that the said fraud is committed in confabulation with the adverse party who had knowledge of the lawyer’s
contingent interest or such interest appears of record and who would benefit under such compromise, the better practice is to settle the matter of the
attorney’s fees in the same proceeding, after hearing all the affected parties and without prejudice to the finality of the compromise agreement in so far
as it does not adversely affect the right of the lawyer.26

The Intervenor prays for the following reliefs:

a) Granting the Motion for Intervention to Protect Attorney’s Rights in favor of the Intervenor;

b) Directing both Petitioner and Respondents jointly and severally to pay Intervenor its contingent fees;

c) Granting a lien upon all judgments for the payment of money and executions issued in pursuance of such judgments; and

d) Holding in Abeyance in the meantime the Resolution of the Motion to Dismiss/Withdraw Case filed by Petitioner and granting the Motion
only after Intervenor has been fully paid its just compensation; and

e) Other reliefs just and equitable.27

Opposing the Motion for Intervention,28 Malvar stresses that there was no truth to the Intervenor’s claim to defraud it of its professional fees; that the
Intervenor lacked the legal capacity to intervene because it had ceased to exist after Atty. Marwil N. Llasos resigned from the Intervenor and Atty.
Richard B. Dasal became barred from private practice upon his appointment as head of the Legal Department of the Small Business Guarantee and
Finance Corporation, a government subsidiary; and that Atty. Llasos and Atty. Dasal had personally handled her case.

Malvar adds that even assuming, arguendo, that the Intervenor still existed as a law firm, it was still not entitled to intervene for the following reasons,
namely: firstly, it failed to attend to her multiple pleas and inquiries regarding the case, as when communications to the Intervenor through text messages
were left unanswered; secondly, maintaining that this was a justifiable cause to dismiss its services, the Intervenor only heeded her repeated demands
to withdraw from the case when Atty. Dasal was confronted about his appointment to the government subsidiary; thirdly, it was misleading and grossly
erroneous for the Intervenor to claim that it had rendered to her full and satisfactory services when the truth was that its participation was strictly limited
to the preparation, finalization and submission of the petition for review with the Supreme Court; and finally, while the Intervenor withdrew its services on
October 5, 2009, the compromise agreement was executed with the respondents on December 9,2010 and notarized on December 14, 2010, after more
than a year and two months, dispelling any badge of bad faith on their end.

On June 21, 2011, the respondents filed their comment to the Intervenor’s Motion for Intervention.

On November 18, 2011, the Intervenor submitted its position on the respondent’s comment dated June 21, 2011, 29and thereafter the respondents sent in
their reply.30

Issues

The issues for our consideration and determination are two fold, namely: (a) whether or not Malvar’s motion to dismiss the petition on the ground of the
execution of the compromise agreement was proper; and (b) whether or not the Motion for Intervention to protect attorney’s rights can prosper, and, if
so, how much could it recover as attorney’s fees.

Ruling of the Court

We shall decide the issues accordingly.

1.Client’s right to settle litigation by compromise agreement, and to terminate counsel; limitations

A compromise agreement is a contract, whereby the parties undertake reciprocal obligations to avoid litigation, or put an end to one already
commenced.31 The client may enter into a compromise agreement with the adverse party to terminate the litigation before a judgment is rendered
therein.32 If the compromise agreement is found to be in order and not contrary to law, morals, good customs and public policy, its judicial approval is in
order.33 A compromise agreement, once approved by final order of the court, has the force of res judicata between the parties and will not be disturbed
except for vices of consent or forgery.34

A client has an undoubted right to settle her litigation without the intervention of the attorney, for the former is generally conceded to have exclusive
control over the subject matter of the litigation and may at anytime, if acting in good faith, settle and adjust the cause of action out of court before
judgment, even without the attorney’s intervention.35 It is important for the client to show, however, that the compromise agreement does not adversely
affect third persons who are not parties to the agreement.36

By the same token, a client has the absolute right to terminate the attorney-client relationship at any time with or without cause.37 But this right of the
client is not unlimited because good faith is required in terminating the relationship. The limitation is based on Article 19 of the Civil Code, which
mandates that "every person must, in the exercise of his rights and in the performance of his duties, act with justice, give everyone his due, and observe
honesty and good faith." The right is also subject to the right of the attorney to be compensated. This is clear from Section 26, Rule 138 of the Rules of
Court, which provides:

Section 26. Change of attorneys. - An attorney may retire at anytime from any action or special proceeding, by the written consent of his client filed in
court. He may also retire at any time from an action or special proceeding, without the consent of his client, should the court, on notice to the client and
attorney, and on hearing, determine that he ought to be allowed to retire. In case of substitution, the name of the attorney newly employed shall be
entered on the docket of the court in place of the former one, and written notice of the change shall be given to the adverse party.

A client may at any time dismiss his attorney or substitute another in his place, but if the contract between client and attorney has been reduced to
writing and the dismissal of the attorney was without justifiable cause, he shall be entitled to recover from the client the full compensation stipulated in
the contract. However, the attorney may, in the discretion of the court, intervene in the case to protect his rights. For the payment of his compensation
the attorney shall have a lien upon all judgments for the payment of money, and executions issued in pursuance of such judgment, rendered in the case
wherein his services had been retained by the client. (Bold emphasis supplied)

In fine, it is basic that an attorney is entitled to have and to receive a just and reasonable compensation for services performed at the special instance
and request of his client. The attorney who has acted in good faith and honesty in representing and serving the interests of the client should be
reasonably compensated for his service.38

2. Compromise agreement is to be approved despite favorable action on the Intervenor’s Motion for Intervention

On considerations of equity and fairness, the Court disapproves of the tendencies of clients compromising their cases behind the backs of their attorneys
for the purpose of unreasonably reducing or completely setting to naught the stipulated contingent fees. 39 Thus, the Court grants the Intervenor’s Motion
for Intervention to Protect Attorney’s Rights as a measure of protecting the Intervenor’s right to its stipulated professional fees that would be denied
under the compromise agreement. The Court does so in the interest of protecting the rights of the practicing Bar rendering professional services on
contingent fee basis.

Nonetheless, the claim for attorney’s fees does not void or nullify the compromise agreement between Malvar and the respondents. There being no
obstacles to its approval, the Court approves the compromise agreement. The Court adds, however, that the Intervenor is not left without a remedy, for
the payment of its adequate and reasonable compensation could not be annulled by the settlement of the litigation without its participation and
conformity. It remains entitled to the compensation, and its right is safeguarded by the Court because its members are officers of the Court who are as
entitled to judicial protection against injustice or imposition of fraud committed by the client as much as the client is against their abuses as her counsel.
In other words, the duty of the Court is not only to ensure that the attorney acts in a proper and lawful manner, but also to see to it that the attorney is
paid his just fees. Even if the compensation of the attorney is dependent only on winning the litigation, the subsequent withdrawal of the case upon the
client’s initiative would not deprive the attorney of the legitimate compensation for professional services rendered.40
The basis of the intervention is the written agreement on contingent fees contained in the engagement executed on March 19, 2008 between Malvar and
the Intervenor,41 the pertinent portion of which stipulated that the Intervenor would "collect ten percent (10%) of the amount of Ph₱14,252,192.12 upon
its collection and another ten percent (10%) of the remaining balance of Ph₱41,627,593.75 upon collection thereof, and also ten percent (10%) of
whatever is the value of the stock option you are entitled to under the Decision." There is no question that such arrangement was a contingent fee
agreement that was valid in this jurisdiction, provided the fees therein fixed were reasonable. 42

We hold that the contingent fee of 10% of ₱41,627,593.75 and 10% of the value of the stock option was reasonable. The ₱41,627,593.75 was already
awarded to Malvar by the NLRC but the award became the subject of the appeal in this Court because the CA reversed the NLRC. Be that as it may, her
subsequent change of mind on the amount sought from the respondents as reflected in the compromise agreement should not negate or bar the
Intervenor’s recovery of the agreed attorney’s fees.

Considering that in the event of a dispute between the attorney and the client as to the amount of fees, and the intervention of the courts is sought, the
determination requires that there be evidence to prove the amount of fees and the extent and value of the services rendered, taking into account the
facts determinative thereof,43 the history of the Intervenor’s legal representation of Malvar can provide a helpful predicate for resolving the dispute
between her and the Intervenor.

The records reveal that on March 18, 2008, Malvar engaged the professional services of the Intervenor to represent her in the case of illegal dismissal.
At that time, the case was pending in the CA at the respondents’ instance after the NLRC had set aside the RCU’s computation of Malvar’s backwages
and monetary benefits, and had upheld the computation arrived at by the NLRC Computation Unit. On April 17, 2008, the CA set aside the assailed
resolution of the NLRC, and remanded the case to the Labor Arbiter for the computation of her monetary awards. It was at this juncture that the
Intervenor commenced its legal service, which included the following incidents, namely:

a) Upon the assumption of its professional duties as Malvar’s counsel, a Motion for Reconsideration of the Decision of the Court of Appeals
dated April 17, 2008 consisting of thirty-eight pages was filed before the Court of Appeals on May 6, 2008.

b) On June 2, 2009, Intervenors filed a Comment to Respondents’ Motion for Partial Reconsideration, said Comment consisted 8 pages.

c) In the execution proceedings before Labor Arbiter Jaime Reyno, Intervenor prepared and filed on Malvar’s behalf an "Ex-Parte Motion to
Release to Complainant the Undisputed amount of ₱14,252,192.12" in NLRC NCR Case No. 30-07-02716-00.

d) On July 29, 2000, Intervenor prepared and filed before theLabor Arbiter a Comment to Respondents’ Opposition to the "Ex-Parte Motion to
Release" and a "Motion Reiterating Immediate Implementation of the Writ of Execution"

e) On August 6, 2008, Intervenor prepared and filed before the Labor Arbiter Malvar’s Motion Reiterating Motion to Release the Amount of
₱14,252,192.12.44

The decision promulgated on April 17, 200845 and the resolution promulgated on July 30, 200846 by the CA prompted Malvar to appeal on August 15,
2008 to this Court with the assistance of the Intervenor. All the subsequent pleadings, including the reply of April 13, 2009,47 were prepared and filed in
Malvar’s behalf by the Intervenor.

Malvar should accept that the practice of law was not limited to the conduct of cases or litigations in court but embraced also the preparation of
pleadings and other papers incidental to the cases or litigations as well as the management of such actions and proceedings on behalf of the
clients.48 Consequently, fairness and justice demand that the Intervenor be accorded full recognition as her counsel who discharged its responsibility for
Malvar’s cause to its successful end.

But, as earlier pointed out, although a client may dismiss her lawyer at any time, the dismissal must be for a justifiable cause if a written contract
between the lawyer and the client exists.49

Considering the undisputed existence of the written agreement on contingent fees, the question begging to be answered is: Was the Intervenor
dismissed for a justifiable cause?

We do not think so.

In the absence of the lawyer’s fault, consent or waiver, a client cannot deprive the lawyer of his just fees already earned in the guise of a justifiable
reason. Here, Malvar not only downplayed the worth of the Intervenor’s legal service to her but also attempted to camouflage her intent to defraud her
lawyer by offering excuses that were not only inconsistent with her actions but, most importantly, fell short of being justifiable.

The letter Malvar addressed to Retired Justice Bellosillo, who represented the Intervenor, debunked her allegations of unsatisfactory legal service
because she thereby lavishly lauded the Intervenor for its dedication and devotion to the prosecution of her case and to the protection of her interests.
Also significant was that the attorney-client relationship between her and the Intervenor was not severed upon Atty. Dasal’s appointment to public office
and Atty. Llasos’ resignation from the law firm. In other words, the Intervenor remained as her counsel of record, for, as we held in Rilloraza, Africa, De
Ocampo and Africa v. Eastern Telecommunication Philippines, Inc., 50 a client who employs a law firm engages the entire law firm; hence, the
resignation, retirement or separation from the law firm of the handling lawyer does not terminate the relationship, because the law firm is bound to
provide a replacement.

The stipulations of the written agreement between Malvar and the Intervenors, not being contrary to law, morals, public policy, public order or good
customs, were valid and binding on her. They expressly gave rise to the right of the Intervenor to demand compensation. In a word, she could not simply
walk away from her contractual obligations towards the Intervenor, for Article 1159 of the Civil Code provides that obligations arising from contracts have
the force of law between the parties and should be complied with in good faith.

To be sure, the Intervenor’s withdrawal from the case neither cancelled nor terminated the written agreement on the contingent attorney’s fees. Nor did
the withdrawal constitute a waiver of the agreement. On the contrary, the agreement continued between them because the Intervenor’s Manifestation
(with Motion to Withdraw as Counsel for Petitioner)explicitly called upon the Court to safeguard its rights under the written agreement, to wit:

WHEREFORE, premises considered, undersigned counsel respectfully pray that instant Motion to Withdraw as Counsel for Petitioner be granted and
their attorney’s lien pursuant to the written agreement be reflected in the judgment or decision that may be rendered hereafter conformably with par. 2,
Sec. 26, Rule 138 of the Rules of Court.

Undersigned counsel further requests that they be furnished copy of the decision, resolutions and other legal processes of this Honorable Court to
enable them to protect their interests.51
Were the respondents also liable?

The respondents would be liable if they were shown to have connived with Malvar in the execution of the compromise agreement, with the intention of
depriving the Intervenor of its attorney’s fees. Thereby, they would be solidarily liable with her for the attorney’s fees as stipulated in the written
agreement under the theory that they unfairly and unjustly interfered with the Intervenor’s professional relationship with Malvar.

The respondents insist that they were not bound by the written agreement, and should not be held liable under it.1âwphi1

We disagree with the respondents’ insistence. The respondents were complicit in Malvar’s move to deprive the Intervenor of its duly earned contingent
fees.

First of all, the unusual timing of Malvar’s letter terminating the Intervenor’s legal representation of her, of her Motion to Dismiss/Withdraw Case, and of
the execution of compromise agreement manifested her desire to evade her legal obligation to pay to the Intervenor its attorney’s fees for the legal
services rendered. The objective of her withdrawal of the case was to release the respondents from all her claims and causes of action in consideration
of the settlement in the stated amount of ₱40,000.000.00, a sum that was measly compared to what she was legally entitled to, which, to begin with,
already included the ₱41,627,593.75 and the value of the stock option already awarded to her. In other words, she thereby waived more than what she
was lawfully expected to receive from the respondents.

Secondly, the respondents suddenly turned around from their strong stance of berating her demand as offensive to all precepts of justice and fair play
and as a form of unjust enrichment for her to a surprisingly generous surrender to her demand, allowing to her through their compromise agreement the
additional amount of ₱40,000,000.00 on top of the₱14,252,192.12 already received by her in August 2008. The softening unavoidably gives the
impression that they were now categorically conceding that Malvar deserved much more. Under those circumstances, it is plausible to conclude that her
termination of the Intervenor’s services was instigated by their prodding in order to remove the Intervenor from the picture for being a solid obstruction to
the settlement for a much lower liability, and thereby save for themselves and for her some more amount.

Thirdly, the compromise agreement was silent on the Intervenor’s contingent fee, indicating that the objective of the compromise agreement was to
secure a huge discount from its liability towards Malvar.

Finally, contrary to the stipulation in the compromise agreement, only Malvar, minus the respondents, filed the Motion to Dismiss/Withdraw Case.

At this juncture, the Court notes that the compromise agreement would have Malvar waive even the substantial stock options already awarded by the
NLRC’s decision,52 which ordered the respondents to pay to her, among others, the value of the stock options and all other bonuses she was entitled to
or would have been entitled to had she not been illegally dismissed from her employment. This ruling was affirmed by the CA. 53 But the waiver could not
negate the Intervenor’s right to 10% of the value of the stock options she was legally entitled to under the decisions of the NLRC and the CA, for that
right was expressly stated in the written agreement between her and the Intervenor. Thus, the Intervenor should be declared entitled to recover full
compensation in accordance with the written agreement because it did not assent to the waiver of the stock options, and did not waive its right to that
part of its compensation.

These circumstances show that Malvar and the respondents needed an escape from greater liability towards the Intervenor, and from the possible
obstacle to their plan to settle to pay. It cannot be simply assumed that only Malvar would be liable towards the Intervenor at that point, considering that
the Intervenor, had it joined the negotiations as her lawyer, would have tenaciously fought all the way for her to receive literally everything that she was
entitled to, especially the benefits from the stock option. Her rush to settle because of her financial concerns could have led her to accept the
respondents’ offer, which offer could be further reduced by the Intervenor’s expected demand for compensation. Thereby, she and the respondents
became joint tort-feasors who acted adversely against the interests of the Intervenor. Joint tort-feasors are those who command, instigate, promote,
encourage, advise, countenance, cooperate in, aid or abet the commission of a tort, or who approve of it after it is done, if done for their benefit.54

They are also referred to as those who act together in committing wrong or whose acts, if independent of each other, unite in causing a single
injury.55 Under Article 2194 of the Civil Code, joint tort-feasors are solidarily liable for the resulting damage. As regards the extent of their respective
liabilities, the Court said in Far Eastern Shipping Company v. Court of Appeals: 56

x x x. Where several causes producing an injury are concurrent and each is an efficient cause without which the injury would not have happened, the
injury may be attributed to all or any of the causes and recovery may be had against any or all of the responsible persons although under the
circumstances of the case, it may appear that one of them was more culpable, and that the duty owed by them to the injured person was not same. No
actor’s negligence ceases to be a proximate cause merely because it does not exceed the negligence of other acts. Each wrongdoer is responsible for
the entire result and is liable as though his acts were the sole cause of the injury.

There is no contribution between joint tort-feasors whose liability is solidary since both of them are liable for the total damage. Where the concurrent or
successive negligent acts or omissions of two or more persons, although acting independently, are in combination the direct and proximate cause of a
single injury to a third person, it is impossible to determine in what proportion each contributed to the injury and either of them is responsible for the
whole injury. x x x

Joint tort-feasors are each liable as principals, to the same extent and in the same manner as if they had performed the wrongful act themselves. It is
likewise not an excuse for any of the joint tort-feasors that individual participation in the tort was insignificant as compared to that of the other.57 To
stress, joint tort-feasors are not liable pro rata. The damages cannot be apportioned among them, except by themselves. They cannot insist upon an
apportionment, for the purpose of each paying an aliquot part. They are jointly and severally liable for the whole amount. 58 Thus, as joint tort-feasors,
Malvar and the respondents should be held solidarily liable to the Intervenor. There is no way of appreciating these circumstances except in this light.

That the value of the stock options that Malvar waived under the compromise agreement has not been fixed as yet is no hindrance to the implementation
of this decision in favor of the Intervenor. The valuation could be reliably made at a subsequent time from the finality of this adjudication. It is enough for
the Court to hold the respondents and Malvar solidarily liable for the 10% of that value of the stock options.

As a final word, it is necessary to state that no court can shirk from enforcing the contractual stipulations in the manner they have agreed upon and
written. As a rule, the courts, whether trial or appellate, have no power to make or modify contracts between the parties. Nor can the courts save the
parties from disadvantageous provisions.59The same precepts hold sway when it comes to enforcing fee arrangements entered into in writing between
clients and attorneys. In the exercise of their supervisory authority over attorneys as officers of the Court, the courts are bound to respect and protect the
attorney’s lien as a necessary means to preserve the decorum and respectability of the Law Profession. 60 Hence, the Court must thwart any and every
effort of clients already served by their attorneys’ worthy services to deprive them of their hard-earned compensation. Truly, the duty of the courts is not
only to see to it that attorneys act in a proper and lawful manner, but also to see to it that attorneys are paid their just and lawful fees.61

WHEREFORE, the Court APPROVES the compromise agreement; GRANTS the Motion for Intervention to Protect Attorney's Rights; and ORDERS
Czarina T. Malvar and respondents Kraft Food Philippines Inc. and Kraft Foods International to jointly and severally pay to Intervenor Law Firm,
represented by Retired Associate Justice Josue N. Bellosillo, its stipulated contingent fees of 10% of ₱41,627,593.75, and the further sum equivalent to
10% of the value of the stock option. No pronouncement on costs of suit.

SO ORDERED.
 CZARINA T. MALVAR v. KRAFT FOOD PHILIPPINES, INC. and/or BIENVENIDO BAUTISTA,
KRAFT FOODS INTERNATIONAL
G.R. No. 183952, 9 September 2013, FIRST DIVISION, (BERSAMIN, J.)

Although the practice of law is not a business, an attorney is entitled to be properly compensated for the professional services
rendered for the client, who is bound by her express agreement to duly compensate the attorney. The client may not deny her attorney such
just compensation.

Malvar filed a complaint for illegal suspension and illegal dismissal against KFPI and Bautista in the National
Labor Relations Commission (NLRC). The Labor Arbiter found and declared her suspension and dismissal illegal,
and ordered her reinstatement, and the payment of her full backwages, inclusive of allowances and other benefits,
plus attorney’s fees. NLRC and CA affirmed the decision of the Labor Arbiter. After the judgment in her favor
became final and executory Malvar moved for the issuance of a writ of execution but the execution failed due to
questionable computation of the award. Malvar requested for the 2nd issuance of the writ of execution and was partially
complied with but with protest on the part of Kraft by filing a TRO for further execution since the computation is
incorrect. CA ruled in favor of Kraft. Thus, Malvar appealed.

While her appeal was pending in this Court, Malvar and Kraft entered into a compromise agreement.
Thereafter, Malvar filed an undated Motion to Dismiss/Withdraw Case, praying that the appeal be immediately
dismissed/withdrawn in view of the compromise agreement, and that the case be considered closed and terminated.
Before the Court could act on Malvar’s Motion to Dismiss/Withdraw Case, the Court received a so-called Motion
for Intervention to Protect Attorney’s Rights from Malvar’s counsel. The counsel indicated that Malvar’s precipitate
action had baffled, shocked and even embarrassed the Intervenor/counsel, because it had done everything legally
possible to serve and protect Malvar’s interest.

ISSUE:
Can the Motion for Intervention to protect attorney’s rights prosper?

RULING:
Yes. A client has an undoubted right to settle her litigation without the intervention of the attorney, for the
former is generally conceded to have exclusive control over the subject matter of the litigation and may at any time,
if acting in good faith, settle and adjust the cause of action out of court before judgment, even without the attorney’s
intervention. It is important for the client to show, however, that the compromise agreement does not adversely affect
third persons who are not parties to the agreement. By such, a client has the absolute right to terminate the attorney-
client relationship at any time with or without cause. But this right of the client is not unlimited because good faith is
required in terminating the relationship. It is basic that an attorney is entitled to have and to receive a just and
reasonable compensation for services performed at the special instance and request of his client. The attorney who
has acted in good faith and honesty in representing and serving the interests of the client should be reasonably
compensated for his service.
 Republic of the Philippines
SUPREME COURT
Baguio City

FIRST DIVISION

A.M. No. RTJ-10-2217 April 8, 2013

SONIA C. DECENA and REY C. DECENA, Petitioners,

vs.
JUDGE NILO A. MALANYAON, REGIONAL TRIAL COURT, BRANCH 32, IN PILI, CAMARINES
SUR,Respondent.

DECISION

BERSAMIN, J.:

A judge may not involve himself in any activity that is an aspect of the private practice of law. His acceptance of an
appointment to the Bench inhibits him from engaging in the private practice of law, regardless of the beneficiary of
the activity being a member of his immediate family. He is guilty of conduct unbecoming of a judge otherwise.

Antecedents

The complainants have lodged an administrative complaint for conduct unbecoming a judge against Hon. Nilo A.
Malanyaon, the Presiding Judge of the Regional Trial Court, Branch 32, in Pili, Camarines Sur.1

In their joint complaint-affidavit dated April 10, 2007,2 the complainants averred that complainant Rey C. Decena
had brought an administrative case in Regional Office No. V of the Civil Service Commission in Legaspi City, Albay
against Judge Malanyaon’s wife, Dr. Amelita C. Malanyaon (Dr. Amelita), then the Assistant Provincial Health
Officer of the Province of Camarines Sur; that during the hearing of the administrative case on May 4, 2006, Judge
Malanyaon sat beside his daughter, Atty. Ma. Kristina C. Malanyaon, the counsel of Dr. Amelita in the case; and that
the events that then transpired were as recounted in the joint complaint-affidavit, to wit:

3. During the early stage of the hearing when the hearing officer, Atty. Dennis Masinas Nieves, brought up the
matter regarding Dr. Malanyaon’s manifestation or motion (to dismiss the case for lack of jurisdiction), Judge
Malanyaon coached her daughter in making manifestations/motions before the hearing officer, by scribbling on
some piece of paper and giving the same to the former, thus prompting her daughter to rise from her seat and/or
ask permission from the officer to speak, and then make some manifestations while reading or glancing on the
paper given by Judge Malanyaon. At one point, Judge Malanyaon even prompted her daughter to demand that Atty.
Eduardo Loria, the collaborating counsel of our principal counsel, Atty. Mary Ailyne Zamora, be required to produce
his PTR number.

4. When our principal counsel, Atty. Zamora, arrived and took over from Atty. Loria, she inquired regarding the
personality of Judge Malanyaon, being seated at the lawyer’s bench beside Atty. Malanyaon, Judge Malanyaon then
proudly introduced himself and manifested that he was the "counsel of the respondent’s counsel". Atty. Zamora
proceeded to raise the propriety of Judge Malanyaon’s sitting with and assisting his daughter in that hearing, being a
member of the judiciary, to which Judge Malanyaon loudly retorted that he be shown any particular rule that
prohibits him from sitting with his daughter at the lawyers’ bench. He insisted that he was merely "assisting" her
daughter, who "just passed the bar", defend the respondent, and was likewise helping the latter defend herself.
Pertinent portion of the records of the proceedings are as follows:

Atty. Nieves : First, she has to enter her appearance. Okay?

Atty. Zamora : Anyway, … I don’t think, I do not memorize my PTR number, I don’t remember my PTR number, but
aside from that Your Honor, I think this Honorable Hearing Officer could take judicial notice that Atty. Ed Loria is
indeed a lawyer in good standing in IBP. And moreover, Your Honor, I would like to inquire as to the personality of
the gentleman next to the lawyer of the defendant or respondent, Your Honor?

Judge Malanyaon: I am the counsel of the complainant, ah, of the respondent’s counsel, I am Judge Malanyaon. I
am assisting her. And so what?!!

Atty. Zamora : Ah, you are the counsel of the … (interrupted)

Atty. Nieves : There’s no need to be belligerent… let’s calm down…

Atty. Zamora : Your Honor, Your Honor, we all do not know each other, and with due respect to the judge, there is
also a hearing officer here Your Honor, and I think Your Honor the Hearing Officer here deserves due respect. I
mean, the word "So what?!", I don’t think that would be proper Your Honor in this Court.
Judge Malanyaon : I am sorry your Honor, because the … is out of turn, out of turn.

Atty. Nieves : This is not necessary, actually, this is not necessary. So we might as well proceed with our hearing
today. I’ve already made a ruling regarding the, the query regarding PTR. Okay, at this stage it is not proper
considering that Atty. Loria only entered his appearance during the start of the hearing. Okay. So, we have to
proceed now.

Atty. Zamora : I am accepting Your Honor the delegation again of Atty. Loria. I am entering my appearance as the
lead counsel for this case, Your Honor, as counsel for the complainant.

Atty. Nieves : Okay.

Atty. Zamora : And may I be clear that the judge will be the collaborating counsel for the respondent or the counsel
of record of the respondent?

Atty. Nieves : … of the judge is … I’m sorry?

Atty. Zamora : He manifested Your Honor that he is the counsel of the respondent.

Atty. Malanyaon : No, the counsel of the counsel of the respondent.

Atty. Nieves : He has not, he has not entered his appearance in this case.

Atty. Zamora : Would that be proper for him Your Honor, considering that he is a judge Your Honor? Would that, ah,
there will be undue influence, or whatever, Your Honor? We are just trying to avoid any bias or undue influence in
this court, Your Honor.

Atty. Nieves : Okay, it will not, considering the fact that he has not entered his appearance for the respondent.

Judge Malanyaon : If Your Honor, please, the respondent is my wife. Counsel for the respondent is my daughter.
She just passed the bar! I’m assisting her. Is it not my right, my duty to assist my daughter? And to assist my wife
defend herself? I am only sitting with my daughter! I’m not acting for the respondent!

Atty. Zamora : I don’t think Your Honor under the rule, the counsel needs a counsel. Only the one charged or the
one being charged needs a counsel.

Atty. Nieves : Okay, let’s settle this now. Judge Malanyaon has not entered his appearance. It will not in any way …

The complainants averred that the actuations of Judge Malanyaon during the hearing of his wife’s administrative
case in the Civil Service Commission constituted violations of the New Code of Judicial Conduct for the Philippines
Judiciary.

On June 21, 2007, then Court Administrator Christopher O. Lock required Judge Malanyaon to comment on the
complaint.3

On July 15, 2007, Judge Malanyaon filed his comment, refuting the allegations of the complaint thusly:

1. Complainants are the sister and nephew of my wife, Amelita C. Malanyaon, there is bad blood between them
arising from divergent political loyalties and family differences;

2. There is no reason for complainants to take offense at my sitting beside my daughter Ma. Kristina, when she
appeared for my wife in the first hearing of the administrative case Rey C. Decena filed against my wife; the hearing
officer himself could cite no rule disallowing me from sitting beside my daughter, in the counsel’s table, and he did
not ask me to vacate where I sat beside my daughter; the transcript does not support complainants’ claim;

3. It is true I snapped at Atty. Zamora, when she asked about my personality – but she was speaking out of turn as
all I was doing was sitting beside my daughter when she came as the transcript will show, I apologized to the
hearing officer, who graciously let the matter pass;

4. My daughter is a new practitioner; her law partner and lead counsel could not make it on time, and as her
consultant, I did not speak, nor enter my appearance for my wife – to lend a helping hand to a neophyte lawyer,
defending her mother in an administrative case, is not unethical, nor does it constitute the proscribed practice of law;

5. It is petty for my sister-in-law and for my nephew to complain of my presence during the hearing; it is my filial duty
to lend my wife and daughter, moral and legal support in their time of need; indeed, it is strange for complainants to
take offense at my presence and accuse me of practicing law during my stint as a judge when before the bad blood
between my wife and her sibling and nephew erupted, I helped them out with their legal problems gratis et amore
and they did not complain of my practicing law on their behalf, indeed, one of the crosses a judge must carry is the
cross of base ingratitude.4
On March 27, 2008, then Court Administrator Zenaida N. Elepaño recommended to the Court that: (a) the complaint
be re-docketed as a regular administrative matter; (b) Judge Malanyaon be found guilty of gross misconduct; and (c)
Judge Malanyaon be fined ₱50,000.00.5

On September 16, 2009, the Court required the parties to manifest within 10 days from notice if they were willing to
submit the case for resolution on the basis of the records or pleadings filed.6

The complainants complied on November 13, 2009, stating their willingness to submit the case for resolution after a
formal investigation or hearing was conducted, and after they were given time to file their respective position papers
or memoranda.7

On January 11, 2010, the Court resolved: (a) to re-docket the administrative case as a regular administrative matter;
(b) to await Judge Malanyaon’s compliance with the September 16, 2009 resolution; and (c) to refer the
administrative matter to the OCA for evaluation, report and recommendation.8

After Judge Malanyaon did not submit any compliance with the September 16, 2009 resolution, the Court ordered
him on February 10, 2010 to show cause why he should not be disciplinarily dealt with or held in contempt for such
failure, and further directed him to still comply with the resolution.9

On February 15, 2010, Judge Malanyaon’s counsel informed the Court that Judge Malanyaon had meanwhile
suffered a massive stroke on September 2, 2009 that had affected his mental faculties and made him unfit to defend
himself here; and prayed for the suspension of the proceedings until Judge Malanyaon would have been found
competent to comprehend and stand the rigors of the investigation.10

On April 12, 2010, the Court deferred action on the case, and required Judge Malanyaon to submit a medical
certificate.11

Judge Malanyaon submitted a medical certificate dated May 27, 2010, issued by the Philippine General Hospital,
certifying that he had been confined thereaft from September 2, 2009 to October 19, 2009 for the following reason,
to wit:

Cerebro Vascular disease, Hypertension Intra Cerebral Hematoma Left Thalamus with obstructive Hydrocephalus;
DM type II, Chronic Obstructive Pulmonary disease; Pneumonia; lleus (resolved); Neurogenic bladder, Benign
Prostatic Hypertrophy; Grave’s disease; Arthritis.

OPERATION PERFORMED: Bilateral tube ventriculostomy12

Judge Malanyaon submitted two more medical certificates, the first dated October 5, 2010,13 certifying that, among
others, he was undergoing regular check-up, and the other, dated January 24, 2011,14 certifying that his functional
and mental status had been assessed as follows:

The severity and location of the hemorrage in the brain resulted in residual epoliptogenic focus (Post-gliotic
seizures) and significant impairment of cognition, memory judgment behavior (Vascular Dementia). He has
problems with memory recall, analysis of information, events and situations which may make defending himself
difficult, if necessary. Although he is independent on ambulation, he requires assistance even in basic activities of
daily living.15

The Court required the complainants to comment on Judge Malanyaon’s medical certification dated October 5,
2010.

On July 18, 2011, however, Dr. Amelita submitted a manifestation and urgent motion to dismiss, seeking the
dismissal of the administrative case against Judge Malanyaon upon the following grounds, to wit:

2. Unfortunately, in a "Medical Certification" dated June 15, 2011 the original of which is attached hereto as Annex
"1", the attending neurologist of my husband has pronounced him permanently mentally impaired.x

3. As a consequence, my husband has permanently lost the capacity to understand the nature and object of the
administrative proceedings against him. He cannot intelligently appoint his counsel or communicate coherently with
him. He cannot testify in his own behalf, and confront and cross-examine opposing witnesses. Indeed, he cannot
properly avail himself of his rights in an adversarial administrative investigation;

4. Given the progressive mental impairment afflicting my husband, he has permanently lost the capacity to defend
himself. Thus, to continue the administrative investigation against my husband who is no longer in any position to
defend himself would constitute a denial of his right to be heard (Baikong Akang Camsa vs. Judge Aurelio Rendon,
A.M. No. MTJ-02-1395 dated 19 February 2002).16
Even so, on September 26, 2011, we required the complainants to comment on the manifestation and motion of Dr.
Amelita.17

Subsequently, Dr. Amelita submitted another motion dated January 23, 2012,18 praying for the dismissal of the case
against Judge Malanyaon.

On February 6, 2012, Court Administrator Jose Midas P. Marquez reiterated the recommendation made on March
27, 2008 by then Court Administrator Elepaño by recommending that: (a) the administrative case be re-docketed as
a regular administrative matter; and (b) Judge Malanyaon be found guilty of gross misconduct and fined
₱50,000.00.19

On May 3, 2012, the Court received the complainants’ compliance dated February 1, 2012,20 as their response to
the show cause order issued in relation to their failure to submit the comment the Court had required on September
26, 2011.21

On September 4, 2012, the Court received from Dr. Amelita an urgent ex parte motion for immediate resolution,
praying that the motion to dismiss dated July 18, 2011 be already resolved.22

Issues: For consideration and resolution are the following issues, namely: (a) whether or not Judge Malanyaon
would be denied due process if the administrative case was not dismissed; (b) whether the actuations of Judge
Malanyaon complained of constituted conduct unbecoming of a judge; and (c) if Judge Malanyaon was guilty of
conduct unbecoming of a judge, what should be the correct sanction.

Ruling: We now discuss and resolve the issues accordingly.

1. Respondent’s right to due process is not violated by resolution of the case

In her manifestation with urgent motion to dismiss,23 Dr. Amelita stressed that proceeding against Judge Malanyaon
despite his present medical state would violate his right to due process. She stated:

3. As a consequence, my husband has permanently lost the capacity to understand the nature and object of the
administrative proceedings against him. He cannot intelligently appoint his counsel or communicate coherently with
him. He cannot testify in his own behalf, and confront and cross-examine opposing witnesses. Indeed, he cannot
properly avail himself of his rights in an adversarial administrative investigation.24

Opposing, the complainants argued that Dr. Amelita’s concern was unfounded considering that Judge Malanyaon
had not only been given the opportunity to be heard, but had been actually heard on their complaint.

The complainants’ argument is well taken.

On August 3, 2007, or prior to his suffering the massive stroke that impaired his mental faculty, Judge Malanyaon
already submitted his comment containing his explanations and refutations of the charge against him. His comment
asserted that during the hearing of the administrative case of his wife in the Regional Office of the Civil Service
Commission, the hearing officer did not even cite any rule that prohibited him from sitting beside his daughter who
was then acting as the counsel of Dr. Amelita therein, or that inhibited him from assisting his daughter in the defense
of his wife. He pointed out that although he had then lost his temper after the opposing counsel had inquired about
his personality in that hearing, he had ultimately apologized to the hearing officer, who had in turn graciously let the
matter pass.

Under the circumstances, Judge Malanyaon was accorded due process. In administrative cases, the requirement of
due process is satisfied whenever the parties are afforded the fair and reasonable opportunity to explain their side of
the controversy,25 either through oral arguments or through pleadings.26 That is what happened herein. Accordingly,
Dr. Amelita’s motion was bereft of basis, and should be denied.

2. Actuations of Judge Malanyaon rendered him guilty of conduct unbecoming of a judge

The following actuations of Judge Malanyaon constituted conduct unbecoming of a judge.

First was Judge Malanyaon’s occupying a seat beside his daughter that was reserved for the lawyers during the
hearing. Such act displayed his presumptuousness, and probably even his clear intention to thereby exert his
influence as a judge of the Regional Trial Court on the hearing officer in order for the latter to favor his wife’s cause.
That impression was definitely adverse against the Judiciary, whose every judicial officer was presumed to be a
subject of strict scrutiny by the public. Being an incumbent RTC Judge, he always represented the Judiciary, and
should have acted with greater circumspection and self-restraint, simply because the administrative hearing was
unavoidably one in which he could not but be partisan. Simple prudence should have counselled him to avoid any
form of suspicion of his motives, or to suppress any impression of impropriety on his part as an RTC judge by not
going to the hearing himself.
Second was Judge Malanyaon’s admission that his presence in that hearing was to advise his daughter on what to
do and say during the hearing, to the point of coaching his daughter. In the process, he unabashedly introduced
himself as the "counsel of the respondent’s counsel" upon his presence being challenged by the adverse counsel,
stating that his daughter was still inexperienced for having just passed her Bar Examinations. Such excuse,
seemingly grounded on a "filial" duty towards his wife and his daughter, did not furnish enough reason for him to
forsake the ethical conduct expected of him as a sitting judge. He ought to have restrained himself from sitting at
that hearing, being all too aware that his sitting would have him cross the line beyond which was the private practice
of law.

Section 3527 of Rule 138 of the Rules of Court expressly prohibits sitting judges like Judge Malanyaon from
engaging in the private practice of law or giving professional advice to clients. Section 11,28 Canon 4 (Propriety),29of
the New Code of Judicial Conduct and Rule 5.0730 of the Code of Judicial Conduct reiterate the prohibition from
engaging in the private practice of law or giving professional advice to clients. The prohibition is based on sound
reasons of public policy, considering that the rights, duties, privileges and functions of the office of an attorney are
inherently incompatible with the high official functions, duties, powers, discretion and privileges of a sitting judge. It
also aims to ensure that judges give their full time and attention to their judicial duties, prevent them from extending
favors to their own private interests, and assure the public of their impartiality in the performance of their functions.
These objectives are dictated by a sense of moral decency and desire to promote the public interest.31

Thus, an attorney who accepts an appointment to the Bench must accept that his right to practice law as a member
of the Philippine Bar is thereby suspended, and it shall continue to be so suspended for the entire period of his
incumbency as a judge. The term practice of law is not limited to the conduct of cases in court or to participation in
court proceedings, but extends to the preparation of pleadings or papers in anticipation of a litigation, the giving of
legal advice to clients or persons needing the same, the preparation of legal instruments and contracts by which
legal rights are secured, and the preparation of papers incident to actions and special proceedings.32

To the Court, then, Judge Malanyaon engaged in the private practice of law by assisting his daughter at his wife’s
administrative case, coaching his daughter in making manifestations or posing motions to the hearing officer, and
preparing the questions that he prompted to his daughter in order to demand that Atty. Eduardo Loria, collaborating
counsel of the complainants’ principal counsel, should produce his privilege tax receipt. Judge Malanyaon did so
voluntarily and knowingly, in light of his unhesitating announcement during the hearing that he was the counsel for
Atty. Katrina Malanyaon, the counsel of the respondent, as his response to the query by the opposing counsel why
he was seated next to Atty. Malanyaon thereat.

Third was Judge Malanyaon’s admission that he had already engaged in the private practice of law even before the
incident now the subject of this case by his statement in his comment that "it is strange for complainants to take
offense at my presence and accuse me of practicing law during my stint as a judge when before the bad blood
between my wife and her sibling and nephew erupted, I helped them out with their legal problems gratis et amore
and they did not complain of my practicing law on their behalf."33 He thereby manifested his tendencies to disregard
the prohibition against the private practice of law during his incumbency on the Bench.

Any propensity on the part of a magistrate to ignore the ethical injunction to conduct himself in a manner that would
give no ground for reproach is always worthy of condemnation.34 We should abhor any impropriety on the part of
judges, whether committed in or out of their courthouses, for they are not judges only occasionally. The Court has
fittingly emphasized in Castillo v. Calanog, Jr.:35

The Code of Judicial Ethics mandates that the conduct of a judge must be free of a whiff of impropriety not only with
respect to his performance of his judicial duties, but also to his behavior outside his sala and as a private individual.
There is no dichotomy of morality; a public official is also judged by his private morals. The Code dictates that a
judge, in order to promote public confidence in the integrity and impartiality of the judiciary, must behave with
propriety at all times. As we have very recently explained, a judge’s official life cannot simply be detached or
separated from his personal existence. Thus:

Being a subject of constant public scrutiny, a judge should freely and willingly accept restrictions on conduct that
might be viewed as burdensome by the ordinary citizen.

A judge should personify judicial integrity and exemplify honest public service. The personal behavior of a judge,
both in the performance of official duties and in private life should be above suspicion.

Fourth was Judge Malanyaon’s display of arrogance during the hearing, as reflected by his reaction to the opposing
counsel’s query on his personality to sit at the counsel table at the hearing, to wit:

I am the counsel of the complainant, ah, of the respondent’s counsel, I am Judge Malanyaon. I am assisting her.
And so what?!!
Judge Malanyaon’s uttering "And so what?" towards the opposing counsel evinced his instant resentment towards
the adverse parties’ counsel for rightly challenging his right to be sitting on a place reserved for counsel of the
parties. The utterance, for being made in an arrogant tone just after he had introduced himself as a judge, was
unbecoming of the judge that he was, and tainted the good image of the Judiciary that he should uphold at all
times.36 It is true that the challenge of the opposing counsel might have slighted him, but that was not enough to
cause him to forget that he was still a judge expected to act with utmost sobriety and to speak with self-restraint. He
thereby ignored the presence of the hearing officer, appearing to project that he could forsake the decorum that the
time and the occasion rightly called for from him and the others just because he was a judge and the other side was
not. He should not forget that a judge like himself should be the last person to be perceived by others as a petty and
sharp-tongued tyrant.

Judge Malanyaon has insisted that his actuations were excused by his filial obligation to assist his daughter, then
only a neophyte in the Legal Profession. We would easily understand his insistence in the light of our culture to be
always solicitous of the wellbeing of our family members and other close kin, even risking our own safety and lives
in their defense. But the situation of Judge Malanyaon was different, for he was a judicial officer who came under
the stricture that uniformly applied to all judges of all levels of the judicial hierarchy, forbidding him from engaging in
the private practice of law during his incumbency, regardless of whether the beneficiary was his wife or daughter or
other members of his own family.

3. What is the proper penalty?

Judge Malanyaon had been previously sanctioned by the Court on the following three occasions, namely: (a) A.M.
No. RTJ-93-1090, with admonition for gross ignorance of the law and unreasonable delay in resolving motions;37 (b)
A.M. No. RTJ-99-1444, with reprimand for failure to resolve motions;38 and (c) A.M. No. RTJ-02-1669, with a fine of
₱20,000.00 (coupled with a stern warning that a repetition of the same or similar act would be dealt with more
severely) for conduct unbecoming of a judge.39 He had other administrative cases that were dismissed.40 Of the
three administrative cases that merited sanctions, however, only the third should be considered as aggravating
herein because it involved the similar offense of conduct unbecoming of a judge for which he had been given the
stern warning of a more severe penalty upon a repetition.

However, our uniform treatment of administrative sanctions as having the nature of liabilities akin to those in criminal
cases now brings us to offset such aggravating circumstance with the apparent fact that the actuations of Judge
Malanyaon complained of had not been motivated by bad faith, or by any malice towards another. Indeed, he did not
intend to thereby cause any prejudice to another, having so acted from a sincere, albeit misplaced, desire to go to
the help of his wife and daughter.

Accordingly, the Court deems it condign and proper to mitigate the fine of ₱50,000.00 recommended by the Court
Administrator by imposing on Judge Malanyaon a fine of ₱40,000.00. With his disability retirement from the
Judiciary having been earlier granted by the Court, the fine shall be deducted from his remaining retirement benefits.

WHEREFORE, the Court finds and pronounces JUDGE NILO A. MALANYAON, Presiding Judge of Branch 32 of
the Regional Trial Court in Pili, Camarines Sur, administratively liable for conduct unbecoming of a Judge, and
penalizes him with a fine of ₱40,000.00.

SO ORDERED.

LUCAS P. BERSAMIN
Associate Justice
 Republic of the Philippines
SUPREME COURT
Manila

FIRST DIVISION

A.M. OCA IPI No. 04-1606-MTJ September 19, 2012

ATTY. ARTURO JUANITO T.MATURAN, Complainant,

vs.
JUDGE LIZABETH GUTIERREZ-TORRES, Respondent.

DECISION

BERSAMIN, J.:

A judge must exert every effort to timely rule upon a case submitted for decision. If she thinks that she would need a
period to decide a case or to resolve an issue longer than what the Constitution prescribes, she may request an
extension from the Court to avoid administrative sanctions.

Antecedents

On August 12, 2004, complainant Atty. Arturo Juanita T. Maturan (Maturan), the counsel for the private complainant
in Criminal Case No. 67659 entitled People v. Anicia C. Ventanilla, filed a sworn complaint1 against Judge Lizabeth
Gutierrez-Torres, the former Presiding Judge of Branch 60 of the Metropolitan Trial Court in Mandaluyong City,
charging her with unjustifiably delaying the rendition of the decision in his client’s criminal case. Atty. Maturan
averred that the criminal case had remained pending and unresolved despite its having been submitted for decision
since June 2002 yet, pertinently alleging in detail as follows:

Court Record show that-

1. 10 April 2002- This is the date of the last hearing during which the defense counsel, Atty. Williard S.
Wong, manifested in open court that he has no more documentary exhibit to offer and accordingly rested his
case. The Honorable Court then ordered the parties to file their respective memorandum after which, the
case was ordered submitted for decision.

2. 03 June 2002- The prosecution filed its MEMORANDUM. (Copy attached as ANNEX "A") The defense
waived filing any MEMORANDUM as court records show that up to this day, the defense counsel, Atty.
Wong, did not file any.

3. 09 December 2002- The prosecution filed a MOTION TO DECIDE case dated 09 December 2002. (Copy
attached as ANNEX "B") The Honorable Presiding Judge simply sat on said motion and did not take any
action thereto.

4. 10 July 2003- The prosecution filed a SECOND MOTION TO DECIDE CASE dated 10 July 2003 (Copy
attached as ANNEX "C"). The Honorable Presiding Judge denied it for the alleged failure to comply with the
ORDER dated 03 May 2001. Said ORDER involves sur-rebuttal evidence, however, this has been rendered
moot by the proceedings held on 10 April 2002. Court records would show that as mentioned above, Atty.
Wong manifested in open court that the defense is already resting its case. In fact, the Honorable Court
thereafter ordered the parties to file their respective memorandum and ordered the case submitted for
decision thereafter.

5. 04 February 2004- The prosecution filed a THIRD MOTION TO DECIDE CASE dated 04 February 2004
(Copy attached as ANNEX "D").

6. 11 August 2004- In the morning of 11 August 2004, undersigned thoroughly reviewed the court records
and discovered that the Hon. Presiding Judge has not taken any action to the motion. Records also show
that the Hon. Presiding Judge has not yet made a decision on the case despite the lapse of more than 2
years. When undersigned came back to again examine the records in the afternoon of 11 August 2004, he
was surprised to be shown with a newly-signed ORDER also dated 11 August 2004 stating completion of
the transcript of records and considered the case is now supposedly "submitted for decision".2

Atty. Maturan stated that Judge Gutierrez-Torres’ failure to render the judgment within the 90-day period from
submission of the case for decision violated Canon 3, Rule 3.05 of the Code of Judicial Conduct and the
Constitution, and constituted gross inefficiency.3
On August 27, 2004, the Office of the Court Administrator (OCA) directed Judge Gutierrez-Torres through its first
indorsement of the complaint to submit her comment, and also to show cause why no disciplinary action should be
taken against her for her violation of her professional responsibility as a lawyer pursuant to the Resolution dated
September 17, 2002 issued in A.M. No. 02-9-02-SC.4

On September 24, 2004, Judge Gutierrez-Torres implored the OCA to grant her a 20-day extension of the period
within which to submit her comment. Despite her request being granted, she failed to submit a comment, causing
the Court to issue on June 29, 2005 its Resolution "to REQUIRE the respondent to (a) SHOW CAUSE why she
should not be administratively dealt with for refusing to submit her comment despite the two directives from the
Office of the Court Administrator; and (b) SUBMIT the required COMMENT, both within five (5) days from receipt
hereof, failing which the Court shall take the necessary action against her and decide the administrative complaint
on the basis of the record on hand." 5

The records show that Judge Gutierrez-Torres sought four more extensions of the period within which to submit a
comment; and that the Court granted her further requests through its Resolutions dated September 12,
2005,6October 19, 2005,7 February 8, 2006,8 and March 21, 2007.9 The Court likewise granted her request to
photocopy documents relevant to the complaint.10 Notwithstanding the liberality of the Court in granting several
extensions, she still did not submit a comment. In its Memorandum dated August 25, 2011,11 the OCA rendered the
following findings, to wit:

The respondent has consistently exhibited indifference to the Court’s Resolutions requiring her to comment on the
instant complaint. Her behavior constitutes gross misconduct and blatant insubordination, even outright disrespect
for the Court. It must be borne in mind that a resolution of the Court requiring comment on an administrative
complaint is not a mere request, nor should it be complied with partially, inadequately or selectively. Failure by the
respondent to comply betrays not only a recalcitrant streak in character, but also disrespect for the Court’s lawful
order and directive.

Moreover, she has no defense whatsoever to refute the charges against her. The records are replete with
documentary evidence that in Criminal Case No. 67659, entitled "People of the Philippines vs. Anicia C. Ventenilla,"
she miserably failed to decide the said case within the reglementary period of 90 days. In fact, three (3) successive
Motions to Decide Case dated 9 December 2002, 10 July 2003 and 4 February 2004, were filed by the prosecution
without any action on the part of the respondent. By the time the instant administrative complaint was filed on 12
August 2004, more than two (2) years had already elapsed since the said criminal case was submitted for decision.
Clearly, the respondent is not only guilty of insubordination and gross inefficiency, but also
of grave and serious misconduct, having violated Canon 3, Rule 3.05 of the Code of Judicial Conduct and Section
15, Article VIII of the 1987 Constitution.

Considering the gravity of the above-mentioned offenses committed by the respondent, the penalty of dismissal
from the service is commensurate, imposing the penalty of dismissal from the service on the respondent will be in
consonance with the ruling of the Court in the consolidated cases of Alice Davila vs. Judge Joselito S.D.
Generoso and Leticia S. Santos vs. Judge Joselito S.D. Generoso, to wit:

"The failure of the respondent judge to comply with the show-cause resolutions aforecited constitutes
‘grave and serious misconduct affecting his fitness and worthiness of the honor and integrity attached to his
office. It is noteworthy that respondent judge was afforded several opportunities to explain his failure to decide the
subject cases long pending before his court and to comply with the directives of the Court, but he has failed, and
continues to fail, to heed the orders of the Court; a glaring proof that he has become disinterested in his position in
the judicial system to which he belongs.

It is beyond cavil that the inability of respondent judge to decide the cases in question within the
reglementary period of ninety (90) days from their date of submission, constitutes gross inefficiency and is
violative of Rule 3.05, Canon 3 of the Code of Judicial Conduct, which provides that ‘[a] judge shall dispose of
the court’s business promptly and decide cases within the required periods.’

The separation of the respondent judge from the service is indeed warranted, if only to see to it that the
people’s trust in the judiciary be maintained and speedy administration of justice be assured."

It bears mentioning that the instant case is not an isolated one. Several administrative cases against the respondent
are still pending before the Court, all of which invariably charge her with gross misconduct and inexcusable
inefficiency, among others, for failing to decide cases or resolve pending incidents for inordinately long periods of
time. in similar lackadaisical fashion, the respondent has ignored the orders of the Court directing her to comment
on said complaints. She has likewise been previously penalized with fines and suspensions. However, the
respondent Judge has not shown any sign of remorse or contrition, even as the administrative complaints against
her piled up. And worse, in her sala, hundreds of criminal and civil cases submitted for decision and/or resolution
remained untouched and unresolved, gathering dust as they aged.
Finally, on 23 November 2010, in three (3) consolidated cases against the respondent, docketed as A.M. No. MTJ-
08-1719, A.M. No. MTJ-08-1722, and A.M. No. MTJ-08-1723, the Court, in a Per Curiam Decision, finally
DISMISSED the respondent from the service with forfeiture of all retirement benefits except earned leave and
vacation benefits, with benefits, with prejudice to employment in any branch of the government or any of its
instrumentalities including government-owned and controlled corporations. The court ruled therein that:

"The magnitude of her transgressions in the present consolidated cases – gross inefficiency, gross ignorance of the
law, dereliction of duty, violation of the Code of Judicial Conduct, and insubordination, taken collectively, cast a
heavy shadow on her moral, intellectual and attitudinal competence. She has shown herself unworthy of the judicial
robe and place of honor reserved for guardians of justice. Thus, the Court is constrained to impose upon her the
severest of administrative penalties – dismissal from the service, to assure the people’s faith in the judiciary and the
speedy administration of justice."

Even though the respondent has been dismissed from the service, this does not necessarily mean that she cannot
be held administratively liable in the instant case. In its fairly recent Decision in Narag vs.Manio, the Court ruled that:

"Unfortunately for the respondent, this did not render her case moot. She must not be allowed to evade
administrative liability by her previous dismissal from the service. Thus, for this case involving additional
serious offenses, the Court finds it proper to impose upon her a fine of ₱ 20,000 to be deducted from her accrued
leave credits in lieu of dismissal from the service."

Upon the foregoing findings, the OCA recommended that Judge Gutierrez-Torres be administratively sanctioned as
follows:

2. Respondent Lizabeth Gutierrez-Torres be found GUILTY of INSUBORDINATION, GROSS

INEFFICIENCY, and GRAVE and SERIOUS MISCONDUCT;

3. In view of her previous dismissal from the service, a FINE of ₱ 20,000.00 instead be imposed upon her,
to be deducted from her accrued leave credits;

Ruling: We adopt the findings and uphold the recommendations of the OCA.

Article VIII, Section 15(1) of the 1987 Constitution requires that all cases or matters filed after the effectivity of the
Constitution must be decided or resolved within twenty-four months from date of submission for the Supreme Court,
and, unless reduced by the Supreme Court, twelve months for all lower collegiate courts, and three months for all
other lower courts. Thereby, the Constitution mandates all justices and judges to be efficient and speedy in the
disposition of the cases or matters pending in their courts.

Reiterating the mandate, the New Code of Judicial Conduct for the Philippine Judiciary requires judges to "devote
their professional activity to judicial duties, which include xxx the performance of judicial functions and
responsibilities in court and the making of decisions xxx,"12 and to "perform all judicial duties, including the delivery of
reserved decisions, efficiently, fairly and with reasonable promptness."13 Likewise, Rule 3.05, Canon 3 of the Code of
Judicial Conduct imposes on all judges the duty to dispose of their courts’ business promptly and to decide cases
within the required periods.

These judicial canons directly demand efficiency from the judges in obvious recognition of the right of the public to
the speedy disposition of their cases. In such context, the saying justice delayed is justice denied becomes a true
encapsulation of the felt need for efficiency and promptness among judges.

To fix the time when a case pending before a court is to be considered as submitted for decision, the Court has
issued Administrative Circular No. 28 dated July 3, 1989, whose third paragraph provides:

A case is considered submitted for decision upon the admission of the evidence of the parties at the termination of
the trial. The ninety (90) day period for deciding the case shall commence to run from submission of the
case for decision without memoranda; in case the court requires or allows its filing, the case shall be
considered submitted for decision upon the filing of the last memorandum or upon the expiration of the
period to do so, whichever is earlier. Lack of transcript of stenographic notes shall not be a valid reason to interrupt
or suspend the period for deciding the case unless the case was previously heard by another judge not the deciding
judge in which case the latter shall have the full period of ninety (90) days for the completion of the transcripts within
which to decide the same.

The time when a case or other matter is deemed submitted for decision or resolution by a judge is, therefore, settled
and well defined. There is no longer any excuse for not complying with the canons mandating efficiency and
promptness in the resolution of cases and other matters pending in the courts. Hence, all judges should be mindful
of the duty to decide promptly, knowing that the public’s faith and confidence in the Judiciary are no less at stake if
they should ignore such duty. They must always be aware that upon each time a delay occurs in the disposition of
cases, their stature as judicial officers and the respect for their position diminish. The reputation of the entire
Judiciary, of which they are among the pillars, is also thereby undeservedly tarnished.
A judge like Judge Gutierrez-Torres should be imbued with a high sense of duty and responsibility in the discharge
of the obligation to promptly administer justice. She must cultivate a capacity for promptly rendering her decisions.
Should she anticipate that she would need a period longer than what the Constitution and the issuances of the Court
prescribe within which to render her decision or resolution, she should request a proper extension of the period from
the Court, through the OCA, and lay out in the request the justification for her inability. Yet, she did not at all do so in
Criminal Case No. 67659 entitled People v. Anicia C. Ventanilla. She was clearly guilty of gross inefficiency,
especially because her inability to decide the case within the required period became absolutely devoid of excuse
after she did not bother to proffer any explanation for her inability.

The gross inefficiency of Judge Gutierrez-Torres warranted the imposition of administrative sanction against
her.14Rule 140 of the Rules of Court, as amended by A.M. No. 01-8-10-SC, classifies undue delay in rendering a
decision or order as a less serious charge punishable by either: (a) suspension from office without salary and other

benefits for not less than one nor more than three months; or (b) a fine of more than ₱ 10,000.00 but not exceeding
₱ 20,000.00. We adopt the OCA’s recommendation as to the fine in the maximum of ₱ 20,000.00, considering that
she had already been dismissed from the service due to a similar offense of unjustified delay in rendering
decisions.15

As a final word, the Court must focus attention to the indifference of Judge Gutierrez-Torres towards the Court’s
directive for her to file her comment despite the repeated extensions of the period to do so liberally extended by the
Court at her request. Such indifference reflected not only that she had no credible explanation for her omission, but
also that she did not care to comply with the directives of the Court. The latter represents an attitude that no judge
should harbor towards the Highest Tribunal of the country, and for that reason is worse than the former. She should
not be emulated by any other judge, for that attitude reflected her lack of personal character and ethical merit. To be
sure, the Court does not brook her insubordination, and would do more to her had she not been removed from the
Judiciary. Accordingly, the Court must still hold her to account for her actuations as a member of the Law
Profession, which is what remains to be done after first giving her the opportunity to show cause why she should
not.1âw phi1

WHEREFORE, the Court finds former Metropolitan Trial Court JUDGE LIZABETH GUTIERREZ-TORRES guilty of
gross inefficiency, and imposes on her a fine of F20,000.00, to be deducted from her accrued leave credits, if any.

The Court orders JUDGE GUTIERREZ-TORRES to show cause in writing within ten days from notice why she
should not be suspended from membership in the Integrated Bar of the Philippines for her act of insubordination
towards the Court.

The Court directs the Employees Leave Division, Office of Administrative Services-OCA to compute the balance of
Judge GutierrezTorres' earned leave credits and forward the same to the Finance Division, Fiscal Management
Office-OCA which shall compute its monetary value.

SO ORDERED.

LUCAS P. BERSAMIN
Associate Justice
 Republic of the Philippines
SUPREME COURT
Manila

EN BANC

A.M. No. 08-5-305-RTC July 9, 2013

RE: FAILURE OF FORMER JUDGE ANTONIO A. CARBONELL TO DECIDE CASES SUBMITTED FOR
DECISION AND TO RESOLVE PENDING MOTIONS IN THE REGIONAL TRIAL COURT, BRANCH 27, SAN
FERNANDO, LA UNION.

RESOLUTION

BERSAMIN, J.:

This administrative case originates from the judicial audit conducted by the Office of the Court Administrator (OCA)
on March 3 and 4, 2008 in the Regional Trial Court of San Fernando, La Union, Branch 27, in view of the disability
retirement of Presiding Judge Antonio A. Carbonell on December 31, 2007.

According to the Audit Team’s Report, Branch 27 had a total caseload of 231 cases, consisting of 147 criminal
cases and 84 civil cases, and Judge Carbonell failed to decide 41 criminal cases (one inherited) and 22 civil cases
(four inherited), namely: Criminal Case Nos. 1183, 4559, 5117, 3532, 3672, 5165, 5007, 5946, 6934, 5763, 7014,
5991, 4724, 6311, 6076, 4789, 6297, 5424, 4928, 6403, 6816, 5635, 5666, 5134, 5865, 6284, 6454, 5394, 6770,
5375, 5356, 7557, 5940, 6311, 6333, 7729, 7111, 6325, 6068, 6517, and 7766; and Civil Case Nos. 3009, 4564,
4563, 4714, 3647, 4362, 6041, 4798, 4561, 6989, 2882, 6185, 7153, 7163, LRC 2332, SCA 7198, 7310, 3487,
7327, 7331, 7298, and 7323.1

Judge Carbonell was also reported to have failed to resolve pending motions or incidents in four criminal cases and
12 civil cases, to wit: Criminal Case Nos. 7559, 6409, 7787, and 7788; and Civil Case Nos. 4793, LRC 1308, 7064,
4973, SP 2901, SP 2952, AC 1797, 7100, 7152, 7060, SP 2986, and SP 2987.2

In a Memorandum dated May 15, 2008, the OCA recommended to the Court that a fine of ₱50,000.00 be imposed
upon Judge Carbonell for gross inefficiency for failing to promptly decide the cases and to resolve pending motions
and incidents.3

On June 17, 2008, the Court directed the Clerk of Court to furnish Judge Carbonell with a copy of the Audit Team’s
Report, and ordered him to submit his comment on the report within ten days from notice.4

Not having received the comment from Judge Carbonell despite the lapse of the time given, the Court resolved on
September 21, 2010 to require him to show cause why he should not be disciplinarily dealt with or held in contempt.5

Judge Carbonell replied,6 stating that he had incorporated his comment/compliance to the June 17, 2008 resolution
in the letter dated July 17, 2008 (Re: Very Urgent Request for Release of Disability Retirement Benefits and Money
Value of Accrued Leave Credits) he had sent to Chief Justice Reynato S. Puno.7 He remarked that the Court had
actually granted his request for the payment of his disability retirement benefits subject to the retention of
₱200,000.00 pending resolution of the pending administrative cases against him.8

In his July 17, 2008 letter to Chief Justice Puno, Judge Carbonell surmised that the Audit Team might have
overlooked the fact that he had inherited some of the undecided cases from the predecessor judge; that said cases
had no transcripts of stenographic notes, because of which he was impelled to require the parties to submit their
respective memoranda; that the cases would only be considered submitted for decision after the parties would have
filed their respective memoranda; and that he had undergone a quadruple heart bypass operation in 2005 that had
adversely affected his pace in deciding the cases.

On November 23, 2010, the Court referred Judge Carbonell’s letter to the OCA for evaluation, report, and
recommendation.9

In its Memorandum dated February 2, 2011,10 the OCA reiterated its recommendation to impose a fine of
₱50,000.00 on Judge Carbonell, noting that he had failed to render any valid reason for his delay in deciding the
cases submitted for decision and in resolving the pending motions or incidents in other cases. The OCA noted that
only five cases submitted for decision had been inherited; and that the case records did not bear any requests for
extension of time or any directive for the transcription of stenographic notes. It stressed that heavy caseload would
not justify the failure to promptly decide and resolve cases because he could have simply asked the Court for an
extension of time.

The recommendation of the OCA is well-taken, subject to the modification of the penalty to be imposed.

As a frontline official of the Judiciary, a trial judge should at all times act with efficiency and probity. He is duty-bound
not only to be faithful to the law, but also to maintain professional competence. The pursuit of excellence ought
always to be his guiding principle. Such dedication is the least that he can do to sustain the trust and confidence that
the public have reposed in him and the institution he represents.11

The Court cannot overstress its policy on prompt disposition or resolution of cases.12 Delay in the disposition of
cases is a major culprit in the erosion of public faith and confidence in the judicial system, as judges have the sworn
duty to administer justice without undue delay.13 Thus, judges have been constantly reminded to strictly adhere to
the rule on the speedy disposition of cases and observe the periods prescribed by the Constitution for deciding
cases, which is three months from the filing of the last pleading, brief or memorandum for lower courts.14 To further
impress upon judges such mandate, the Court has issued guidelines (Administrative Circular No. 3-99 dated
January 15, 1999) that would insure the speedy disposition of cases and has therein reminded judges to
scrupulously observe the periods prescribed in the Constitution.

Nonetheless, the Court has been mindful of the plight of our judges and understanding of circumstances that may
hinder them from promptly disposing of their businesses. Hence, the Court has allowed extensions of time to decide
cases beyond the 90-day period. All that a judge needs to do is to request and justify an extension of time to decide
the cases, and the Court has almost invariably granted such request.

Judge Carbonell failed to decide a total of 63 cases and to resolve 16 pending motions or incidents within the 90-
day reglementary period. He intimated that his poor health affected his pace in deciding the cases. Had such been
the case, then he should have explained his predicament to the Court and asked for an extension of time to decide
the cases. Unfortunately, he failed to do so.

Judge Carbonell claims that some of the inherited cases had no transcripts of stenographic notes, thereby
preventing him from resolving the cases on time. He posits that a case would not be considered submitted for
decision if the parties did not yet file their respective memoranda. 1âwphi 1

The Audit Team’s Report shows that, in an apparent attempt to suspend the running of the 90-day period to decide
the cases, Judge Carbonell liberally gave the parties in most of the overdue cases several extensions of time to file
their respective memoranda. Some extensions were even for indefinite periods, with the parties being simply given
"ample time to file their memo," as the relevant court orders stated.

In view of the foregoing, Judge Carbonell’s excuses are futile in the light of the following provisions of Administrative
Circular No. 28, dated July 3, 1989, viz:

(3)

A case is considered submitted for decision upon the admission of the evidence of the parties at the termination of
the trial. The ninety (90) days period for deciding the case shall commence to run from submission of the case for
decision without memoranda; in case the Court requires or allows its filing, the case shall be considered submitted
for decision upon the filing of the last memorandum or the expiration of the period to do so, whichever is earlier.
Lack of transcript of stenographic notes shall not be a valid reason to interrupt or suspend the period for deciding
the case unless the case was previously heard by another judge not the deciding judge in which case the latter shall
have the full period of ninety (90) days from the completion of the transcripts within which to decide the same.

(4)

The court may grant extension of time to file memoranda, but the ninety (90) day period for deciding shall not be
interrupted thereby.

Without a doubt, Judge Carbonell’s failure to decide several cases within the reglementary period, without justifiable
and credible reasons, constituted gross inefficiency, warranting the imposition of administrative sanctions,15 like
fines. The fines imposed have varied in each case, depending chiefly on the number of cases not decided within the
reglementary period and other factors, including the presence of aggravating or mitigating circumstances like the
damage suffered by the parties from the delay, the health condition and age of the judge, etc.16 Thus, in one case,
the Court mitigated the liability of a Judge who had been suffering from illnesses and who had later retired due to
disability, and imposed upon him a fine of ₱20,000.00 for failure to decide 31 cases.17

Considering that Judge Carbonell similarly retired due to disability, the Court believes that his poor health condition
greatly contributed to his inability to efficiently perform his duties as a trial judge. That mitigated his administrative
liability, for which reason the Court reduces the recommended penalty of fine from ₱50,000.00 to ₱20,000.00.

WHEREFORE, Retired Judge Antonio A. Carbonell is ORDERED to pay a fine of ₱20,000.00 to be deducted from
the ₱200,000.00 that was withheld from his retirement benefits, and the balance to be immediately released to him.

SO ORDERED.

Sereno, C.J. Carpio, Velasco, Jr., Leonardo-De Castro, Peralta, Del Castillo, Abad, Villarama, Jr., Perez,
Mendoza, Reyes, Perlas-Bernabe, and Leonen, JJ., concur.
Brion, J., on leave.
A.M. OCA IPI No. 02-1321-P CONCERNED CITIZEN VS CATENA

BERSAMIN, J.:
Gross dishonesty on the part of an employee of the Judiciary is a very serious offense that must be severely punished. Dismissal
may be meted on the employee, unless she had meanwhile ceased to be an employee, in which case a high fine shall be imposed.

Antecedents

This administrative case stemmed from an undated anonymous letter-complaint charging respondent Nonita Catena (Catena), a
Court Stenographer III of Branch 50 of the Regional Trial Court in Puerto Princesa City, Palawan (RTC) with gross dishonesty she
allegedly committed in connection with her Civil Service eligibility accusing her of having caused another person to take the Civil
Service Eligibility Examination in her stead.

The letter reads,[1] thus:

Sir:

I would like to bring to your attention an anomaly brought about by one Noneta Catina.

She is permanently employed as stenographer under the Regional Trial Court (RTC) Branch 50 here in the Justice Hall of Puerto
Princesa City.

In 1998, somebody took the stenographer's examination in her behalf in Leyte. She allegedly passed said examination that gave her
the permanent position of stenographer in 1998.

May I request for a verification and if found guilty, I hope CSC will do something in fairness to those who are taking your
Stenographer's examination.

Thank you very much and more power!

Concerned Citizen

On January 18, 2002, Justice Jose P. Perez, a Member of this Court, as Deputy Court Administrator, forwarded the complaint
against Catena for investigation by the Legal Division of the Office of the Court Administrator (OCA). The investigation revealed
discrepancies between the pictures, signatures and other details contained in the Career Service Examination permit submitted to
the Civil Service Commission (CSC), on one hand, and the 201 file of Catena, on the other.[2]

On February 21, 2002, Justice Presbitero J. Velasco, a Member of this Court, the Court Administrator then, directed Catena to
comment within ten days on the anonymous complaint.[3]

Catena implored the OCA for a 30-day extension of the period within which to submit her comment.[4] Despite her request being
granted, she failed to submit a comment, causing the Court to issue a tracer letter on September 24, 2002,[5] but still enjoining her
to comply with the previous directive to file a comment within five days from notice, or else the complaint would be resolved
without her comment.

On August 13, 2003, the OCA recommended that a resolution addressed to Catena's home and office addresses requiring her to
comment within 10 days from notice be issued.[6] On October 1, 2003, therefore, the Court, after noting the anonymous complaint,
required Catena to comment on it within 10 days from notice.[7]

Catena still failed to comment on the complaint thereafter, prompting the Court to require her on March 17, 2004 to show cause
why she should not be disciplinarily dealt with or held in contempt for such failure, and to comply with the October 1, 2003
resolution by submitting the comment within 10 days.[8] Subsequently, on November 24, 2004, the Court issued another resolution
to reiterate the show-cause order of March 17, 2004.[9]

On March 9, 2005, however, Judge Nelia Yap-Fernandez of the RTC formally informed the Court that Catena had already resigned
from her position effective on January 2, 2003.[10]

In view of this communication, the Court resolved on April 11, 2005, to await the compliance of Catena with the resolution dated
November 24, 2004.[11] On September 26, 2005, the Court required Judge Yap-Fernandez to provide Catena's current and correct
address within 15 days from notice because Catena continued to ignore the previous resolutions.[12]

Eventually on February 12, 2007, the Court directed the Branch Clerk of Court of the RTC to provide Catena's current and correct
address within 10 days[13] because of Judge Yap-Fernandez's intervening disability retirement.[14] In turn, Ms. Jessie C. Gipal, as
Officer-in-Charge of the RTC, complied, and furnished Catena's current and correct address to be at Purok Sandiwa, Brgy. New
Princess 5300, Puerto Princesa City,[15] which compliance was duly noted on June 25, 2007.[16] Subsequently, on February 4, 2008,
the Court considered as served on Catena the previous resolutions of June 25 2007, October 1, 2003, March 17, 2004 and November
24, 2004 because of the return on the service at that address being "Return to Sender-unclaimed." [17]

On April 28, 2008, the Court resolved anew to await Catena's comment,[18] and decided to dispense with her comment only on
August 20, 2008, and to refer the complaint to the OCA for evaluation, report and recommendation.[19]

The complaint was later on re-docketed as a regular administrative matter on the basis of the recommendation made on October 7,
2009 by Justice Perez, then already the Court Administrator, who recommended that Catena be held liable for dishonesty and be
dismissed from the service with prejudice to re-employment in any branch, agency, instrumentality of the government, including
government owned and controlled corporations.[20]

On October 26, 2009, the Court required Catena to manifest if she was willing to submit the case for resolution on the basis of the
records and pleadings filed within 10 days from notice.[21] On December 13, 2010, the Court resent the resolution because the postal
carrier reported that Catena as the addressee had been "out of town" and did not receive the mail matter. [22]

After the subsequent attempt to serve still failed because, as noted on the envelope, Catena as the addressee had "moved out," the
Court deemed the resolution of October 26, 2009 as served on her on April 13, 2011.[23]

Still, on May 30, 2011,[24] the Court directed the Director of the National Bureau of Investigation (NBI) to locate the whereabouts of
Catena and to submit a report thereon within 10 days from notice.

On August 5, 2011, Head Agent (HA) Rosauro D. Bautista of the NBI District Office in Puerto Princesa City sent the following report,
viz:

Respondent, NONITA V. CATENA was located at her residence in Purok Sandiwa, Barangay Tiniguiban, Puerto Princesa but refused
to sign the herein NOTICE, nevertheless received the document. Agent of the Puerto Princesa District Office served the herein
NOTICE on respondent on July 25, 2011 and the same was communicated to the Office of the Deputy Director for Operations Services
in Manila. Photograph of herein respondent was taken for identitifcation and reference purposes.[25]
On August 9, 2011, NBI Director Magtanggol Gatdula, citing and quoting the foregoing report of HA Bautista, submitted his
compliance with the resolution of May 30, 2011,[26] praying that the compliance be accepted.

Hence, we resolve.

Ruling

Based on its investigation, the OCA found discrepancies between the pictures, signatures and other details contained in Catena's
Career Service Examination permit submitted to the CSC, on one hand, and those found in her 201 file,[27] on the other; and
concluded that she was thereby guilty of gross dishonesty. It recommended her dismissal from the service, with prejudice to re-
employment in any branch, agency, instrumentality or agency of the government including government-owned and -controlled
corporations.[28]

The findings and recommendation of the OCA, being based on established facts, are well-taken, but we modify the recommended
sanction in view of Catena's intervening resignation from the service effective on January 2, 2003.

Let it be said at the outset that Catena's resignation from the service did not cause the Court to lose its jurisdiction to proceed
against her in this administrative case. Her cessation from office by virtue of her intervening resignation did not warrant the
dismissal of the administrative complaint against her, for the act complained of had been committed when she was still in the
service. Nor did such cessation from office render the administrative case moot and academic. Indeed, the Court's jurisdiction at
the time of the filing of the administrative complaint was not lost because the respondent had ceased in office during the pendency
of the case.[29] Otherwise, exacting responsibility for administrative liabilities incurred would be easily avoided or evaded.

The point of the complaint against Catena is that she misrepresented in her Personal Data Sheet (PDS) that she held a Sub-
Professional Civil Service Eligibility, but in truth another person had taken the Civil Service Examination in her place. Her claim
that she held a Sub-Professional Civil Service Eligibility with a rating of 86.48%, as stated in her PDS submitted to the Court, was,
therefore, entirely false.[30]

Attempting to disprove the charge that she did not take the eligibility examination herself, Catena submitted her approved leave
application and her daily time records corresponding to the period of the eligibility examination. Her submission was really not
enough, however, because said documents did not establish that she had herself taken the examination, or that she had been
personally at the testing site on the date of the examination. At best, the approved leave application attested only that she had
applied for a leave of absence from work, and that her application had been approved, while her daily time records affirmed only
that she did not report to her office on the dates that she had supposedly gone on leave.

Perhaps anticipating that her submission of the daily time records and approved leave application would not suffice to support her
explanation, she stated in her request for the 30-day extension to file the comment that she would be needing the time to gather the
documents she would submit as her evidence to disprove the charge of gross dishonesty,[31] specifically: (1) a certification from the
head office of the Negros Navigation Company in Manila, to show that she had travelled from Puerto Princesa City to Iloilo City,
and from Cebu City to Leyte on the date of the examination; (2) affidavits of residents of Leyte attesting to her being in the locality
of the examination and to her taking the examination herself; (3) records on file with the CSC office in Leyte; and (4) other evidence
of similar nature. But ultimately she did not come forward with the promised documentary evidence, notwithstanding her
awareness of the desire of the Court to hear her side.

Compounding Catena's situation was her unusual silence on the complaint despite the very ample opportunity accorded her to
comment. Being conscious of the gravity of the complaint against her, she should have come forward to explain her side. In that
regard, too, we have to stress that the directives for her to comment were not mere requests to be lightly taken, but firm commands
to be obeyed without the least delay.[32] What her silence signified was that she had no desire to clear her name and to save her
employment in the Judiciary. Worse, her silence now also signifies that she had nothing to say in her own defense, because it was
naturally expected of her based on the natural instinct of man for self-preservation to resist the serious charge if it was untrue and
unfair. Her silence in the face of the accusation of gross dishonesty was justifiably construed as her implied admission of the truth
thereof.[33]

Considering that Catena's misrepresentation of her eligibility concerned a material fact that enabled her to secure her appointment
equated to her deliberate fabrication of the truth concerning her eligibility, she was guilty of gross dishonesty. She should not be
allowed to remain in the service of the Judiciary, because no other office in the Government exacted a greater demand for mortal
righteousness from an official or employee than a position in the Judiciary.[34]

A finding of dishonesty against an employee in the Civil Service carries with it the penalty of dismissal. Under Rule IV Section 52
(A) (1) of the Revised Uniform Rules on Administrative Cases in the Civil Service Rules (Revised Uniform Rules), dishonesty is
classified as a grave offense that is already punishable by dismissal from the service even at the first offense.

In addition, Section 57 and Section 58 of the Revised Uniform Rules provide as follows:

Section 57. Administrative Disabilities/Accessories to Administrative Penalties.

a. Cancellation of eligibility
b. Forfeiture of retirement benefits.
c. Disqualification for reinstatement or reemployment.
d. Disqualification for promotion.
e. Bar from taking any Civil Service Examination
Section 58. Administrative Disabilities Inherent in Certain Penalties.

a. The penalty of dismissal shall carry with it that of cancellation of eligibility, forfeiture of retirement benefits, and the perpetual
disqualification for reemployment in the government service, unless otherwise provided in the decision.

b. The penalty of transfer shall carry with it disqualification for promotion for a period of six (6) months from the date of
respondent reports to the new position or station.

c. The penalty of demotion shall carry with it disqualification for promotion at the rate of two (2) months for every step or one (1)
month for every range of salary by which he was demoted to be computed from the date respondent reports to the new position or
station.

d. The penalty of suspension shall carry with it disqualification for promotion corresponding to the period of suspension.

e. The penalty of fine shall carry with it disqualification for promotion for a period of twice the number of days he was fined.

f. The penalty of fine shall be paid to the agency imposing the same, computed on the basis of respondent's salary at the time the
decision becomes final and executor.

g. The following are the Guidelines for the payment of fine:

In Civil Service Commission v. Macud,[35] the penalty of dismissal was prescribed with the accessory penalties against respondent
who had been found guilty of making a false declaration in her PDS that she had passed the Professional Board Examination for
Teachers. In Cruz v. Civil Service Commission[36] and Civil Service Commission v. Sta. Ana,[37] the employees found guilty of
similar offenses were dismissed. In Cruz, Zenaida Paitim had masqueraded as Gilda Cruz, and had taken the Civil Service
examination in lieu of Cruz. Both Paitim and Cruz were meted the penalty of dismissal from the service. In Sta. Ana, another
person had taken the Civil Service examination for Sta. Ana, who was held guilty of dishonesty and dismissed from the service.

We do not deviate from such precedents. Catena's dismissal from the service is the appropriate penalty, with her eligibility to be
cancelled, her retirement benefits to be forfeited, and her disqualification from re-employment in the government service to be
perpetual. Nonetheless, we do not forfeit her accrued leave credits to accord with the ruling in Sta. Ana.[38]

Catena's intervening resignation necessarily means that the penalty of dismissal could no longer be implemented against her.
Instead, fine is imposed, the determination of the amount of which is subject to the sound discretion of the Court. [39] As earlier
clarified, the resignation did not prevent this resolution from being made, because resignation should not be used as a convenient
means or strategy to evade administrative liability.[40]

Section 56 (e) of Rule IV of the Revised Uniform Rules provides that the penalty of fine shall be in an amount not exceeding the
salary for six months had respondent not resigned, the rate for which is that obtaining upon at the time of her resignation.

Finally, even though her penalty is a fine, she should still suffer the accessory penalty of perpetual disqualification from re-
employment in the Government that the penalty of dismissal carried. A contrary holding would have the undesirable effect of
giving the erring employee the means to avoid the accessory penalty by the simple expedient of resigning.

Let it be stressed that all court employees of the Judiciary, being public servants in an office dispensing justice, must always act
with a high degree of professionalism and responsibility. Their conduct must not only be characterized by propriety and decorum,
but must also be in accordance with the law and court regulations. They should be models of uprightness, fairness and honesty, for
that is the only way to maintain the people's respect for and faith in the Judiciary. They should avoid any act or conduct that would
diminish public trust and confidence in the courts.[41]

WHEREFORE, the Court FINDS and DECLARES NONITA V. CATENA, former Court Stenographer III, Branch 50, Regional Trial
Court in Puerto Princesa City, Palawan, GUILTY of GROSS DISHONESTY; and ORDERS her to pay a FINE equivalent to her salary
for six months computed at the salary rate for her former position at the time of her resignation, with prejudice to her re-
employment in any branch of the Government, including government-owned or -controlled corporations.

In the event that her leave credits are insufficient to answer for the fine, NONITA V. CATENA shall pay the fine to the Court within
10 days from the date of finality of this decision.

SO ORDERED.

Sereno, C.J. Carpio, Velasco, Jr., Leonardo-De Castro, Peralta, Del Castillo, Abad, Villarama, Jr., Mendoza, Reyes, Perlas-
Bernabe, and Leonen, JJ., concur.
Brion, J., on leave.
Perez, J., no part. acted on matter as Court Adm.

Republic of the Philippines

 Supreme Court
Manila
EN BANC

TERESITA T. BAYONLA, A.C. No. 4808

Complainant,
Present:
CORONA, C.J.,
CARPIO,
VELASCO, JR.,
LEONARDO-DE CASTRO,
BRION,
PERALTA,
-versus- BERSAMIN,
DEL CASTILLO,
ABAD,
VILLARAMA, JR.,
PEREZ,
MENDOZA,
SERENO,
REYES, and
PERLAS-BERNABE, JJ.:
ATTY. PURITA A. REYES,
Respondent. Promulgated:

November 22, 2011

x-----------------------------------------------------------------------------------------x
DECISION
BERSAMIN, J.:

Rule 16.03 - A lawyer shall deliver the funds and property of his client when due or upon demand. However, he shall have a lien
over the funds and may apply so much thereof as may be necessary to satisfy his lawful fees and disbursements, giving notice promptly
thereafter to his client. He shall also have a lien to the same extent on all judgments and executions he has secured for his client as
provided for in the Rules of Court.
- Code of Professional Responsibility.

This canon of professional responsibility is at the center of this administrative complaint for disbarment for gross dishonesty, deceit, conversion, and
breach of trust filed against Atty. Purita A. Reyes by Teresita T. Bayonla, her client. [1]

Antecedents

Petra Durban and Paz Durban were sisters who had jointly owned a parcel of land situated in Butuan City in their lifetimes. They died without
leaving a will. Their land was thereafter expropriated in connection with the construction of the Bancasi Airport. An expropriation compensation amounting
to P2,453,429.00 was to be paid to their heirs. Bayonla and her uncle, Alfredo Tabada (Alfredo), were the compulsory heirs of Paz, being, respectively, Pazs
granddaughter and son.[2]

On June 22, 1997, Bayonla charged Atty. Reyes with gross dishonesty, deceit, conversion, and breach of trust. Bayonla alleged that on October 21,
1993, she and Alfredo had engaged the legal services of Atty. Reyes to collect their share in the expropriation compensation from the Air Transportation Office
(ATO), Cagayan De Oro City,[3] agreeing to her attorneys fees of 10% of whatever amount would be collected; that in November 1993, Atty. Reyes had
collected P1 million from the ATO; that Bayonlas share, after deducting Atty. Reyes attorneys fees, would be P75,000.00, but Atty. Reyes had delivered to her
only P23,000.00, and had failed to deliver the balance of P52,000.00 despite repeated demands; that on June 5, 1995, Atty. Reyes had collected the amount
of P121,119.11 from the ATO; that Bayonlas share, after deducting Atty. Reyes attorneys fees, would be P109,007.20, but Atty. Reyes had handed her
only P56,500.00, and had failed to deliver the balance of P52,507.20; and that Atty. Reyes should be disbarred for depriving her of her just share. [4]

In her comment dated February 10, 1998,[5] Atty. Reyes admitted that Bayonla and Alfredo had engaged her legal services for the purpose of collecting
their share in the expropriation compensation; that as consideration for her services, Bayonla and Alfredo had agreed upon a 40% contingent fee for her; that
she had given to Bayonla more than what had been due to her; that Alfredo had received from the ATO the check for the second release corresponding to the
share of both Bayonla and Alfredo; that Alfredo had gotten more than Bayonla out of the second release; that on June 5, 1995 she had received out of the second
release by the ATO only her 40% contingent fee; that Bayonla and Alfredo had agreed to bear the expenses for the collection of their share; that she had
incurred travel and other expenses in collecting such share; and that she should be absolved from liability arising from the complaint.

On June 29, 1998, the Court referred the complaint to the Integrated Bar of the Philippines (IBP) for investigation, report, and recommendation. [6]

On April 20, 1999, IBP Commissioner Lydia A. Navarro (Commissioner Navarro) rendered a report,[7] whereby she found and recommended against
Atty. Reyes as follows:

In so far as this case of disbarment is concerned, the issue hinges only on the complainants position; one of the heirs of Paz Durban
whose legal services of the respondent was not revoked.

The parties were required to submit documents relative to their respective defenses (sic) specially the actual amounts released by
ATO, actual amount due to the complainant as her share, the remittances made by the respondent to the complainant of her share and
receipts to prove the same.

Unfortunately, only the respondent filed an answer without the necessary documents required of them and attached only a xerox
copy of the computation made by Atty. Ismael Laya for the heir of Pedro Durban which had already been previously attached to the
records of this case.

In the said computation it appears that for the release on February 17, 1993, the heirs of Durban received P84,852.00 and for the
second release each of them as well as the complainant was entitled P121,119.11. It could be inferred from here that complainant was
supposed to received (sic) P205,971.11 as her share.

Inasmuch as the attorneys fees of 40% was (sic) supported by evidence instead of (sic) complainants allegation of ten [10%] percent;
then respondent was entitled to P82,388.45 as attorneys fees; leaving a balance of P123,582.66 due to the complainant.

Respondents allegation that she gave more than what was alleged by the complainant is untenable for she did not submit evidence
to prove the same, therefore, as it is complainants allegation that she received only P79,000.00 for her share as a whole shall be considered
for the moment until such time that proofs to the contrary shall have been submitted.

Considering that complainant was supposed to receive the amount due her which was P123,582.66 and actually received
only P79,000.00; then respondent still has to remit to complainant the amount of P44,582.66.

From the records of this case respondent alleged that she only collected the 40% attorneys fees for the second release whereby
Alfredo Tabada the other heir of Paz Durban received the check from ATO and got a large part of the same. Respondent did not mention
how much she got as attorneys fees against complainants share but on the whole amounting to P496,895.00 which is unfair to the
complainant.
 As counsel for the heirs of Paz Durban, complainant herein should have been advised by the respondent and given a breakdown
of whatever amount was received or came to her knowledge as complainants counsel. Short of the foregoing, respondent violated Rule
16.01 Canon 16 Chapter III of the Code of Professional Responsibility; to wit:

Rule 16.01 A lawyer shall account for all money or property collected or received for or from the client.

Respondent was given a chance to rectify whatever errors or misgivings (sic) she had done for her client but she unfortunately
failed to do so and did not comply with the Order dated October 29, 1998.

Wherefore, in view of the foregoing, the Undersigned respectfully recommends that the respondent be required to render an
accounting or inventory duly confirmed by the complainant of all the collected shares due the complainant and remit to the latter the said
amount of P44.582.66;

Until such time that respondent had complied with the aforementioned, she is suspended from the practice of her legal profession.

Respectfully submitted.

On June 19, 1999, the IBP Board of Governors adopted and approved the report of Commissioner Navarro through Resolution No. XIII-99-165.[8]

Atty. Reyes moved for reconsideration, but on September 27, 1999 the IBP Board of Governors denied her motion for reconsideration through
Resolution No. XIV-99-117.[9]

Atty. Reyes then filed a motion for reinvestigation. However, through its Resolution No. XV-2001-111 adopted on July 28, 2001, the IBP Board of
Governors denied the motion for reinvestigation for lack of jurisdiction, stating that the matter had already been endorsed to the Court. [10]

On July 30, 2002, the Court directed the IBP Board of Governors to report on whether Atty. Reyes had already accounted for and remitted the
amount of P44,582.66 to Bayonla.[11]

On August 22, 2002, the IBP Board of Governors informed the Court that per the manifestation of Bayonlas counsel Atty. Reyes had not yet rendered
an accounting and had not yet remitted the amount of P44,582.66 to Bayonla.[12]

Through her manifestation dated September 4, 2002 to the Court, [13] Atty. Reyes posed some queries, as follows: (a) whether she could be compelled
to pay the amount of P44,582.66 to Bayonla even if the latters claims had been based on perjured statements; (b) whether the payment of the amount would
operate to dismiss the estafa case previously filed by Bayonla against her for allegedly failing to deliver the balance of Bayonlas share; and (c) whether she could
deposit the amount of P44,582.66 with either the IBP Board of Governors or the Court.

Atty. Reyes also stated in the manifestation that the IBP Board of Governors did not accord to her the right to confront Bayonla during the
investigation conducted by the IBP Board of Governors; that Bayonlas counsel had induced Bayonla to file the estafa charge against her; and that this had
prompted her to initiate a disbarment complaint against Bayonlas counsel. [14]

On May 24, 2010, the Office of the Bar Confidant (OBC) recommended the final resolution of this case. [15] The recommendation was noted by the
Court on June 29, 2010.[16]

Issue: Whether or not the findings and recommendations of the IBP Board of Governors were proper.

Ruling: We affirm the findings of the IBP Board of Governors, which were supported by the records, but we modify the sanctions to be imposed on Atty.
Reyes.
I
Respondent was guilty of violating the canons
of the Code of Professional Responsibility

Canon 16 of the Code of Professional Responsibility requires that a lawyer shall hold in trust all moneys and properties of her client that may come
into her possession. Rule 16.01 of Canon 16 imposes on the lawyer the duty to account for all money or property collected or received for or from the client.
Rule 16.03 of Canon 16 demands that the lawyer shall deliver the funds and property of his client when due or upon demand, subject to the lawyers lien over
the funds, or the lawyers option to apply so much of the funds as may be necessary to satisfy the lawful fees and disbursements, giving notice promptly thereafter
to the client.

The canons are appropriate considering that the relationship between a lawyer and her client is highly fiduciary, and prescribes on a lawyer a great
degree of fidelity and good faith. There is no question that the money or property received by a lawyer for her client properly belongs to the
latter.[17] Conformably with these canons of professional responsibility, we have held that a lawyer is obliged to render an accounting of all the property and
money she has collected for her client. This obligation includes the prompt reporting and accounting of the money collected by the lawyer by reason of a
favorable judgment to his client.[18]

Based on the records, Bayonla and her uncle would each receive the amount of P84,852.00 out of the first release, and the amount of P121,119.11 out
of the second release. Her total share from the two releases was P205,971.11. With Atty. Reyes being entitled to P82,388.44 as attorneys fees, the equivalent of
40% of Bayonlas share, the net share of Bayonla was P123,582.67. Yet, Atty. Reyes actually delivered to her only P79,000.00,[19] which was short
by P44,582.67. Despite demands by Bayonla and despite the orders from the IBP Board of Governors for her to remit the shortage, [20] Atty. Reyes refused to do
so.

By not delivering Bayonlas share despite her demand, Atty. Reyes violated the aforestated canons. The money collected by Atty. Reyes as the lawyer
of Bayonla was unquestionably money held in trust to be immediately turned over to the client. [21] The unjustified withholding of money belonging to the client
warrants the imposition of disciplinary sanctions on the lawyer. [22] Without doubt, Atty. Reyes failure to immediately account for and to deliver the money upon
demand was deceit, for it signified that she had converted the money to her own use, in violation of the trust Bayonla had reposed in her. It constituted gross
misconduct for which the penalty of suspension from the practice of law became justified pursuant to Section 27, Rule 138 of the Rules of Court, to wit:

Section 27. Disbarment or suspension of attorneys by Supreme Court, grounds therefor. A member of the bar may be disbarred
or suspended from his office as attorney by the Supreme Court for any deceit, malpractice, or other gross misconduct in such office, grossly
immoral conduct, or by reason of his conviction of a crime involving moral turpitude, or for any violation of the oath which he is required
to take before admission to practice, or for a wilful disobedience appearing as an attorney for a party to a case without authority so to do.
The practice of soliciting cases at law for the purpose of gain, either personally or through paid agents or brokers, constitutes malpractice.

The disbarment or suspension of a member of the Philippine Bar by a competent court or other disciplinary agency in a foreign
jurisdiction where he has also been admitted as an attorney is a ground for his disbarment or suspension if the basis of such action includes
any of the acts hereinabove enumerated.

The judgment, resolution or order of the foreign court or disciplinary agency shall be prima facie evidence of the ground for
disbarment or suspension. (As amended by SC Resolution dated February 13, 1992.)
 II
Pendency of other cases not an obstacle
to administrative proceeding against respondent

The filing of the perjury charge by Atty. Reyes against Bayonla and of the estafa charge by Bayonla against Atty. Reyes could not halt or excuse the
duty of Atty. Reyes to render an accounting and to remit the amount due to Bayonla. Nor did the pendency of such cases inhibit this administrative matter from
proceeding on its due course. It is indisputable that the pendency of any criminal charges between the lawyer and her client does not negate the administrative
proceedings against the lawyer. We explained why in Suzuki v. Tiamson,[23] to wit:

The settled rule is that criminal and civil cases are different from administrative matters, such that the disposition in the first two
will not inevitably govern the third and vice versa. In this light, we refer to this Courts ruling in Berbano vs. Barcelona, citing In re Almacen,
where it was held:
Disciplinary proceedings against lawyers are sui generis. Neither purely civil nor purely criminal, they do not involve a
trial of an action or a suit, but rather investigations by the Court into the conduct of one of its officers. Not being intended to
inflict punishment, [they are] in no sense a criminal prosecution. Accordingly, there is neither a plaintiff nor a prosecutor
therein. [They] may be initiated by the Court motu proprio. Public interest is [their] primary objective, and the real question
for determination is whether or not the attorney is still a fit person to be allowed the privileges as such. Hence, in the exercise
of its disciplinary powers, the Court merely calls upon a member of the Bar to account for his actuations as an officer of the
Court with the end in view of preserving the purity of the legal profession and the proper and honest administration of justice
by purging the profession of members who by their misconduct have prove[n] themselves no longer worthy to be entrusted
with the duties and responsibilities pertaining to the office of an attorney.

Hence, our only concern in the instant case is the determination of respondents administrative liability and our findings herein
should not in any way be treated as having any material bearing on any other judicial action which the parties may choose to file against
each other. [emphasis supplied]

Relevantly, we have also emphasized in Gatchalian Promotions Talents Pool, Inc. v. Naldoza [24] that

xxx a finding of guilt in the criminal case will not necessarily result in a finding of liability in the administrative case. Conversely,
respondents acquittal does not necessarily exculpate him administratively. In the same vein, the trial courts finding of civil liability against
the respondent will not inexorably lead to a similar finding in the administrative action before this Court. Neither will a favorable
disposition in the civil action absolve the administrative liability of the lawyer.

It serves well to mention, lastly, that the simultaneous pendency of an administrative case and a judicial proceeding related to the cause of the
administrative case, even if the charges and the evidence to be adduced in such cases are similar, does not result into or occasion any unfairness, or prejudice,
or deprivation of due process to the parties in either of the cases. [25]
III
No denial of due process to respondent

Atty. Reyes contends that she was denied her right to due process because the IBP Board of Governors did not permit her to personally confront the
complainant.

We do not consider Atty. Reyess contention valid. She was accorded full due process, for she in fact participated in all stages of the proceedings.

It is true that a lawyer shall not be disbarred or suspended from the practice of law until she has had full opportunity upon reasonable notice to
answer the charges against her, to produce witnesses in her behalf, and to be heard by herself or counsel.[26] Contrary to Atty. Reyes insistence, however, the
IBP Board of Governors was under no legal obligation to conduct a trial-type proceeding at which she could have personally confronted Bayonla. In other
words, the lack of such proceeding neither diminished her right to due process nor deprived her of the right. A formal investigation entailing notice and hearing
is required in administrative proceedings for disbarment, but the imperative need of notice and hearing does not always mean the holding of an adversarial
trial-type proceeding. Due process is still satisfied when the parties are afforded the reasonable opportunity to be heard and to submit evidence in support of
their respective sides.[27] As the Court said in Samalio v. Court of Appeals:[28]

Due process in an administrative context does not require trial-type proceedings similar to those in courts of justice. Where
opportunity to be heard either through oral arguments or through pleadings is accorded, there is no denial of procedural due process. A
formal or trial-type hearing is not at all times and in all instances essential. The requirements are satisfied where the parties are afforded
fair and reasonable opportunity to explain their side of the controversy at hand. The standard of due process that must be met in
administrative tribunals allows a certain degree of latitude as long as fairness is not ignored. In other words, it is not legally objectionable
for being violative of due process for an administrative agency to resolve a case based solely on position papers, affidavits or documentary
evidence submitted by the parties as affidavits of witnesses may take the place of their direct testimony.
In this case, petitioner was heard through the various pleadings which he filed with the Board of Discipline of the BID when he
filed his answer and two motions to dismiss, as well as other motions and papers. He was also able to participate in all stages of the
administrative proceeding. He was able to elevate his case to the Secretary of Justice and, subsequently, to the CSC by way of appeal.
We have consistently held that the essence of due process is simply the opportunity to be heard or, as applied to administrative
proceedings, the opportunity to explain ones side or the opportunity to seek a reconsideration of the action or ruling complained of. And
any seeming defect in its observance is cured by the filing of a motion for reconsideration. Denial of due process cannot be successfully
invoked by a party who has had the opportunity to be heard on his motion for reconsideration. [bold emphasis supplied]

Nevertheless, the IBP Board of Governors actually conducted a formal investigation of the complaint against Atty. Reyes upon the directive of the
Court. In her formal investigation of the complaint, Commissioner Navarro allowed both parties to submit their respective proofs on the actual amounts released
by the ATO, the amounts due to Bayonla as her share, Atty. Reyes corresponding contingent fees, the remittances by Atty. Reyes to Bayonla, and the receipts
showing such remittances.[29] In due course, Atty. Reyes submitted her written answer, attaching to the answer the documents supporting her
defenses.[30] Commissioner Navarro took all of Atty. Reyes submissions into good and proper account, as borne out by her report. [31] And even after the IBP
Board of Governors had adopted Commissioner Navarros report (and its recommendation), Atty. Reyes was still afforded the fair opportunity to challenge the
adverse findings by filing her motion for reconsideration, although such motion was ultimately resolved against her. [32]

IV
Sanction

The penalty for gross misconduct consisting in the failure or refusal despite demand of a lawyer to account for and to return money or property
belonging to a client has been suspension from the practice of law for two years. In Almendarez, Jr. v. Langit,[33] the lawyer who withdrew the rentals pertaining
to his client totaling P255,000.00 without the knowledge of the client and who ignored the demand of the client to account for and to return the amount was
suspended from the practice of law for two years. In Mortera v. Pagatpatan,[34] the lawyer received P155,000.00 from the adversary of his clients as partial
payment of a final and executory decision in favor of the clients pursuant to a secret arrangement between the lawyer and the adversary, and deposited the
amount to the lawyers personal bank account without the knowledge of the clients; the lawyer thereafter refused to surrender the money to his clients. The
suspension of the lawyer for two years from the practice of law was ordered by the Court. In Small v. Banares,[35] a similar penalty of suspension for a period of
two years from the practice of law was imposed on a lawyer who had failed to file a case for the purpose of which he had received an amount of P80,000.00, and
to return the amount upon demand. In Barcenas v. Alvero,[36] the Court suspended for a period of two years from the practice of law a lawyer who had failed to
immediately account for and to return P300,000.00 received from a client for the purpose of depositing it in court, after the lawyer had been found not to have
deposited the money in court.

Considering that the sin of Atty. Reyes had striking resemblance with the sins thus sanctioned in the aforementioned precedents, the proper penalty
for her is suspension from the practice of law for two years, with warning that a similar offense by her will be dealt with more severely.
 Atty. Reyes is further obliged to pay to Bayonla the amount of P44,582.67, which the IBP Board of Governors found to be still unpaid, by way of
restitution. Although the Court renders this decision in an administrative proceeding primarily to exact the ethical responsibility on a member of the Philippine
Bar, the Courts silence about the respondent lawyers legal obligation to restitute the complainant will be both unfair and inequitable. No victim of gross ethical
misconduct concerning the clients funds or property should be required to still litigate in another proceeding what the administrative proceeding has already
established as the respondents liability. That has been the reason why the Court has required restitution of the amount involved as a concomitant relief in the
cited cases of Mortera v. Pagatpatan, supra, Almendarez, Jr. v. Langit, supra, and Small v. Banares, supra.

In addition, Atty. Reyes is liable for interest of 12% per annum reckoned from June 22, 1997, the date when she was formally charged with
disbarment. This rate of interest was prescribed by the Court in Almendarez, Jr. v. Langit and Small v. Banares.

WHEREFORE, the Court FINDS AND PRONOUNCES ATTY. PURITA A. REYES guilty of violating Rule 16.01 and Rule 16.03 of Canon 16 of
the Code of Professional Responsibility, and SUSPENDS her from the practice of law for a period of two years effective upon receipt of this Decision, with
warning that a similar offense by her will be dealt with more severely.

The Court ORDERS Atty. Reyes to pay to complainant Teresita T. Bayonla within 30 days from receipt of this Decision the amount of P44,582.67,
with interest of 12% per annum from June 22, 1997, and to render unto the complainant a complete written accounting and inventory of: - (a) the amounts she
had collected from the Air Transportation Office as expropriation compensation; (b) the total amount due to the complainant; (c) the total amount she had
actually remitted to the complainant; and (d) the amount she had deducted as her contingent fee vis--vis the complainant.

Within the same period of compliance, Atty. Reyes shall submit to the Court, through the Office of the Bar Confidant, authentic written proof that
her accounting, inventory, and payment were furnished to and received by the complainant in due course.

This Decision is without prejudice to any pending or contemplated proceedings against Atty. Reyes.

Let this Decision be disseminated to all lower courts and to the Integrated Bar of the Philippines, with a copy of it to be included in Atty. Reyes file
in the Office of the Bar Confidant.

SO ORDERED.

LUCAS P. BERSAMIN
Associate Justice
GSIS VS CANCINO-ERUM (A.M. NO. RTJ-09-2182 SEPTEMBER 5, 2012)

GSIS vs Cancino-Erum
A.M. No. RTJ-09-2182 September 5, 2012

Facts: This administrative complaint emanated from the filing on July 18, 2008 by one Belinda Martizano (Martizano) of a suit
to restrain the Department of Transportation and Communications (DOTC), Land Transportation Office (LTO), Stradcom
Corporation (STRADCOM), Insurance Commission, and Government Service Insurance System (GSIS) from implementing
DOTC Department Order No. 2007-28 (DO 2007-28), an issuance that constituted the LTO the sole insurance provider of
compulsory third party liability (CTPL) that was required for the registration of motor vehicles. The suit, docketed as Civil
Case No. MC08-3660 of the Regional Trial Court (RTC) in Mandaluyong City, claimed that the implementation of DO 2007-28
would deprive Martizano of her livelihood as an insurance agent.3 She applied for the issuance of a temporary restraining order
(TRO). On July 21, 2008, Civil Case No. MC08-3660 was raffled and assigned to Branch 213 of the RTC, presided by respondent
Judge Carlos A. Valenzuela. On October 2, 2008, GSIS charged respondent RTC Judge Maria A. CancinoErum, the then
Executive Judge of the RTC in Mandaluyong City, with grave misconduct, gross ignorance of the law, and violation of the Rules
of Court. On the same date, GSIS also charged Judge Valenzuela with grave misconduct, gross ignorance of the law, violation
of the Rules of Court, and knowingly rendering an unjust order.6 The charges against the respondents were both based on the
non-raffling of Civil Case No.MC08-3660. Allegedly, Judge Erum violated Section 2, Rule 20 of the Rules of Court by assigning
Civil Case No. MC08-3660 to Branch 213 without the benefit of a raffle.

Issues: Whether or not the filing of an administrative complaint is the proper remedy against erring judges.

Whether or not respondent Judge violated the rule on raffling of cases.

Held: No. Administrative case is improper for Judges – We have always regarded as a fundamental precept that an
administrative complaint against a judge is inappropriate as a remedy for the correction of an act or omission complained of
where the remedy of appeal or certiorari is a recourse available to an aggrieved party. Two reasons underlie this fundamental
precept, namely: (a) to hold otherwise is to render judicial office untenable, for no one called upon to try the facts or to interpret
the law in the process of administering justice can be infallible in his judgment; and (b) to follow a different rule can mean a
deluge of complaints, legitimate or otherwise, and our judges will then be immersed in and be ceaselessly occupied with
answering charges brought against them instead of performing their judicial functions.

No. The 1997 Rules of Civil Procedure has expressly made the raffle the exclusive method of assigning cases among several
branches of a court in a judicial station by providing in Section 2 of Rule 20, as follows:

Section 2. Assignment of Cases. – The assignment of cases to the different branches of a court shall be done exclusively by raffle.
The assignment shall be done in open session of which adequate notice shall be given so as to afford interested parties the
opportunity to be present.

The avowed purpose of instituting raffle as the exclusive method of assigning cases among several branches of a court in the
same station is two-fold: one, to equalize the distribution of the cases among the several branches, and thereby foster the Court’s
policy of promoting speedy and efficient disposition of cases; and, two, to ensure the impartial adjudication of cases and thereby
obviate any suspicion regarding assignment of cases to predetermined judges.

Circular No. 7, supra, stated that only the maximum number of cases, according to their dates of filing, as could be equally
distributed to all the branches in the particular station or grouping should be included in the raffle; and that cases in excess of
the number sufficient for equal distribution should be included in the next scheduled raffle.

Despite not strictly following the procedure under Circular No. 7 in assigning Civil Case No. MC08-3660 to Branch 213, the
respondents as members of the Raffle Committee could not be held to have violated the rule on the exclusivity of raffle because
there were obviously less TRO or injunction cases available at anytime for raffling than the number of Branches of the RTC.
Given the urgent nature of TRO or injunction cases, each of them had to be immediately attended to. This peculiarity must have
led to the adoption of the practice of raffling such cases despite their number being less than the number of the Branches in
Mandaluyong City. The practice did not absolutely contravene Circular No. 7 in view of the circular itself expressly excepting
under its fourth paragraph, supra, any incidental or interlocutory matter of such urgent nature (like a TRO application) that
might not wait for the regular raffle.

The urgent nature of an injunction or TRO case demands prompt action and immediate attention, thereby compelling the
filing of the case in the proper court without delay.
Seares Jr. vs. Atty: Gonzales – Alzate
A.C no. 9058
Nov. 14, 2012
FACTS:
Seares, Jr. alleges that Atty. Gonzales-Aizate was his legal counsel when he ran for the position of Municipal Mayor of Dolores,
Abra in the May 2007 elections; that after he lost by a 50-vote margin to Albert Z. Guzman, she filed in his behalf a "Petition Of
Protest Ad Cautelam" in the Regional Trial Court (RTC) in Bangued, Abra; that the petition was dismissed for being "fatally
defective;" that several months later, she insisted on filing a “Petition of Protest” in the RTC, but the petition was also dismissed
on the ground that it was already time-barred, and on the further ground of forum shopping because the certification against
forum shopping was false; that the RTC declared her as “professionally negligent; “that he again ran for Municipal Mayor of
Dolores, Abra in the May 2010 elections, and won; that he later learned that his political opponents retained her as their counsel;
that with him barely two months in office, one Carlito Turqueza charged him with abuse of authority, oppression and grave
misconduct in the Sangguniang Panlalawigan of Abra; that she represented Turqueza as counsel; and that she intentionally made
false and hurtful statements in the memorandum she prepared in that administrative case in order to attack him.
Seares, Jr. asserts that Atty. Gonzales-Alzate thereby violated Canon 15, Canon 17 and Canon 18 of the Code of Professional
Responsibility for negligently handling his election protest, for prosecuting him, her former client, and for uttering false and
hurtful allegations against him. Hence, he prays that she should be disbarred.
In her comment, Atty. Gonzales-Alzate denies all the charges against her which are professional negligence and incompetence,
and of representing conflicting interests.
ISSUE:
Whether or not Atty. Gonzales-Alzate was guilty of professional negligence and incompetence in her handling of Seares, Jr.’s
electoral protest in the RTC?
Whether or not Atty. Gonzales-Alzate violate the prohibition against representing conflicting interests when she assisted
Turqueza in his administrative case against Seares, Jr., her former client?
HELD:
1st Issue:
The complaint against Atty. Gonzales-Alzate is unfounded and devoid of substance.
For administrative liability under Canon to attach, the negligent act of the attorney should be gross and inexcusable as to lead to
a result that was highly prejudicial to the client’s interest. Accordingly, the Court has imposed administrative sanctions on a
grossly negligent attorney for unreasonable failure to file a required pleading, or for unreasonable failure to file an appeal,
especially when the failure occurred after the attorney moved for several extensions to file the pleading and offered several
excuses for his nonfeasance. The Court has found the attendance of inexcusable negligence when an attorney resorts to a wrong
remedy, or belatedly files an appeal, or inordinately delays the filing of a complaint, or fails to attend scheduled court hearings.
Gross misconduct on the part of an attorney is determined from the circumstances of the case, the nature of the act done and the
motive that induced the attorney to commit the act.
The RTC cogently held that “(t)he primary objective of this petition is to pray for the issuance of a Preliminary Precaution Order
xxx (but) a prayer for the issuance of the protection of ballot boxes, Books and Lists of Voters and other election paraphernalia in
the recently concluded elections is well within the power of the Commission on Elections. ”We see no trace of professional
negligence or incompetence on the part of Atty. Gonzales-Alzate in her handling of Seares, Jr.’s protest.
2nd issue:
Seares, Jr. next charges Gonzales-Alzate with violating Canon 15 of the Code of Professional Responsibility for supposedly
representing conflicting interests when she took on the administrative complaint that Turqueza brought against Seares, Jr. The
charge of Seares, Jr. is bereft of merit. Canon 15 of the Code of Professional Responsibility prohibits an attorney from
representing a party in a controversy that is either directly or indirectly related to the subject matter of a previous litigation
involving another client.
Relevantly, Rule 15.01, Rule15.02 and Rule15.03 provide:
Rule 15.01—A lawyer, in conferring with a prospective client, shall ascertain as soon as practicable whether the matter would
involve a conflict with another client or his own interest, and if so, shall forthwith inform the prospective client.
Rule 15.02—A lawyer shall be bound by the rule on privilege communication in respect of matters disclosed to him by a
prospective client.
Rule 15.03—A lawyer shall not represent conflicting interests except by written consent of all concerned given after a full
disclosure of the facts.
Atty. Gonzales-Alzate’s legal representation of Turqueza neither resulted in her betrayal of the fidelity and loyalty she owed to
Seares, Jr. as his former attorney, nor invited the suspicion of unfaithfulness or double dealing while she was performing her
duties as an attorney. Representing conflicting interests would occur only where the attorney’s new engagement would require
her to use against a former client any confidential information gained from the previous professional relation. The prohibition did
not cover a situation where the subject matter of the present engagement was totally unrelated to the previous engagement of
the attorney. To constitute the violation, the attorney should be shown to intentionally use against the former client the
confidential information acquired by her during the previous employment. But a mere allegation of professional misconduct
would not suffice to establish the charge, because accusation was not synonymous with guilt.
As it turned out, the charge of representing conflicting interests leveled against Atty. Gonzales-Alzate was imaginary. The charge
was immediately unworthy of serious consideration because it was clear from the start that Atty. Gonzales-Alzate did not take
advantage of her previous engagement by Seares, Jr. in her legal representation of Turqueza in the latter’s administrative charge
against Seares, Jr. There was no indication whatsoever of her having gained any confidential information during her previous
engagement by Seares, Jr. that could be used against Seares, Jr. Her engagement by Seares, Jr. related only to the election protest
in 2007, but Turqueza’s complaint involved Seares, Jr.’s supposedly unlawful interference in ousting Turqueza as the president of
the Liga ng mga Barangay of Dolores, Abra in 2010. There is no question that both charges were entirely foreign to one another.
A.M. No. P-09-2676 December 16, 2009

JUDGE JUANITA T. GUERRERO, Complainant,

vs.
TERESITA V. ONG, Respondent.

DECISION

BERSAMIN, J.:

Litigant Reynaldo N. Garcia, a plaintiff in Civil Case No. 03-045, entitled Spouses Reynaldo and Lydia Garcia v. Spouses Joselito and Merle Arevalo, brought an
administrative complaint against Judge Juanita T. Guerrero, Presiding Judge of Branch 204 of the Regional Trial Court (RTC) in Muntinlupa City, charging her with bias
and irregularities in relation to her disposition of the application for a writ of preliminary prohibitory and mandatory injunction in said case.

Answering Garcia’s administrative complaint, Judge Guerrero incorporated a formal charge for improper conduct against respondent Teresita V. Ong, Court Stenographer
of Branch 260, RTC, in Parañaque City, which is now the subject matter of this decision.

Antecedents

In his complaint-affidavit against Judge Guerrero,1 Garcia averred that he and his wife, the plaintiffs in Civil Case No. 03-045, had sought the enforcement of an easement
of right of way. He imputed the following acts of impropriety to Judge Guerrero, namely: (1) that she had issued an unjust order in the action; (2) that her process server
had been seen in the premises involved in the litigation looking for Lito Arevalo, the defendant; and (3) that in another case involving him (Garcia) and the Manila Electric
Company (Meralco), she had urged him (Garcia) to settle his obligations by telling him: "Kinakalaban po namin ay pader at wala kaming magagawa."

Required by the Office of the Court Administrator (OCAd) to comment on Garcia’s complaint, 2 Judge Guerrero denied the imputed improprieties, averring that she
resolved the incidents in Civil Case No. 03-045 based on the evidence presented by the parties during the hearings; that no bias or partiality could be noted on the assailed
orders; that her process server had gone to see the defendant in Civil Case No. 03-045 only to serve the court notices; that although she had said that "Meralco was a
pader," she denied saying: "Wala kayong magagawa;" and that she had already recused herself from hearing Garcia's cases.

As stated, Judge Guerrero’s comment incorporated an administrative complaint against Ong. Therein, Judge Guerrero insisted that any acts of impropriety relative to
Civil Case No. 03-045 had been committed by Ong, a tenant of Garcia, who had gone to her chambers on several occasions in the guise of making a courtesy call on her,
and had then discussed the merits of the case with her; that Ong had engaged in name-dropping to urge her to resolve in favor of Garcia; that Ong had attended the hearings
of the case in her Supreme Court uniform; and that Ong had told her Acting Branch Clerk of Court that she (Judge Guerrero) and the defendants "ay nagkatapatan na,"
which Ong had implied to mean that the "Judge (had) received consideration from the defendants."

In its memorandum dated November 22, 2004,3 the OCAd found that Judge Guerrero had committed no act of impropriety, and recommended that the complaint against
Judge Guerrero be dismissed for lack of merit, with a reminder to Judge Guerrero to exercise caution in her utterances, like remarking that Meralco was "pader," lest they
be misconstrued as bias in favor of a party litigant. The OCAd further recommended that Ong be required to comment on the allegations of improper conduct made against
her by Judge Guerrero.

Through the resolution dated January 19, 2005,4 the Court adopted the recommendations of the OCAd; dismissed the complaint against Judge Guerrero; and required Ong
to comment on Judge Guerrero’s allegations of impropriety against her within 10 days from notice.

In due course, Ong submitted her comment on July 18, 2005. 5

The Court referred Ong’s comment to the OCAd for evaluation, report and recommendation. 6

In turn, the OCAd recommended that the administrative matter against Ong be referred for investigation to a consultant of the OCAd in order to ascertain every act of
impropriety imputed against her.

Accordingly, on February 13, 2006,7 the Court referred the administrative matter against Ong to retired Justice Narciso T. Atienza for investigation. Justice Atienza
submitted his report on July 31, 2006.8

On August 12, 2009, the case was re-docketed as a regular administrative case.

Justice Atienza's Report and Recommendation

During the investigation, Ong explained that her attendance at the hearings and ocular inspection had been made only upon the request of Garcia, whose plea for moral
support she could not refuse; that she had not filed applications for leave because her superior had permitted her to attend the hearings and the ocular inspection; and that
her sole purpose for talking with Judge Guerrero had been only to inform the latter about the case pending in her sala.

Justice Atienza regarded Ong's defense as incredible, and observed that Ong's real intention in talking with Judge Guerrero in her chambers while in office uniform had
been to influence Judge Guerrero to resolve the pending incident in Garcia’s favor. He concluded that Ong had attended several hearings and the ocular inspection in
Civil Case No. 03-045 in her office uniform and during office hours; and that on those occasions, she had not filed applications for leave and had not reflected her
undertime in her daily time records (DTRs).

Justice Atienza recommended, therefore, that:

1) Ms. Teresita V. Ong be reprimanded for improper conduct with a warning that commission of the same or similar acts of impropriety in the future shall be dealt with
more severely; and,

2) Advise Ms. Ong to log out before leaving the Office during office hours and log in upon return, but when leaving the office is not on official business, the undertime
should be reflected in the Daily Time Record.9
 Ruling

The Court agrees with the findings of Justice Atienza, which were entirely substantiated by the records, but differs with his recommendation of the penalty. Ong was
guilty of grave misconduct, for using her official position as a court employee to secure benefits for Garcia; and of dishonesty, for committing serious irregularities in the
keeping of her DTRs.

I. Use of Official Position to Secure Benefits

All court personnel, from the lowliest employees to the clerks of court, are involved in the dispensation of justice like judges and justices, and parties seeking redress
from the courts for grievances look upon them also as part of the Judiciary. 10 In performing their duties and responsibilities, court personnel serve as sentinels of justice,
that any act of impropriety they commit immeasurably affects the honor and dignity of the Judiciary and the people's confidence in the Judiciary. 11 They are, therefore,
expected to act and behave in a manner that should uphold the honor and dignity of the Judiciary, if only to maintain the people’s confidence in the Judiciary.

A court employee is not prohibited from helping individuals in the course of performing her official duties, but her actions cannot be left unchecked when the help
extended puts under suspicion the integrity of the Judiciary.12 Indeed, she is strictly instructed not to use her official position to secure unwarranted benefits, privileges,
or exemptions for herself or for others.13 The evident purpose of the instruction is precisely to free the court employees from suspicion of misconduct.

Ong did not comply with the instruction. Instead, she used her official position as an employee of the Judiciary to attempt to influence Judge Guerrero to rule in favor of
litigant Garcia, her landlord. She was thereby guilty of misconduct, defined as a transgression of some established or definite rule of action; or, more particularly, an
unlawful behavior on the part of a public officer or employee. 14 Her misconduct was grave, which the Court explains in Imperial v. Santiago,15 viz:

Misconduct is a transgression of some established and definite rule of action, more particularly, unlawful behavior or gross negligence by the public officer. To warrant
dismissal from the service, the misconduct must be grave, serious, important, weighty, momentous and not trifling. The misconduct must imply wrongful
intention and not a mere error of judgment. The misconduct must also have a direct relation to and be connected with the performance of his official duties amounting
either to maladministration or willful, intentional neglect or failure to discharge the duties of the office. There must also be reliable evidence showing that the judicial acts
complained of were corrupt or inspired by an intention to violate the law.

In grave misconduct, as distinguished from simple misconduct, the elements of corruption, clear intent to violate the law, or flagrant disregard of established rule must be
manifest.16 Corruption as an element of grave misconduct consists in the act of an official or employee who unlawfully or wrongfully uses her station or character to
procure some benefit for herself or for another, contrary to the rights of others.17 It is established herein that Ong knowingly and corruptly tried to influence Judge Guerrero
to favor Garcia in the latter’s pending civil action.

Ong’s grave misconduct was a grave offense that deserved the penalty of dismissal for the first offense pursuant to Sec. 52, A, of the Uniform Rules on Administrative
Cases in the Civil Service.18 However, there being no record of her having previously committed a similar offense, the penalty of suspension of one year without pay and
a fine of P20,000.00, coupled with a warning that a repetition shall be dealt with more severely, is just and proper. The penalty is commensurate with the penalty meted
in Salazar v. Barriga,19 whereby the Court imposed on a sheriff found guilty of grave misconduct the penalty of suspension of one year without pay and a fine of
P20,000.00, upon considering the length of his government service as a mitigating circumstance.

II. Making False Entries in the DTR

Justice Atienza found that Ong had made false entries in her DTRs by indicating therein that she had been at work although she had been elsewhere. We sustain the
finding of Justice Atienza and pronounce Ong administratively liable for committing irregularities in the keeping of her DTRs.20 Her false entries in the DTRs constituted
dishonesty,21 an act that Section 52, Rule IV, Uniform Rules on Administrative Cases in the Civil Service, classifies as a grave offense for which the penalty of dismissal
from the service even for the first commission is imposable.

Again, the Court opts not to wield the axe of outright dismissal, a penalty that may be too extreme. As earlier observed, there is no record of Ong having been previously
charged with and penalized for any administrative offense. Section 53, Rule IV of the Revised Uniform Rules on Administrative Cases in the Civil Service grants the
disciplining authority the discretion to consider mitigating circumstances in the imposition of the proper penalty. 22 The Court thus imposes upon her the penalty of
suspension of one year without pay, with warning that a repetition of the offense will surely be dealt with more severely.

WHEREFORE, we find and declare Court Stenographer Teresita V. Ong separately liable for the two administrative offenses of gross misconduct and dishonesty, and,
accordingly, suspend her for one year without pay for each offense, to be served consecutively, plus a fine of P20,000.00 for the grave misconduct, with a warning that
the repetition of either offense shall be dealt with more severely.

Let a copy of this decision be attached to the personnel records of respondent Ong in the Office of the Administrative Services, Office of the Court Administrator.

SO ORDERED.

LUCAS P. BERSAMIN
 Legal Ethics
PESTO VS. MILLO, ADM. CASE NO. 9612, MAR. 13, 2013 (9612 bungling of client's money)
Facts: Johnny Pesto (Johnny), a Canadian national, charged Atty. Marcelito M. Millo with conduct unbecoming an officer of
the Court, misleading his client, bungling the transfer of title, and incompetence and negligence in the performance of his
duty as a lawyer.
In May 1990, his wife Abella Pesto (Abella) retained the services of Atty. Millo to handle the transfer of title over a
parcel of land to her name, and the adoption of her niece, Arvi Jane Dizon. Johnny and Abella gave to Atty. Millo the amounts
of P14,000.00 for the transfer of title and P10,000.00 for the adoption case. Atty. Millo thereafter repeatedly gave them false
information and numerous excuses to explain his inability to complete the transfer of title and made them believe that the
capital gains tax for the property had been paid way back in 1991, but they found out upon their return to the country in
February 1995 that he had not yet paid the tax. When they confronted him, Atty. Millo insisted that he had already paid the
same, but he could not produce any receipt for the supposed payment. Atty. Millo then further promised in writing to assume
the liability for the accrued penalties.
Exasperated by Atty. Millo’s neglect and ineptitude, Johnny brought this administrative complaint in the Integrated
Bar of the Philippines (IBP). On October 11, 2001, the IBP-CBD, through Commissioner Victoria Gonzalez-De los Reyes, deemed
the case submitted for resolution. On October 4, 2010, Investigating Commissioner Victor C. Fernandez, to whom the case had
been meanwhile transferred, submitted a report and recommendation, whereby he found Atty. Millo liable for violating Canon
18 of the Code of Professional Responsibility, and recommended his suspension from the practice of law for six months.
Ruling: Every attorney owes fidelity to the causes and concerns of his clients. He must be ever mindful of the trust and
confidence reposed in him by the clients. His duty to safeguard the clients’ interests commences from his engagement as
such, and lasts until his effective release by the clients. In that time, he is expected to take every reasonable step and exercise
ordinary care as his clients’ interests may require.
Without doubt, Atty. Millo had the obligation to serve his clients with competence and diligence. Rule 18.03, Canon
18 of the Code of Professional Responsibility, expressly so demanded of him, to wit:
CANON 18 – A LAWYER SHALL SERVE HIS CLIENT WITH COMPETENCE AND DILIGENCE.
Rule 18.03 – A lawyer shall not neglect a legal matter entrusted to him, and his negligence in connection therewith shall
render him liable.
Atty. Millo claimed that his belated response to the charge was due to the assurances of Abella that she would be withdrawing
the complaint. The Court disbelieves him, however, and treats his claim as nothing but a belated attempt to save the day for
himself. He ought to remember that the withdrawal of an administrative charge for suspension or disbarment based on an
attorney’s professional misconduct or negligence will not furnish a ground to dismiss the charge. Suspension or disbarment
proceedings that are warranted will still proceed regardless of the lack or loss of interest on the part of the complainant. The
Court may even entirely ignore the withdrawal of the complaint, and continue to investigate in order to finally determine
whether the charge of professional negligence or misconduct was borne out by the record. This approach bespeaks the
Court’s consistent view that the Legal Profession is not only a lofty and noble calling, but also a rare privilege reserved only
for the deserving.
Atty. Millo made his situation even worse by consistently absenting himself from the scheduled hearings the IBP had
set for his benefit. His disregard of the IBP’s orders requiring his attendance in the hearings was not only irresponsible, but
also constituted utter disrespect for the Judiciary and his fellow lawyers. Such conduct was absolutely unbecoming of a lawyer,
because lawyers are particularly called upon to obey Court orders and processes and are expected to stand foremost in
complying with orders from the duly constituted authorities
The recommended penalty is not well taken. We modify the penalty, because Atty. Millo displayed no remorse as to
his misconduct, and could not be given a soft treatment. His professional misconduct warranted a longer suspension from the
practice of law because he had caused material prejudice to the clients’ interest. He should somehow be taught to be more
ethical and professional in dealing with trusting clients like Johnny and Abella, who were innocently too willing to repose their
utmost trust in his abilities as a lawyer and in his trustworthiness as a legal professional. He should remember that misconduct
has no place in the heart and mind of a lawyer who has taken the solemn oath to delay no man for money or malice, and to
conduct himself as a lawyer according to the best of his knowledge and discretion. Under the circumstances, suspension from
the practice of law for six months is the condign and commensurate penalty for him.