Legal Ethics No.
5 Attorney C lient Relationship Page |1
Adm. Case No. 5280. March 30, 2004.*
WILLIAM S. UY, complainant, vs. ATTY. FERMIN L. GONZALES, respondent.
Legal Ethics; Attorneys; Disbarment; A proceeding for suspension or disbarment is not in any sense a
civil action where the complainant is a plaintiff and the respondent lawyer is a defendant—disciplinary
proceedings involve no private interest and afford no redress for private grievance.—Preliminarily, we
agree with Commissioner Villanueva-Maala that the manifestation of complainant Uy expressing his
desire to dismiss the administrative complaint he filed against respondent, has no persuasive bearing in
the present case. Sec. 5, Rule 139-B of the Rules of Court states that: . . . . No investigation shall be
interrupted or terminated by reason of the desistance, settlement, compromise, restitution, withdrawal
of the charges, or failure of the complainant to prosecute the same. This is because: A proceeding for
suspension or disbarment is not in any sense a civil action where the complainant is a plaintiff and the
respondent lawyer is a defendant. Disciplinary proceedings involve no private interest and afford no
redress for private grievance. They are undertaken and prosecuted solely for the public welfare. They
are undertaken for the purpose of preserving courts of justice from the official ministration of persons
unfit to practice in them. The attorney is called to answer to the court for his conduct as an officer of
the court. The complainant or the person who called the attention of the court to the attorney’s alleged
misconduct is in no sense a party, and has generally no interest in the outcome except as all good
citizens may have in the proper administration of justice. Hence, if the evidence on record warrants, the
respondent may be suspended or disbarred despite the desistance of complainant or his withdrawal of
the charges.
Attorney-Client Relationships; Words and Phrases; Practice of law embraces any activity, in or out of
court, which requires the application of law, as well as legal principles, practice or procedure and calls
for legal knowledge, training and experience.—Practice of law embraces any activity, in or out of court,
which requires the application of law, as well as legal principles, practice or procedure and calls for legal
knowledge, training and experience. While it is true that a lawyer may be disbarred or suspended for
any misconduct, whether in his professional or private capacity, which shows him to be wanting in
moral character, in honesty, probity and good demeanor or unworthy to continue as an officer of the
court, complainant failed to prove any of the circumstances enumerated above that would warrant the
disbarment or suspension of herein respondent.
As a rule, an attorney-client relationship is said to exist when a lawyer voluntarily permits or acquiesces
with the consultation of a person, who in respect to a business or trouble of any kind, consults a lawyer
with a view of obtaining professional advice or assistance; There is no attorney-client relationship
between a lawyer and another person where the preparation and the proposed filing of a petition was
only incidental to their personal transaction.—As a rule, an attorney-client relationship is said to exist
when a lawyer voluntarily permits or acquiesces with the consultation of a person, who in respect to a
business or trouble of any kind, consults a lawyer with a view of obtaining professional advice or
assistance. It is not essential that the client should have employed the attorney on any previous
occasion or that any retainer should have been paid, promised or charged for, neither is it material that
the attorney consulted did not afterward undertake the case about which the consultation was had, for
as long as the advice and assistance of the attorney is sought and received, in matters pertinent to his
profession. Considering the attendant peculiar circumstances, said rule cannot apply to the present
case. Evidently, the facts alleged in the complaint for “Estafa Through Falsification of Public Documents”
filed by respondent against complainant were obtained by respondent due to his personal dealings with
complainant. Respondent volunteered his service to hasten the issuance of the certificate of title of the
land he has redeemed from complainant. Respondent’s immediate objective was to secure the title of
the property that complainant had earlier bought from his son. Clearly, there was no attorney-client
relationship between respondent and complainant. The preparation and the proposed filing of the
petition was only incidental to their personal transaction.
Violation of Confidentiality; There is no violation of the duty of a lawyer to preserve the confidence and
secrets of another where the facts alleged in a complaint for estafa filed by the lawyer against such
person were not obtained by the lawyer in his professional capacity but as a redemptioner of a property
originally owned by his deceased son, and to hold otherwise would be precluding any lawyer from
instituting a case against anyone to protect his personal or proprietary interests.—The alleged “secrets”
of complainant were not specified by him in his affidavit-complaint. Whatever facts alleged by
respondent against complainant were not obtained by respondent in his professional capacity but as a
redemptioner of a property originally owned by his deceased son and therefore, when respondent filed
the complaint for estafa against herein complainant, which necessarily involved alleging facts that
would constitute estafa, respondent was not, in any way, violating Canon 21. There is no way we can
equate the filing of the affidavit-complaint against herein complainant to a misconduct that is wanting
in moral character, in honesty, probity and good demeanor or that renders him unworthy to continue as
an officer of the court. To hold otherwise would be precluding any lawyer from instituting a case
against anyone to protect his personal or proprietary interests.
ADMINISTRATIVE MATTER in the Supreme Court. Violation of Confidentiality of Lawyer-Client
Relationship.
RESOLUTION
AUSTRIA-MARTINEZ, J.:
William S. Uy filed before this Court an administrative case against Atty. Fermin L. Gonzales for violation
of the confidentiality of their lawyer-client relationship. The complainant alleges:
Sometime in April 1999, he engaged the services of respondent lawyer to prepare and file a petition for
the issuance of a new certificate of title. After confiding with respondent the circumstances surrounding
the lost title and discussing the fees and costs, respondent prepared, finalized and submitted to him a
petition to be filed before the Regional Trial Court of Tayug, Pangasinan. When the petition was about
to be filed, respondent went to his (complainant’s) office at Virra Mall, Greenhills and demanded a
certain amount from him other than what they had previously agreed upon. Respondent left his office
after reasoning with him. Expecting that said petition would be filed, he was shocked to find out later
that instead of filing the petition for the issuance of a new certificate of title, respondent filed a letter-
complaint dated July 26, 1999 against him with the Office of the Provincial Prosecutor of Tayug,
Pangasinan for “Falsification of Public Documents.”1 The letter-complaint contained facts and
circumstances pertaining to the transfer certificate of title that was the subject matter of the petition
which respondent was supposed to have filed. Portions of said letter-complaint read:
“The undersigned complainant accuses WILLIAM S. UY, of legal age, Filipino, married and a resident of
132-A Gilmore Street corner 9th Street, New Manila, Quezon City, Michael Angelo T. UY, CRISTINA

EARL T. UY, minors and residents of the aforesaid address, Luviminda G. Tomagos, of legal age,
married, Filipino and a resident of Carmay East, Rosales, Pangasinan, and F. Madayag, with office
address at Al2, 2/F Vira Mall Shopping Complex, Greenhills, San Juan, Metro Manila, for ESTAFA THRU
FALSIFICATION OF PUBLIC DOCUMENTS, committed as follows:
“That on March 15, 1996, William S. Uy acquired by purchase a parcel of land consisting of 4.001 ha.
for the amount of P100,000.00, Philippine Currency, situated at Brgy. Gonzales, Umingan, Pangasinan,
from FERMIN C. GONZALES, as evidenced by a Deed of Sale executed by the latter in favor of the
former . . .; that in the said date, William S. Uy received the Transfer Certificate of Title No. T-33122,
covering the said land;
“That instead of registering said Deed of Sale and Transfer Certificate of Title (TCT) No. T-33122, in the
Register of Deeds for the purpose of transferring the same in his name, William S. Uy executed a Deed
of Voluntary Land Transfer of the aforesaid land in favor of his children, namely, Michael Angelo T. Uy
and Cristina Earl T. Uy, wherein William S. Uy made it appear that his said children are of legal age, and
residents of Brgy. Gonzales, Umingan, Pangasinan, when in fact and in truth, they are minors and
residents of Metro Manila, to qualify them as farmers/beneficiaries, thus placing the said property within
the coverage of the Land Reform Program;
“That the above-named accused, conspiring together and helping one another procured the falsified
documents which they used as supporting papers so that they can secure from the Office of the
Register of Deeds of Tayug, Pangasinan, TCT No. T-5165 (Certificate of Land Ownership Award No. 004
32930) in favor of his above-named children. Some of these Falsified documents are purported Affidavit
of Seller/Transferor and Affidavit of Non-Tenancy, both dated August 20, 1996, without the signature of
affiant, Fermin C. Gonzales, and that on that said date, Fermin C. Gonzales was already dead . . . ;
“That on December 17, 1998, William S. Uy with deceit and evident intent to defraud undersigned, still
accepted the amount of P340,000.00, from Atty. Fermin L. Gonzales, P300,000.00, in PNB Check No.
0000606, and P40,000.00, in cash, as full payment of the redemption of TCT No. 33122 . . . knowing
fully well that at that time the said TCT cannot be redeemed anymore because the same was already
transferred in the name of his children;
“That William S. Uy has appropriated the amount covered by the aforesaid check, as evidenced by the
said check which was encashed by him . . .;
“That inspite of repeated demands, both oral and in writing, William S. Uy refused and continue to
refuse to deliver to him a TCT in the name of the undersigned or to return and repay the said
P340,000.00, to the damage and prejudice of the undersigned.”2
With the execution of the letter-complaint, respondent violated his oath as a lawyer and grossly
disregarded his duty to preserve the secrets of his client. Respondent unceremoniously turned against
him just because he refused to grant respondent’s request for additional compensation. Respondent’s
act tarnished his reputation and social standing.3
In compliance with this Court’s Resolution dated July 31, 2000,4 respondent filed his Comment
narrating his version, as follows:
Legal Ethics No. 5 Attorney C lient Relationship Page |2
On December 17, 1998, he offered to redeem from complainant a 4.9 hectare-property situated in
Brgy. Gonzales, Umingan, Pangasinan covered by TCT No. T-33122 which the latter acquired by
purchase from his (respondent’s) son, the late Fermin C. Gonzales, Jr.. On the same date, he paid
complainant P340,000.00 and demanded the delivery of TCT No. T-33122 as well as the execution of
the Deed of Redemption. Upon request, he gave complainant additional time to locate said title or until
after Christmas to deliver the same and execute the Deed of Redemption. After the said period, he
went to complainant’s office and demanded the delivery of the title and the execution of the Deed of
Redemption. Instead, complainant gave him photocopies of TCT No. T-33122 and TCT No. T-5165.
Complainant explained that he had already transferred the title of the property, covered by TCT No.T-
5165 to his children Michael and Cristina Uy and that TCT No. T-5165 was misplaced and cannot be
located despite efforts to locate it. Wanting to protect his interest over the property coupled with his
desire to get hold of TCT No. T-5165 the earliest possible time, he offered his assistance pro bono to
prepare a petition for lost title provided that all necessary expenses incident thereto including expenses
for transportation and others, estimated at P20,000.00, will be shouldered by complainant. To these,
complainant agreed.
On April 9, 1999, he submitted to complainant a draft of the petition for the lost title ready for signing
and notarization. On April 14, 1999, he went to complainant’s office informing him that the petition is
ready for filing and needs funds for expenses. Complainant who was with a client asked him to wait at
the anteroom where he waited for almost two hours until he found out that complainant had already
left without leaving any instructions nor funds for the filing of the petition. Complainant’s conduct
infuriated him which prompted him to give a handwritten letter telling complainant that he is
withdrawing the petition he prepared and that complainant should get another lawyer to file the
petition.
Respondent maintains that the lawyer-client relationship between him and complainant was terminated
when he gave the handwritten letter to complainant; that there was no longer any professional
relationship between the two of them when he filed the letter-complaint for falsification of public
document; that the facts and allegations contained in the letter-complaint for falsification were culled
from public documents procured from the Office of the Register of Deeds in Tayug, Pangasinan. In a
Resolution dated October 18, 2000, the Court referred the case to the Integrated Bar of the Philippines
(IBP) for investigation, report and recommendation. Commissioner Rebecca Villanueva-Maala ordered
both parties to appear on April 2, 2003 before the IBP.7 On said date, complainant did not appear
despite due notice. There was no showing that respondent received the notice for that day’s hearing
and so the hearing was reset to May 28, 2003. On April 29, 2003, Commissioner Villanueva-Maala
received a letter from one Atty. Augusto M. Macam dated April 24, 2003, stating that his client, William
S. Uy, had lost interest in pursuing the complaint he filed against Atty. Gonzales and requesting that the
case against Atty. Gonzales be dismissed.9
On June 2, 2003, Commissioner Villanueva-Maala submitted her report and recommendation, portions
of which read as follows:
The facts and evidence presented show that when respondent agreed to handle the filing of the
Verified Petition for the loss of TCT No. T-5165, complainant had confided to respondent the fact of the
loss and the circumstances attendant thereto. When respondent filed the Letter-Complaint to the Office
of the Special Prosecutor in Tayug, Pangasinan, he violated Canon 21 of the Code of Professional

Responsibility which expressly provides that “A lawyer shall preserve the confidences and secrets of his
client even after the attorney-client relation is terminated.” Respondent cannot argue that there was no
lawyer-client relationship between them when he filed the Letter-Complaint on 26 July 1999 considering
that as early as 14 April 1999, or three (3) months after, respondent had already terminated
complainant’s perceived lawyer-client relationship between them. The duty to maintain inviolate the
client’s confidences and secrets is not temporary but permanent. It is in effect perpetual for “it outlasts
the lawyer’s employment” (Canon 37, Code of Professional Responsibility) which means even after the
relationship has been terminated, the duty to preserve the client’s confidences and secrets remains
effective. Likewise Rule 21.02, Canon 21 of the Rules of Professional Responsibility provides that “A
lawyer shall not, to the disadvantage of his client, use information acquired in the course of
employment, nor shall he use the same to his own advantage or that of a third person, unless the client
with the full knowledge of the circumstances consents thereto.”
On 29 April 2003, the Commission received a letter dated 24 April 2003 from Atty. Augusto M. Macam,
who claims to represent complainant, William S. Uy, alleging that complainant is no longer interested in
pursuing this case and requested that the same be dismissed. The aforesaid letter hardly deserves
consideration as proceedings of this nature cannot be “interrupted by reason of desistance, settlement,
compromise, restitution, withdrawal of the charges, or failure of the complainant to prosecute the
same. (Section 5, Rule 139-B, Rules of Court). Moreover, in Boliver vs. Simbol, 16 SCRA 623, the Court
ruled that “any person may bring to this Court’s attention the misconduct of any lawyer, and action will
usually be taken regardless of the interest or lack of interest of the complainant, if the facts proven so
warrant.”
IN VIEW OF THE FOREGOING, we find respondent Atty. Fermin L. Gonzales to have violated the Code
of Professional Responsibility and it is hereby recommended that he be SUSPENDED for a period of SIX
(6) MONTHS from receipt hereof, from the practice of his profession as a lawyer and member of the
Bar.10
On June 21, 2003, the Board of Governors of the Integrated Bar of the Philippines issued Resolution
No. XV-2003-365, thus:
RESOLVED to ADOPT and APPROVE, as it is hereby ADOPTED and APPROVED, the Report and
Recommendation of the Investigating Commissioner of the above-entitled case, herein made part of
this Resolution/Decision as Annex “A”; and finding the recommendation fully supported by the evidence
on record and applicable laws and rules, and considering that respondent violated Rule 21.02, Canon 21
of the Canons of Professional Responsibility, Atty. Fermin L. Gonzales is hereby SUSPENDED from the
practice of law for six (6) months. Preliminarily, we agree with Commissioner Villanueva-Maala that the
manifestation of complainant Uy expressing his desire to dismiss the administrative complaint he filed
against respondent, has no persuasive bearing in the present case.
Sec. 5, Rule 139-B of the Rules of Court states that:
No investigation shall be interrupted or terminated by reason of the desistance, settlement,
compromise, restitution, withdrawal of the charges, or failure of the complainant to prosecute the
same.
This is because:
Legal Ethics No. 5 Attorney C lient Relationship Page |3
A proceeding for suspension or disbarment is not in any sense a civil action where the complainant is a
plaintiff and the respondent lawyer is a defendant. Disciplinary proceedings involve no private interest
and afford no redress for private grievance. They are undertaken and prosecuted solely for the public
welfare. They are undertaken for the purpose of preserving courts of justice from the official
ministration of persons unfit to practice in them. The attorney is called to answer to the court for his
conduct as an officer of the court. The complainant or the person who called the attention of the court
to the attorney’s alleged misconduct is in no sense a party, and has generally no interest in the
outcome except as all good citizens may have in the proper administration of justice. Hence, if the
evidence on record warrants, the respondent may be suspended or disbarred despite the desistance of
complainant or his withdrawal of the charges.12
Now to the merits of the complaint against the respondent.
Practice of law embraces any activity, in or out of court, which, requires the application of law, as well
as legal principles, practice or procedure and calls for legal knowledge, training and experience.13
While it is true that a lawyer may be disbarred or suspended for any misconduct, whether in his
professional or private capacity, which shows him to be wanting in moral character, in honesty, probity
and good demeanor or unworthy to continue as an officer of the court,14 complainant failed to prove
any of the circumstances enumerated above that would warrant the disbarment or suspension of herein
respondent.
Notwithstanding respondent’s own perception on the matter, a scrutiny of the records reveals that the
relationship between complainant and respondent stemmed from a personal transaction or dealings
between them rather than the practice of law by respondent. Respondent dealt with complainant only
because he redeemed a property which complainant had earlier purchased from his (complainant’s)
son. It is not refuted that respondent paid complainant P340,000.00 and gave him ample time to
produce its title and execute the Deed of Redemption. However, despite the period given to him,
complainant failed to fulfill his end of the bargain because of the alleged loss of the title which he had
admitted to respondent as having prematurely transferred to his children, thus prompting respondent to
offer his assistance so as to secure the issuance of a new title to the property, in lieu of the lost one,
with complainant assuming the expenses therefor.
As a rule, an attorney-client relationship is said to exist when a lawyer voluntarily permits or acquiesces
with the consultation of a person, who in respect to a business or trouble of any kind, consults a lawyer
with a view of obtaining professional advice or assistance. It is not essential that the client should have
employed the attorney on any previous occasion or that any retainer should have been paid, promised
or charged for, neither is it material that the attorney consulted did not afterward undertake the case
about which the consultation was had, for as long as the advice and assistance of the attorney is
sought and received, in matters pertinent to his profession.15
Considering the attendant peculiar circumstances, said rule cannot apply to the present case. Evidently,
the facts alleged in the complaint for “Estafa Through Falsification of Public Documents” filed by
respondent against complainant were obtained by respondent due to his personal dealings with
complainant. Respondent volunteered his service to hasten the issuance of the certificate of title of the
land he has redeemed from complainant. Respondent’s immediate objective was to secure the title of
the property that complainant had earlier bought from his son. Clearly, there was no attorney-client

relationship between respondent and complainant. The preparation and the proposed filing of the
petition was only incidental to their personal transaction.
Canon 21 of the Code of Professional Responsibility reads:
Canon 21—A LAWYER SHALL PRESERVE THE CONFIDENCE AND SECRETS OF HIS CLIENT EVEN AFTER
THE ATTORNEY-CLIENT RELATION IS TERMINATED.
Rule 21.01—A lawyer shall not reveal the confidences or secrets of his client except:
a) When authorized by the client after acquainting him of the consequences of the disclosure;
b) When required by law;
c) When necessary to collect his fees or to defend himself, his employees or associates or by judicial
action.
The alleged “secrets” of complainant were not specified by him in his affidavit-complaint. Whatever
facts alleged by respondent against complainant were not obtained by respondent in his professional
capacity but as a redemptioner of a property originally owned by his deceased son and therefore, when
respondent filed the complaint for estafa against herein complainant, which necessarily involved
alleging facts that would constitute estafa, respondent was not, in any way, violating Canon 21. There
is no way we can equate the filing of the affidavit-complaint against herein complainant to a misconduct
that is wanting in moral character, in honesty, probity and good demeanor or that renders him
unworthy to continue as an officer of the court. To hold otherwise would be precluding any lawyer from
instituting a case against anyone to protect his personal or proprietary interests.
WHEREFORE, Resolution No. XV-2003-365 dated June 21, 2003 of the Integrated Bar of the Philippines
is REVERSED and SET ASIDE and the administrative case filed against Atty. Fermin L. Gonzales,
docketed as A.C. No. 5280, is DISMISSED for lack of merit. SO ORDERED.
Administrative complaint dismissed
Notes.—If a person, in respect to his business affairs or troubles of any kind, consults with his attorney
in his professional capacity with the view to obtaining professional advice or assistance, and the
attorney voluntarily permits or acquiesces in such consultation, then the professional employment must
be regarded as established. (Junio vs. Grupo, 372 SCRA 525 [2001])
A written contract is not an essential element in the employment of an attorney—the contract may be
express or implied. To establish the attorney-client relation, it is sufficient that the advice and
assistance of an attorney is sought and received in any matter pertinent to his profession. (Rabanal vs.
Tugade, 383 SCRA 484 [2002])
Legal Ethics No. 5 Attorney C lient Relationship Page |4
G.R. No. 104600. July 2, 1999.*
RILLORAZA, AFRICA, DE OCAMPO and AFRICA, petitioners, vs. EASTERN
TELECOMMUNICATIONS PHILS., INC. and PHILIPPINE LONG DISTANCE TELEPHONE
COMPANY, respondents.
Remedial Law; Procedural rules are liberally construed in order to promote their objectives and assist
the parties in obtaining just, speedy and inexpensive determination of every action or proceeding.—
There is nothing sacrosanct about procedural rules, which are liberally construed in order to promote
their objectives and assist the parties in obtaining just, speedy and inexpensive determination of every
action or proceeding. In an analogous case, we ruled that where the rigid application of the rules would
frustrate substantial justice, or bar the vindication of a legitimate grievance, the courts are justified in
exempting a particular case from the operation of the rules.
Attorneys; Petitioners are entitled to attorney’s fees; Court, however, are not convinced with the
petitioner’s arguments that the services RADA rendered merit the amount they are claiming.—We
understand that Atty. Francisco Rilloraza handled the case from its inception until ETPI terminated the
law firm’s services in 1988. Petitioner’s claim for attorney’s fees hinges on two grounds: first, the fact
that Atty. Rilloraza personally handled the case when he was working for SAGA; and second, the
retainer agreement dated October 1, 1987. We agree that petitioners are entitled to attorneys’ fees.
We, however, are not convinced with the petitioner’s arguments that the services RADA rendered merit
the amount they are claiming.
When a client employs the services of a law firm, he does not employ the services of the lawyer who is
assigned to personally handle the case.—Petitioner contends that Atty. Rilloraza initiated the filing of
the complaint. When a client employs the services of a law firm, he does not employ the services of the
lawyer who is assigned to personally handle the case. Rather, he employs the entire law firm. In the
event that the counsel appearing for the client resigns, the firm is bound to provide a replacement.
Thus, RADA could not claim to have initiated the filing of the complaint considering that ETPI hired
SAGA. What is more, on September 17, 1987, ETPI paid SAGA the amount of One Hundred Thousand
Pesos (P100,000.00) representing services performed prior to September 17, 1987. SAGA assigned one
of its associates, Atty. Francisco Rilloraza, to handle the case for the firm. Although Atty. Rilloraza
handled the case personally, he did so for and in behalf of SAGA.
Whether there is an agreement or not, the courts shall fix a reasonable compensation which lawyers
may receive for their professional services.—“In any case, whether there is an agreement or not, the
courts shall fix a reasonable compensation which lawyers may receive for their professional services.”
“A lawyer has the right to be paid for the legal services he has extended to his client, which
compensation must be reasonable.” A lawyer would be entitled to receive what he merits for his
services. Otherwise stated, the amount must be determined on a quantum meruit basis.
Meaning of Quantum Meruit; When recovery of attorney’s fees on the basis of quantum meruit is
authorized.—“Quantum meruit, meaning ‘as much as he deserved’ is used as a basis for determining
the lawyer’s professional fees in the absence of a contract but recoverable by him from his client.”
Recovery of attorney’s fees on the basis of quantum meruit is authorized when (1) there is no express
contract for payment of attorney’s fees agreed upon between the lawyer and the client; (2) when
although there is a formal contract for attorney’s fees, the fees stipulated are found unconscionable or

unreasonable by the court; and (3) when the contract for attorney’s fees is void due to purely formal
defects of execution; (4) when the counsel, for justifiable cause, was not able to finish the case to its
conclusion; (5) when lawyer and client disregard the contract for attorney’s fees.
Elements to be considered in fixing a reasonable compensation for the services rendered by a lawyer on
the basis of quantum meruit.—In fixing a reasonable compensation for the services rendered by a
lawyer on the basis of quantum meruit, the elements to be considered are generally (1) the importance
of the subject matter in controversy, (2) the extent of services rendered, and (3) the professional
standing of the lawyer. A determination of these factors would indispensably require nothing less than a
fullblown trial where private respondents can adduce evidence to establish the right to lawful attorney’s
fees and for petitioner to oppose or refute the same. The trial court has the principal task of fixing the
amount of attorney’s fees. Hence, the necessity of a hearing is beyond cavil.
Charging Lien; A charging lien to be enforceable as security for the payment of attorney’s fees requires
as a condition sine qua non a judgment for money and execution in pursuance of such judgment
secured in the main action by the attorney in favor of his client.—A charging lien to be enforceable as
security for the payment of attorney’s fees requires as a condition sine qua non a judgment for money
and execution in pursuance of such judgment secured in the main action by the attorney in favor of his
client. A charging lien presupposes that the attorney has secured a favorable money judgment for his
client. From the facts of the case it would seem that petitioner had no hand in the settlement that
occurred, nor did it ever obtain a favorable judgment for ETPI.
PETITION for review on certiorari of a decision of the Court of Appeals.
PARDO, J.:
The Issue
The basic issue submitted for consideration of the Court is whether or not petitioner is entitled to
recover attorney’s fees amounting to Twenty Six Million Three Hundred Fifty Thousand Seven Hundred
Seventy Nine Pesos and Ninety One Centavos (P26,350,779.91) for handling the case for its client
Eastern Telecommunications Philippines, Inc. filed with the Regional Trial Court, Makati, though its
services were terminated in midstream and the client directly compromised the case with the adverse
party.
The Facts
In giving due course to the petition, we carefully considered the facts attendant to the case. On August
28, 1987, Eastern Telecommunications Philippines, Inc. (ETPI) represented by the law firm San Juan,
Africa, Gonzales and San Agustin (SAGA), filed with the Regional Trial Court, Makati, a complaint for
recovery of revenue shares against Philippine Long Distance Telephone Company (PLDT). Atty.
Francisco D. Rilloraza, a partner of the firm, appeared for ETPI.
After ETPI rested its case, it paid SAGA the billed amount of One Hundred Thousand Pesos
(P100,000.00). On September 18, 1987, the trial court issued a resolution granting ETPI’s application
for preliminary restrictive and mandatory injunctions. During this period, SAGA was dissolved and four
of the junior partners formed the law firm Rilloraza, Africa, De Ocampo & Africa (RADA), which took
Legal Ethics No. 5 Attorney C lient Relationship Page |5
over as counsel in the case for ETPI. The latter signed a retainer agreement with counsel dated October
1, 1987.1
Petitioners presented the three aspects of the main case in the trial court. First, the traffic revenue
shares which ETPI sought to recover from PLDT in accordance with the contract between them.
Second, ETPI sought preventive injunctive relief against the PLDT’s threats to deny ETPI access to the
Philippines international gateway switch. Third, ETPI called this the “foreign correspondentships aspect”
where ETPI sought preventive injunctive relief against PLDT’s incursions and inducements directed at
ETPI’s foreign correspondents in Hongkong, Taiwan and Singapore, to break their correspondentship
contracts with PLDT, using the threat of denying them access to the international gateway as leverage.
In this connection, ETPI filed with the trial court two urgent motions for restraining order, one on
October 30, 1987 and another on November 4, 1987. As the applications were not acted upon, ETPI
brought the case up to the Court of Appeals by petition for certiorari. On June 28, 1988, petitioner
received a letter from ETPI signed by E. M. Villanueva, President and Chief Executive Officer. In
substance, the letter stated that ETPI was terminating the retainer contract dated October 1, 1987,
effective June 30, 1988. On June 29, 1988, petitioner filed with the Regional Trial Court a notice of
attorney’s lien, furnishing copies to the plaintiff ETPI, to the signatory of the termination letter and
PLDT. On the same date, petitioner additionally sent a letter to ETPI attaching its partial billing
statement. In its notice, RADA informed the court that there were negotiations toward a compromise
between ETPI and PLDT. In April 1990, petitioner confirmed that indeed the parties arrived at an
amicable settlement and that the same was entered as a judgment. On April 26, 1990, petitioner filed a
motion for the enforcement of attorney’s lien with the Regional Trial Court of Makati and then appraised
the Supreme Court thereof by manifestation.2 We noted the manifestation in a resolution dated July 23,
1990. On May 24, 1990, PLDT filed with the trial court a manifestation that it is not a party to nor in
any manner involved in the attorney’s lien being asserted by Atty. Rilloraza for and in behalf of the law
firm,3 while ETPI filed its opposition thereto on June 11, 1990.
The Lower Court’s Ruling
The trial court in its resolution dated September 14, 1990 denied the motion for enforcement of
attorney’s lien. Thus:
“WHEREFORE, premises considered, the court finds that the Notice of Attorney’s Lien filed by the law
firm of Rilloraza, Africa, De Ocampo and Africa has no basis in fact and in law, and therefore denies the
Motion for Enforcement of Attorney’s Lien.
“SO ORDERED.
“Makati, Metro Manila, September 4, 1990.
“(s/t) ZEUS C. ABROGAR “Judge”4
On October 10, 1990, petitioner filed with the trial court a notice of appeal from the above-mentioned
order to the Supreme Court. On November 6, 1990, ETPI filed a Motion to Dismiss Appeal contending
that the case could be brought to the Supreme Court only via a petition for review on certiorari, not by
a mere notice of appeal. In an order dated January 16, 1991, the trial court dismissed RADA’s appeal.
The trial court said:

“There is no more regular appeal from the Regional Trial Court to the Supreme Court. Under the
amendment of Section 17 of the Judiciary Act by R.A. 5440, orders and judgments of the Regional Trial
Court may be elevated to the Supreme Court only by petition for review on certiorari.
“Wherefore, premises considered, the order dated September 14, 1990 is hereby reconsidered and set
aside. The Notice of Appeal filed by movant RADA is dismissed. “SO ORDERED.
“Given this 16th day of January, 1991, at Makati, Metro Manila.
“(s/t) ZEUS C. ABROGAR
“Judge”
Hence, on February 9, 1991, petitioner filed a petition for certiorari with the Supreme Court, which we
remanded to the Court of Appeals. The latter dismissed the petition in a decision promulgated on
November 14, 1991,6 ruling that the judge committed no abuse of discretion in denying petitioner’s
motion for enforcement of attorney’s lien. Thus:
“We therefore rule that respondent judge committed no abuse of discretion, much less a grave one, in
denying petitioner’s motion for enforcement of attorney’s lien.
“Assuming that respondent judge committed an error in denying petitioner’s motion for enforcement of
attorney’s lien, it cannot be corrected by certiorari.
“WHEREFORE, the writs prayed for are DENIED, and the petition is hereby DISMISSED, with cost
against petitioner. “SO ORDERED.
“(s/t) REGINA G. ORDOÑEZ-BENITEZ
“Associate Justice”
“WE CONCUR:
“(s/t) JOSE A. R. MELO
“(s/t) EMETERIO C. CUI “Associate Justice
DISCUSSION
A. The Procedural Aspect
There is nothing sacrosanct about procedural rules, which are liberally construed in order to promote
their objectives and assist the parties in obtaining just, speedy and inexpensive determination of every
action or proceeding.8 In an analogous case,9 we ruled that where the rigid application of the rules
would frustrate substantial justice,10 or bar the vindication of a legitimate grievance, the courts are
justified in exempting a particular case from the operation of the rules.
In A-One Feeds, Inc. vs. Court of Appeals, we said—
“Litigations should, as much as possible, be decided on the merits and not on technicality. Dismissal of
appeals purely on technical grounds is frowned upon, and the rules of procedure ought not to be
applied in a very rigid, technical sense, for they are adopted to help secure, not override, substantial
justice and thereby defeat their very claims. As has been the constant ruling of this Court, every party
litigant should be afforded the amplest opportunity for the proper and just determination of his cause,
free from the constraints of technicalities.”11
Legal Ethics No. 5 Attorney C lient Relationship Page |6
A basic legal principle is that no one shall be unjustly enriched at the expense of another.12 This
principle is one of the mainstays of every legal system for centuries and which the Civil Code echoes:
“ART. 22. Every person who through an act of performance by another, or any other means, acquires
or comes into possession of something at the expense of the latter without just or legal ground, shall
return the same to him.”13
The Code Commission, its report, emphasized that:
“It is most needful that this ancient principle be clearly and specifically consecrated in the proposed Civil
Code to the end that in cases not foreseen by the lawmaker, no one may unjustly benefit himself to the
prejudice of another. The German Civil Code has a similar provision (Art. 812).”14
With this in mind, one could easily understand why, despite technical deficiencies, we resolved to give
due course to this petition. More importantly, the case on its face appears to be impressed with merit.
B. The Attorney’s Fees
We understand that Atty. Francisco Rilloraza handled the case from its inception until ETPI terminated
the law firm’s services in 1988. Petitioner’s claim for attorney’s fees hinges on two grounds: first, the
fact that Atty. Rilloraza personally handled the case when he was working for SAGA; and second, the
retainer agreement dated October 1, 1987.
We agree that petitioners are entitled to attorneys’ fees. We, however, are not convinced with the
petitioner’s arguments that the services RADA rendered merit the amount they are claiming.
First, petitioner contends that Atty. Rilloraza initiated the filing of the complaint. When a client employs
the services of a law firm, he does not employ the services of the lawyer who is assigned to personally
handle the case. Rather, he employs the entire law firm. In the event that the counsel appearing for the
client resigns, the firm is bound to provide a replacement. Thus, RADA could not claim to have initiated
the filing of the complaint considering that ETPI hired SAGA. What is more, on September 17, 1987,
ETPI paid SAGA the amount of One Hundred Thousand Pesos (P100,000.00)15 representing services
performed prior to September 17, 1987. SAGA assigned one of its associates, Atty. Francisco Rilloraza,
to handle the case for the firm. Although Atty. Rilloraza handled the case personally, he did so for and
in behalf of SAGA.
Second, petitioner claims that under the retainer agreement, which provides:
“6.2 B. Court Cases:
Should recourse to judicial action be necessary to effect collection or judicial action be taken by adverse
party, our attorney’s fees shall be fifteen percent (15%) of the amounts collected or the value of the
property acquired or liability saved.”16
the firm is entitled to the fees agreed upon.
However, the retainer agreement has been terminated. True, Attorney Rilloraza played a vital role
during the inception of the case and in the course of the trial. We cannot also ignore the fact that an
attorney-client relationship between petitioner and respondent no longer existed during its culmination

by amicable agreement. To award the attorneys’ fees amounting to 15% of the sum of One Hundred
Twenty Five Million Six Hundred Seventy One Thousand Eight Hundred Eighty Six Pesos and Four
Centavos (P125,671,886.04) plus Fifty Million Pesos (P50,000,000.00) paid by PLDT to ETPI would be
too unconscionable.
“In any case, whether there is an agreement or not, the courts shall fix a reasonable compensation
which lawyers may receive for their professional services.”17 “A lawyer has the right to be paid for the
legal services he has extended to his client, which compensation must be reasonable.”18 A lawyer
would be entitled to receive what he merits for his services. Otherwise stated, the amount must be
determined on a quantum meruit basis.
“Quantum meruit, meaning ‘as much as he deserved’ is used as a basis for determining the lawyer’s
professional fees in the absence of a contract but recoverable by him from his client.”19 Recovery of
attorney’s fees on the basis of quantum meruit is authorized when (1) there is no express contract for
payment of attorney’s fees agreed upon between the lawyer and the client; (2) when although there is
a formal contract for attorney’s fees, the fees stipulated are found unconscionable or unreasonable by
the court; and (3) when the contract for attorney’s fees is void due to purely formal defects of
execution; (4) when the counsel, for justifiable cause, was not able to finish the case to its conclusion;
(5) when lawyer and client disregard the contract for attorney’s fees.20
In fixing a reasonable compensation for the services rendered by a lawyer on the basis of quantum
meruit, the elements to be considered are generally (1) the importance of the subject matter in
controversy, (2) the extent of services rendered, and (3) the professional standing of the lawyer. A
determination of these factors would indispensably require nothing less than a full-blown trial where
private respondents can adduce evidence to establish the right to lawful attorney’s fees and for
petitioner to oppose or refute the same.21 The trial court has the principal task of fixing the amount of
attorney’s fees.22 Hence, the necessity of a hearing is beyond cavil.
C. Charging Lien
Petitioner contends that pursuant to Rule 138 of the Revised Rules of Court, it is entitled to a charging
lien. The rule provides:
“Section 37. Attorney’s liens.—An attorney shall have a lien upon the funds, documents and papers of
his client, which have lawfully come into his possession and may retain the same until his lawful fees
and disbursements have been paid, and may apply such funds to the satisfaction thereof. He shall also
have a lien to the same extent upon all judgements for the payment of money, and executions issued in
pursuance of such judgments, which he has secured in a litigation of his client, from and after the time
when he shall have caused a statement of his claim of such lien to be entered upon the records of the
court rendering such judgment, or issuing such execution, and shall have caused written notice thereof
to be delivered to his client and to the adverse party; and he shall have the same right and power over
such judgments and executions as his client would have to enforce his lien and secure the payment of
his just fees and disbursements.” (Emphasis supplied)
We do not agree. A charging lien to be enforceable as security for the payment of attorney’s fees
requires as a condition sine qua non a judgment for money and execution in pursuance of such
judgment secured in the main action by the attorney in favor of his client.23 A charging lien
Legal Ethics No. 5 Attorney C lient Relationship Page |7
presupposes that the attorney has secured a favorable money judgment for his client.24 From the facts
of the case it would seem that petitioner had no hand in the settlement that occurred, nor did it ever
obtain a favorable judgment for ETPI. ETPI entered into a compromise agreement when it ended the
services of petitioner and through the effort of ETPI’s new lawyers, the law firm Romulo, Mabanta,
Buenaventura, Sayoc and De los Angeles. Whether there was bad faith in the substitution of the
lawyers to avoid compliance with the retainer agreement could only be determined after a trial of the
case on the merits.
This decision, however, should not be interpreted as to impose upon petitioner any additional burden in
collecting its attorney’s fees. The petitioner must avail itself of the proper remedy in order to forestall
the possibility of any injustice on or unjust enrichment of any of the parties.
The Judgment (Fallo)
ACCORDINGLY, the Court GRANTS the petition, REVERSES the decision of the Court of Appeals in CA-
G.R. SP No. 24463 and REMANDS the case to the court of origin for the determination of the amount of
attorney’s fees to which petitioner is entitled. No costs. SO ORDERED.
Petition granted; Reviewed decision reversed.
Note.—A lawyer has two options as to when to file his claim for professional fees. (Traders Royal Bank
Employees Union-Independent vs. National Labor Relations Commission, 269 SCRA 733 [1997])
No. L-38768. July 23, 1974.*
ORBIT TRANSPORTATION COMPANY, petitioner, vs. WORKMEN’S COMPENSATION
COMMISSION and MELECIO CRESPO in behalf of minor ROSALINE CRESPO, respondents.
Attorneys; Pleadings; Suppression of material facts in pleadings not justified by haste and time-
pressure.—While the Court is disposed under the circumstances to be lenient and to dispose of the
grave transgressions of counsel with a reprimand and warning, the Court deems this a timely occasion
to remind counsel in particular and practitioners in general that time-pressure provides no justification
for the suppression of material and vital facts which bear on the merit or lack of merit of a petition.
Duty to observe requirement provided for by section 5, Rule 7, of the Rules of Court.—Members of the
bar owe fidelity to the courts as well as to their clients and they must show faithful adherence to the
provisions of Rule 7, section 5 that “the signature of an attorney constitutes a certificate by him that he
has read the pleading and that to the best of his knowledge, information and belief, there is good
ground to support it; and that it is not interposed for delay” with the admonition therein that “for a
willful violation of this rule an attorney may be subjected to disciplinary action.”
Mere attachment by attorney of copy of questioned decision to petition constitutes violation of
requirement of section 2, Rule 43, of the Rules of Court.—Counsel’s profferred excused for their
suppression of the material facts that a copy of respondent commission’s decision was attached to the
petition manifestly violates the requirement of Rule 43, section 2 that “the petition shall contain a
concise statement of the issues involved and the grounds relied on for the petition . . ." and that “the
questions raised must be distinctly set forth in the petition.”

Statement of ultimate facts in pleadings.—Rule 8, section 1 lays down the fundamental rule on
pleadings that “Every pleading shall contain in a methodical and logical form, a plain, concise and direct
statement of the ultimate facts on which the party pleading relies for his claim or defense, as the case
may be, omitting the statement of mere evidentiary facts.”
Exhibits or annexes attached to complaint do not take place of statement of ultimate facts.—Exhibits or
annexes attached to a complaint or petition do not take the place of allegations of the ultimate facts
constituting the cause of action (of the complaint or petition) which the pleader is under obligation to
plead concisely and specifically as if his pleading had no annexes, under pain of peremptory dismissal of
his complaint or petition.
Reasons for need to state ultimate facts in pleadings.—Material facts established in the annexes
attached to the complaint or petition which disprove or are contrary to the very allegations of the
pleader should not be suppressed in the pleader’s statement of his case and of the issues involved but
must be specifically averred so that the Court may have before it a full and complete picture of the
questions raised in the light of all the material facts found to have been established at the trial or
hearing.
PETITION FOR REVIEW of a decision and a resolution of the Workmen’s Compensation Commission.
RESOLUTION
TEEHANKEE, J.:
The Court administers a reprimand to counsels for petitioner for not having pleaded and instead having
suppressed from their statement of the case and of the questions of law involved in the petition
material facts found in the respondent commission’s decision sought to be appealed from, which show
the petition’s lack of merit.
On June 13, 1974, Messrs. Sergio D. Vendero and Renerio R. Bartonico as counsel for petitioner filed
the petition at bar for review of respondent Workmen’s Compensation Commission’s decision and
resolution directing petitioner to pay respondent-claimant (as grandchild-dependent of the deceased
driver-employee) inter alia the principal sum of P4,360.00 as compensation and burial expenses.
In their “summary statement of the matters involved,” counsel claimed that the “questions of law
involved” were:
“1. It was an error not to consider the payment of P5,000.00 in Philippine currency as full and complete
payment of the compensation for the death of Ramon Crespo.
“2. It was an error to disregard the express and obvious statement in Exhibit 1 of such payment.”
Counsel further contended that “in this particular case, the petitioner voluntarily paid the amount of
P5,000.00 in cash as evidenced by Exhibit 1. Certainly, the Workmen’s Compensation Commission or
any government agency for that matter cannot say that voluntary payment and the evidence of such
payment violate the provisions of Act 3428 simply because the same did not pass through its office,”
and that "(T)here can be no other conclusion but that the entire case hinges on the question of
whether or not the payment of P5,000.00 in cash as evidenced by Exhibit 1 (Settlement and Release of
Legal Ethics No. 5 Attorney C lient Relationship Page |8
Claim) is in full and complete compensation for the death of Ramon Crespo in accordance with the
Workmen’s Compensation Law. This matter is certainly a question of law.”
Upon consideration of the allegations of the petition and verifying the ratio decidendi of respondent
commission’s decision about which the petition was silent, the Court found that material facts bearing
on the petition’s lack of merit had been suppressed.
In denying the petition for lack of merit, the Court accordingly in its resolution of June 28, 1974
required counsel to show cause why they “should not be disciplinarily dealt with for suppressing from
(their) statement of the case and questions of law involved in the petition the material facts found in
the Workmen’s Compensation Commission’s decision ‘that the amount of P5,000.00 claimed to be the
compensation for the death of Ramon Crespo by the respondent (herein petitioner) is the proceeds of
the insurance procured by the deceased with premiums paid from the daily income of the late Ramon
Crespo’ (at pages 3–4, WCC decision, Annex B, petition) and that the claim was an uncontroverted
claim (at pages 4–5, idem) with the apparent intent of misleading the Court as to the merits of the
petition.'"
Counsel promptly filed their “explanation and apology” on July 11, 1974. They pleaded haste and time
pressure (as indeed they filed the petition at bar within the original ten-day reglementary period) and
“beg(ged) forgiveness and promise(d) to be more cautious and discreet in so filing a pleading with this
Honorable Court or with any court, body or commission for that matter.”
They further sought to explain that "(T)hat matter of payment of P5,000.00 being ‘the proceeds of the
insurance procured by the deceased with premiums paid from the daily income of the late Ramon
Crespo’ (at pages 3–4 WCC decision, Annex ‘B') and the failure to controvert the claim were never
touched and argued against in said petition because first, a copy of the decision was already attached
to the petition forming part thereof; secondly, if the petition were given due course, the entire records
of the case would be elevated to the Honorable Court for evaluation; x x x.”
While the Court is disposed under the circumstances to be lenient and to dispose of the grave
transgressions of counsel with a reprimand and warning, the Court deems this a timely occasion to
remind counsel in particular and practitioners in general that time-pressure provides no justification for
the suppression of material and vital facts which bear on the merit or lack of merit of a petition.
The Court has time and again1 stressed that members of the bar owe fidelity to the courts as well as to
their clients and that they must show faithful adherence to the provisions of Rule 7, section 5 that “the
signature of an attorney constitutes a certificate by him that he has read the pleading and that to the
best of his knowledge, information and belief, there is good ground to support it; and that it is not
interposed for delay” with the admonition therein that “for a willful violation of this rule an attorney may
be subjected to disciplinary action.”
The cooperation of litigants and their attorneys is required so that needless clogging of the court
dockets with unmeritorious cases may be avoided leaving the courts free to devote their time and
attention to meritorious and truly contentious cases. In this, the attorney plays a major role of advising
his client to refrain from seeking further appellate review and action in plainly untenable cases.
Counsel’s profferred excuse for their suppression of the material facts that the receipt signed by the
deceased employee’s heirs was in payment of the deceased’s insurance (not compensation) and that

respondent was entitled to the compensation award as the claim was uncontroverted, to wit, that a
copy of respondent commission’s decision was attached to the petition, manifestly violates the
requirement of Rule 43, section 22 that “the petition shall contain a concise statement of the issues
involved and the grounds relied on for the petition . . “and that “the questions raised must be distinctly
set forth in the petition.”
Rule 8, section 1 lays down the fundamental rule on pleadings that “Every pleading shall contain in a
methodical and logical form, a plain, concise and direct statement of the ultimate facts on which the
party pleading relies for his claim
Hence, the Court has always stressed the long-standing fundamental doctrine of Cañete vs. Wislizenus4
that exhibits or annexes attached to a complaint or petition do not take the place of allegations of the
ultimate facts constituting the cause of action (of the complaint or petition) which the pleader is under
obligation to plead concisely and specifically as if his pleading had no annexes, under pain of
peremptory dismissal of his complaint or petition. Justice Moreland thus succintly explained the
rationale for this basic rule: "(A.) court is not obliged, in order to know what the plaintiff s cause of
action is, to search through a list of exhibits, more or less lengthy, and select what the court presumes
the pleader intended to allege. The complaint itself must contain all of the facts necessary to establish
plaintiffs cause of action so that when the court reads it it can see upon the face of the complaint itself
whether or not a cause of action is stated. If the pleader desires to refer to any motion or order or
other proceeding and to make it a part of his complaint he must set out in the complaint itself the
nature of the proceeding and the substance thereof in such a way as to show its relationship to and its
effect upon the cause of action.”
It is plainly evident by the same token that material facts established in the annexes attached to the
complaint or petition which disprove or are contrary to the very allegations of the pleader should not be
suppressed in the pleader’s statement of his case and of the issues involved but must be specifically
averred so that the Court may have before it a full and complete picture of the questions raised in the
light of all the material facts fuly found to have been established at the trial or hearing.
ACCORDINGLY, the Court administers a reprimand to Attys. Sergio D. Vendero and Renerio R. Bartonico
with the warning that a repetition of the same or other violations of their attorney’s oath will be
severely dealth with. Let copies of this resolution be entered in their personal record and f urnished the
Integrated Bar of the Philippines.
Counsels reprimanded.
Notes.—(a) Verification by party’s attorney.—As for respondent’s claim that the present petition is
fatally defective because it is not properly verified, that is, counsel who verified the petition did not
swear that the contents thereof are true of his own knowledge but only “to the best of his knowledge
and belief’; the claim in untenable because it is only when the person verifying is other than the
attorney who signs the pleading that the affiant must state that the allegations thereof are true of his
knowledge, but when the complaint is signed by the attorney, the latter’s oath couched in the usual
form “subscribed and sworn to before me, etc.” is substantial compliance with the rules. Besides, it has
been held that where the affiant swears that the contents of the complaint “are true to the best of his
knowledge, information and belief’ or “to the best of his knowledge and belief,” the verification is
sufficient. (Cajefe vs. Fernandez, L-15709, Oct. 19, 1960).
Legal Ethics No. 5 Attorney C lient Relationship Page |9
(b) Liberal construction of pleadings.—By Section 17, Rule 15 of the Rules of Court, “All pleadings shall
be liberally construed so as to do substantial justice.” And Section 2, Rule 1 of the same rules enjoins
that the Rules of Court should “be liberally construed in order to promote their object and to assist the
parties in obtaining just, speedy and inexpensive determination of every action and proceeding.” We
adhere to the following pronouncement called from Alonso vs. Villamor, 16 Phil. 315, 322: “Technicality,
when it deserts its proper office as an aid to justice and becomes its great hindrance and chief enemy,
deserves scant consideration from the courts. There should be no vested rights in technicalities.”
(Galutira vs. Ramones, CA 10354-R. June 29, 1955)
LEGAL RESEARCH SERVICE
———o0o——— Orbit Trans. Co. vs. Workmen ‘s Compensation Commission, 58 SCRA 78, No. L-38768
July 23, 1974
G.R. No. 105938. September 20, 1996.*
TEODORO R. REGALA, EDGARDO J. ANGARA, AVELINO V. CRUZ, JOSE C. CONCEPCION,
ROGELIO A. VINLUAN, VICTOR P. LAZATIN, and EDUARDO U. ESCUETA, petitioners, vs. THE
HONORABLE SANDIGANBAYAN, First Division, REPUBLIC OF THE PHILIPPINES, ACTING
THROUGH THE PRESIDENTIAL COMMISSION ON GOOD GOVERNMENT, and RAUL S. ROCO,
respondents.
PARAJA G. HAYUDINI, petitioner, vs. THE SANDIGANBAYAN and THE REPUBLIC OF THE
PHILIPPINES, respondents.
Attorneys; Lawyer-Client Relationship; Petitioners are being prosecuted solely on the basis of activities
and services performed in the course of their duties as lawyers.—It would seem that petitioners are
merely standing in for their clients as defendants in the complaint. Petitioners are being prosecuted
solely on the basis of activities and services performed in the course of their duties as lawyers. Quite
obviously, petitioners’ inclusion as co-defendants in the complaint is merely being used as leverage to
compel them to name their clients and consequently to enable the PCGG to nail these clients. Such
being the case, respondent PCGG has no valid cause of action as against petitioners and should exclude
them from the Third Amended Complaint.
An attorney is more than a mere agent or servant because he possesses special powers of trust and
confidence reposed on him by his client.—In modern day perception of the lawyer-client relationship,
an attorney is more than a mere agent or servant, because he possesses special powers of trust and
confidence reposed on him by his client. A lawyer is also as independent as the judge of the court, thus
his powers are entirely different from and superior to those of an ordinary agent. Moreover, an attorney
also occupies what may be considered as a “quasi-judicial office” since he is in fact an officer of the
Court and exercises his judgment in the choice of courses of action to be taken favorable to his client.
In the creation of lawyer-client relationship there are rules, ethical conduct and duties that breathe life
into it.—Thus, in the creation of lawyer-client relationship, there are rules, ethical conduct and duties

that breathe life into it, among those, the fiduciary duty to his client which is of a very delicate, exacting
and confidential character, requiring a very high degree of fidelity and good faith, that is required by
reason of necessity and public interest based on the hypothesis that abstinence from seeking legal
advice in a good cause is an evil which is fatal to the administration of justice.
Generally, a lawyer may not invoke the privilege and refuse to divulge the name or identity of his
client.—As a matter of public policy, a client’s identity should not be shrouded in mystery. Under this
premise, the general rule in our jurisdiction as well as in the United States is that a lawyer may not
invoke the privilege and refuse to divulge the name or identity of his client.
Client identity is privileged where a strong probability exists that revealing the client’s name would
implicate that client in the very activity for which he sought the lawyer’s advice.—Client identity is
privileged where a strong probability exists that revealing the client’s name would implicate that client
in the very activity for which he sought the lawyer’s advice.
Where disclosure would open the client to civil liability his identity is privileged.—Where disclosure
would open the client to civil liability, his identity is privileged. For instance, the peculiar facts and
circumstances of Neugass v. Terminal Cab Corporation, prompted the New York Supreme Court to allow
a lawyer’s claim to the effect that he could not reveal the name of his client because this would expose
the latter to civil litigation.
The content of any client communication to a lawyer lies within the privilege if it is relevant to the
subject matter of the legal problem on which the client seeks legal assistance.—Apart from these
principal exceptions, there exist other situations which could qualify as exceptions to the general rule.
For example, the content of any client communication to a lawyer lies within the privilege if it is
relevant to the subject matter of the legal problem on which the client seeks legal assistance. Moreover,
where the nature of the attorney-client relationship has been previously disclosed and it is the identity
which is intended to be confidential, the identity of the client has been held to be privileged, since such
revelation would otherwise result in disclosure of the entire transaction.
The lawyer-client confidentiality privilege and lawyer’s loyalty to his client extends even after the
termination of the relationship.—The utmost zeal given by Courts to the protection of the lawyer-client
confidentiality privilege and lawyer’s loyalty to his client is evident in the duration of the protection,
which exists not only during the relationship, but extends even after the termination of the relationship.
VITUG, J., Separate Opinion:
Attorneys; Lawyer-Client Relationship; It is unreasonable for the Sandiganbayan to compel petitioners
to breach the trust reposed on them and succumb to a thinly disguised threat of incrimination.—I see in
the case before us, given the attendant circumstances already detailed in the ponencia, a situation of
the Republic attempting to establish a case not on what it perceives to be the strength of its own
evidence but on what it could elicit from a counsel against his client. I find it unreasonable for the
Sandiganbayan to compel petitioners to breach the trust reposed on them and succumb to a thinly
disguised threat of incrimination.
DAVIDE, JR., J., Dissenting Opinion:
L e g a l E t h i c s N o . 5 A t t o r n e y C l i e n t R e l a t i o n s h i p P a g e | 10
Attorneys; Lawyer-Client Relationship; The prerogative to determine who shall be made defendant in a
civil case is initially vested in the plaintiff.—The prerogative to determine who shall be made defendants
in a civil case is initially vested in the plaintiff, or the PCGG in this case. The control of the Court comes
in only when the issue of “interest” (§2, Rule 3, Rules of Court) as, e.g., whether an indispensable party
has not been joined, or whether there is a misjoinder of parties (§7, 8, and 9, Id.), is raised.
Same; Same; The rule of confidentiality under the lawyer-client relationship is not a cause to exclude a
party.—In view of their adamantine position, the petitioners did not, therefore, allow themselves to be
like Roco. They cannot claim the same treatment, much less compel the PCGG to drop them as
defendants, for nothing whatsoever. They have no right to make such a demand for until they shall
have complied with the conditions imposed for their exclusion, they cannot be excluded except by way
of a motion to dismiss based on the grounds allowed by law (e.g., those enumerated in §1, Rule 16,
Rules of Court). The rule of confidentiality under the lawyer-client relationship is not a cause to exclude
a party. It is merely a ground for disqualification of a witness (§24, Rule 130, Rules of Court) and may
only be invoked at the appropriate time, i.e., when a lawyer is under compulsion to answer as witness,
as when, having taken the witness stand, he is questioned as to such confidential communication or
advice, or is being otherwise judicially coerced to produce, through subpoenae duces tecum or
otherwise, letters or other documents containing the same privileged matter.
But none of the lawyers in this case is being required to testify about or otherwise reveal “any
[confidential] communication made by the client to him, or his advice given thereon in the course of, or
with a view to, professional employment.”
PUNO, J., Dissenting Opinion:
Attorneys; Lawyer-Client Relationship; The relation of attorney and client cannot exist for the purpose
of counsel in concocting crimes.—Communications to an attorney having for their object the
commission of a crime “x x x partake the nature of a conspiracy, and it is not only lawful to divulge
such communications, but under certain circumstances it might become the duty of the attorney to do
so. The interests of public justice require that no such shield from merited exposure shall be interposed
to protect a person who takes counsel how he can safely commit a crime. The relation of attorney and
client cannot exist for the purpose of counsel in concocting crimes.” In the well chosen words of retired
Justice Quiason, a lawyer is not a gun for hire.
Same; Same; As a general rule, the attorney-client privilege does not include the right of non-disclosure
of client identity.—Assuming then that petitioners can invoke the attorney-client privilege since the
PCGG is no longer proceeding against them as co-conspirators in crimes, we should focus on the more
specific issue of whether the attorney-client privilege includes the right not to divulge the identity of a
client as contended by the petitioners. As a general rule, the attorney-client privilege does not include
the right of non-disclosure of client identity. The general rule, however, admits of well-etched
exceptions which the Sandiganbayan failed to recognize.
Same; Same; The person claiming the privilege or its exceptions has the obligation to present the
underlying facts demonstrating the existence of the privilege.—Be that as it may, I part ways with the
majority when it ruled that petitioners need not prove they fall within the exceptions to the general
rule. I respectfully submit that the attorney-client privilege is not a magic mantra whose invocation will
ipso facto and ipso jure drape he who invokes it with its protection. Plainly put, it is not enough to

assert the privilege. The person claiming the privilege or its exceptions has the obligation to present the
underlying facts demonstrating the existence of the privilege.
When these facts can be presented only by revealing the very information sought to be protected by
the privilege, the procedure is for the lawyer to move for an inspection of the evidence in an in camera
hearing. The hearing can even be in camera and ex-parte.
SPECIAL CIVIL ACTION in the Supreme Court. Certiorari.
KAPUNAN, J.:
These cases touch the very cornerstone of every State’s judicial system, upon which the workings of
the contentious and adversarial system in the Philippine legal process are based—the sanctity of
fiduciary duty in the client-lawyer relationship. The fiduciary duty of a counsel and advocate is also
what makes the law profession a unique position of trust and confidence, which distinguishes it from
any other calling. In this instance, we have no recourse but to uphold and strengthen the mantle of
protection accorded to the confidentiality that proceeds from the performance of the lawyer’s duty to
his client.
The facts of the case are undisputed.
The matters raised herein are an offshoot of the institution of the Complaint on July 31, 1987 before
the Sandiganbayan by the Republic of the Philippines, through the Presidential Commission on Good
Government against Eduardo M. Cojuangco, Jr., as one of the principal defendants, for the recovery of
alleged ill-gotten wealth, which includes shares of stocks in the named corporations in PCGG Case No.
33 (Civil Case No. 0033), entitled “Republic of the Philippines versus Eduardo Cojuangco, et al.”1
Among the defendants named in the case are herein petitioners Teodoro Regala, Edgardo J. Angara,
Avelino V. Cruz, Jose C. Concepcion, Rogelio A. Vinluan, Victor P. Lazatin, Eduardo U. Escueta and
Paraja G. Hayudini, and herein private respondent Raul S. Roco, who all were then partners of the law
firm Angara, Abello, Concepcion, Regala and Cruz Law Offices (hereinafter referred to as the ACCRA
Law Firm). ACCRA Law Firm performed legal services for its clients, which included, among others, the
organization and acquisition of business associations and/or organizations, with the correlative and
incidental services where its members acted as incorporators, or simply, as stockholders. More
specifically, in the performance of these services, the members of the law firm delivered to its client
documents which substantiate the client’s equity holdings, i.e., stock certificates endorsed in blank
representing the shares registered in the client’s name, and a blank deed of trust or assignment
covering said shares. In the course of their dealings with their clients, the members of the law firm
acquire information relative to the assets of clients as well as their personal and business
circumstances. As members of the ACCRA Law Firm, petitioners and private respondent Raul Roco
admit that they assisted in the organization and acquisition of the companies included in Civil Case No.
0033, and in keeping with the office practice, ACCRA lawyers acted as nominees-stockholders of the
said corporations involved in sequestration proceedings.2
On August 20, 1991, respondent Presidential Commission on Good Government (hereinafter referred to
as respondent PCGG) filed a “Motion to Admit Third Amended Complaint” and “Third Amended
Complaint” which excluded private respondent Raul S. Roco from the complaint in PCGG Case No. 33 as
party-defendant.3 Respondent PCGG based its exclusion of private respondent Roco as party-defendant
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on his undertaking that he will reveal the identity of the principal/s for whom he acted as
nominees/stockholder in the companies involved in PCGG Case No. 33.4
Petitioners were included in the Third Amended Complaint on the strength of the following allegations:
14. Defendants Eduardo Cojuangco, Jr., Edgardo J. Angara, Jose C. Concepcion, Teodoro Regala,
Avelino V. Cruz, Rogelio A. Vinluan, Eduardo U. Escueta, Paraja G. Hayudini and Raul Roco of the
Angara Concepcion Cruz Regala and Abello Law Offices (ACCRA) plotted, devised, schemed, conspired
and confederated with each other in setting up, through the use of the coconut levy funds, the financial
and corporate framework and structures that led to the establishment of UCPB, UNICOM, COCOLIFE,
COCOMARK, CIC, and more than twenty other coconut levy funded corporations, including the
acquisition of San Miguel Corporation shares and its institutionalization through presidential directives of
the coconut monopoly. Through insidious means and machinations, ACCRA, being the wholly-owned
investment arm, ACCRA Investments Corporation, became the holder of approximately fifteen million
shares representing roughly 3.3% of the total outstanding capital stock of UCPB as of 31 March 1987.
This ranks ACCRA Investments Corporation number 44 among the top 100 biggest stockholders of
UCPB which has approximately 1,400,000 shareholders. On the other hand, corporate books show the
name Edgardo J. Angara as holding approximately 3,744 shares as of February, 1984.5
In their answer to the Expanded Amended Complaint, petitioners ACCRA lawyers alleged that:
4.4. Defendants-ACCRA lawyers’ participation in the acts with which their co-defendants are charged,
was in furtherance of legitimate lawyering.
4.4.1. In the course of rendering professional and legal services to clients, defendants-ACCRA lawyers,
Jose C. Concepcion, Teodoro D. Regala, Rogelio A. Vinluan and Eduardo U. Escueta, became holders of
shares of stock in the corporations listed under their respective names in Annex ‘A’ of the expanded
Amended Complaint as incorporating or acquiring stockholders only and, as such, they do not claim any
proprietary interest in the said shares of stock.
4.5. Defendant ACCRA-lawyer Avelino V. Cruz was one of the incorporators in 1976 of Mermaid
Marketing Corporation, which was organized for legitimate business purposes not related to the
allegations of the expanded Amended Complaint. However, he has long ago transferred any material
interest therein and therefore denies that the ‘shares’ appearing in his name in Annex ‘A’ of the
expanded Amended Complaint are his assets.6
Petitioner Paraja Hayudini, who had separated from ACCRA law firm, filed a separate answer denying
the allegations in the complaint implicating him in the alleged ill-gotten wealth.7
Petitioners ACCRA lawyers subsequently filed their “COMMENT AND/OR OPPOSITION” dated October 8,
1991 with Counter-Motion that respondent PCGG similarly grant the same treatment to them (exclusion
as parties-defendants) as accorded private respondent Roco.8 The Counter-Motion for dropping
petitioners from the complaint was duly set for hearing on October 18, 1991 in accordance with the
requirements of Rule 15 of the Rules of Court.
In its “Comment,” respondent PCGG set the following conditions precedent for the exclusion of
petitioners, namely: (a) the disclosure of the identity of its clients; (b) submission of documents

substantiating the lawyer-client relationship; and (c) the submission of the deeds of assignments
petitioners executed in favor of its clients covering their respective shareholdings.9
Consequently, respondent PCGG presented supposed proof to substantiate compliance by private
respondent Roco of the conditions precedent to warrant the latter’s exclusion as party-defendant in
PCGG Case No. 33, to wit: (a) Letter to respondent PCGG of the counsel of respondent Roco dated May
24, 1989 reiterating a previous request for reinvestigation by the PCGG in PCGG Case No. 33; (b)
Affidavit dated March 8, 1989 executed by private respondent Roco as Attachment to the letter
aforestated in (a); and (c) Letter of the Roco, Bunag, and Kapunan Law Offices dated September 21,
1988 to the respondent PCGG in behalf of private respondent Roco originally requesting the
reinvestigation and/or reexamination of the evidence of the PCGG against Roco in its Complaint in
PCGG Case No. 33.10
It is noteworthy that during said proceedings, private respondent Roco did not refute petitioners’
contention that he did actually not reveal the identity of the client involved in PCGG Case No. 33, nor
had he undertaken to reveal the identity of the client for whom he acted as nominee-stockholder.11
On March 18, 1992, respondent Sandiganbayan promulgated the Resolution, herein questioned,
denying the exclusion of petitioners in PCGG Case No. 33, for their refusal to comply with the conditions
required by respondent PCGG. It held:
x x x.
ACCRA lawyers may take the heroic stance of not revealing the identity of the client for whom they
have acted, i.e., their principal, and that will be their choice. But until they do identify their clients,
considerations of whether or not the privilege claimed by the ACCRA lawyers exists cannot even begin
to be debated. The ACCRA lawyers cannot excuse themselves from the consequences of their acts until
they have begun to establish the basis for recognizing the privilege; the existence and identity of the
client.
This is what appears to be the cause for which they have been impleaded by the PCGG as defendants
herein.
5. The PCGG is satisfied that defendant Roco has demonstrated his agency and that Roco has
apparently identified his principal, which revelation could show the lack of cause against him. This in
turn has allowed the PCGG to exercise its power both under the rules of Agency and under Section 5 of
E.O. No. 14-A in relation to the Supreme Court’s ruling in Republic v. Sandiganbayan (173 SCRA 72).
The PCGG has apparently offered to the ACCRA lawyers the same conditions availed of by Roco; full
disclosure in exchange for exclusion from these proceedings (par. 7, PCGG’s COMMENT dated
November 4, 1991). The ACCRA lawyers have preferred not to make the disclosures required by the
PCGG.
The ACCRA lawyers cannot, therefore, begrudge the PCGG for keeping them as party defendants. In
the same vein, they cannot compel the PCGG to be accorded the same treatment accorded to Roco.
Neither can this Court.
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WHEREFORE, the Counter Motion dated October 8, 1991 filed by the ACCRA lawyers and joined in by
Atty. Paraja G. Hayudini for the same treatment by the PCGG as accorded to Raul S. Roco is DENIED
for lack of merit.12
ACCRA lawyers moved for a reconsideration of the above resolution but the same was denied by the
respondent Sandiganbayan. Hence, the ACCRA lawyers filed the petition for certiorari, docketed as G.R.
No. 105938, invoking the following grounds:
I
The Honorable Sandiganbayan gravely abused its discretion in subjecting petitioners ACCRA lawyers
who undisputably acted as lawyers in serving as nominee-stockholders, to the strict application of the
law of agency.
II
The Honorable Sandiganbayan committed grave abuse of discretion in not considering petitioners
ACCRA lawyers and Mr. Roco as similarly situated and, therefore, deserving of equal treatment.
1. There is absolutely no evidence that Mr. Roco had revealed, or had undertaken to reveal, the
identities of the client(s) for whom he acted as nominee-stockholder.
2. Even assuming that Mr. Roco had revealed, or had undertaken to reveal, the identities of the
client(s), the disclosure does not constitute a substantial distinction as would make the classification
reasonable under the equal protection clause.
3. Respondent Sandiganbayan sanctioned favoritism and undue preference in favor of Mr. Roco in
violation of the equal protection clause.
III
The Honorable Sandiganbayan committed grave abuse of discretion in not holding that, under the facts
of this case, the attorney-client privilege prohibits petitioners ACCRA lawyers from revealing the identity
of their client(s) and the other information requested by the PCGG.
1. Under the peculiar facts of this case, the attorney-client privilege includes the identity of the client(s).
2. The factual disclosures required by the PCGG are not limited to the identity of petitioners ACCRA
lawyers’ alleged client(s) but extend to other privileged matters.
IV
The Honorable Sandiganbayan committed grave abuse of discretion in not requiring that the dropping
of party-defendants by the PCGG must be based on reasonable and just grounds and with due
consideration to the constitutional right of petitioners ACCRA lawyers to the equal protection of the law.
Petitioner Paraja G. Hayudini, likewise, filed his own motion for reconsideration of the March 18, 1991
resolution which was denied by respondent Sandiganbayan. Thus, he filed a separate petition for
certiorari, docketed as G.R. No. 108113, assailing respondent Sandiganbayan’s resolution on essentially
the same grounds averred by petitioners in G.R. No. 105938.

Petitioners contend that the exclusion of respondent Roco as party-defendant in PCGG Case No. 33
grants him a favorable treatment, on the pretext of his alleged undertaking to divulge the identity of his
client, giving him an advantage over them who are in the same footing as partners in the ACCRA law
firm. Petitioners further argue that even granting that such an undertaking has been assumed by
private respondent Roco, they are prohibited from revealing the identity of their principal under their
sworn mandate and fiduciary duty as lawyers to uphold at all times the confidentiality of information
obtained during such lawyer-client relationship.
Respondent PCGG, through its counsel, refutes petitioners’ contention, alleging that the revelation of
the identity of the client is not within the ambit of the lawyer-client confidentiality privilege, nor are the
documents it required (deeds of assignment) protected, because they are evidence of nominee
status.13
In his comment, respondent Roco asseverates that respondent PCGG acted correctly in excluding him
as party-defendant because he “(Roco) has not filed an Answer. PCGG had therefore the right to
dismiss Civil Case No. 0033 as to Roco ‘without an order of court by filing a notice of dismissal,’ ”14 and
he has undertaken to identify his principal.15
Petitioners’ contentions are impressed with merit.
I their duties as lawyers. Quite obviously, petitioners’ inclusion as co-defendants in the complaint is
It is quite apparent that petitioners were impleaded by the PCGG as co-defendants to force them to
disclose the identity of their clients. Clearly, respondent PCGG is not after petitioners but the “bigger
fish” as they say in street parlance. This ploy is quite clear from the PCGG’s willingness to cut a deal
with petitioners—the names of their clients in exchange for exclusion from the complaint. The
statement of the Sandi-ganbayan in its questioned resolution dated March 18, 1992 is explicit:
ACCRA lawyers may take the heroic stance of not revealing the identity of the client for whom they
have acted, i.e., their principal, and that will be their choice. But until they do identify their clients,
considerations of whether or not the privilege claimed by the ACCRA lawyers exists cannot even begin
to be debated. The ACCRA lawyers cannot excuse themselves from the consequences of their acts until
they have begun to establish the basis for recognizing the privilege; the existence and identity of the
client.
This is what appears to be the cause for which they have been impleaded by the PCGG as defendants
herein. (Italics ours)
In a closely related case, Civil Case No. 0110 of the Sandi-ganbayan, Third Division, entitled “Primavera
Farms, Inc., et al. vs. Presidential Commission on Good Government” respondent PCGG, through
counsel Mario Ongkiko, manifested at the hearing on December 5, 1991 that the PCGG wanted to
establish through the ACCRA that their “so called client is Mr. Eduardo Cojuangco;” that “it was Mr.
Eduardo Cojuangco who furnished all the monies to those subscription payments in corporations
included in Annex “A” of the Third Amended Complaint;” that the ACCRA lawyers executed deeds of
trust and deeds of assignment, some in the name of particular persons, some in blank.
We quote Atty. Ongkiko:
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ATTY. ONGKIKO:
With the permission of this Hon. Court. I propose to establish through these ACCRA lawyers that, one,
their so called client is Mr. Eduardo Cojuangco. Second, it was Mr. Eduardo Cojuangco who furnished all
the monies to these subscription payments of these corporations who are now the petitioners in this
case. Third, that these lawyers executed deeds of trust, some in the name of a particular person, some
in blank. Now, these blank deeds are important to our claim that some of the shares are actually being
held by the nominees for the late President Marcos. Fourth, they also executed deeds of assignment
and some of these assignments have also blank assignees. Again, this is important to our claim that
some of the shares are for Mr. Cojuangco and some are for Mr. Marcos. Fifth, that most of these
corporations are really just paper corporations. Why do we say that? One: There are no really fixed sets
of officers, no fixed sets of direc- tors at the time of incorporation and even up to 1986, which is the
crucial year. And not only that, they have no permits from the municipal authorities in Makati. Next,
actually all their addresses now are care of Villareal Law Office. They really have no address on records.
These are some of the principal things that we would ask of these nominees stockholders, as they
called themselves.16
It would seem that petitioners are merely standing in for their clients as defendants in the complaint.
Petitioners are being prosecuted solely on the basis of activities and services performed in the course of
merely being used as leverage to compel them to name their clients and consequently to enable the
PCGG to nail these clients. Such being the case, respondent PCGG has no valid cause of action as
against petitioners and should exclude them from the Third Amended Complaint.
II
The nature of lawyer-client relationship is premised on the Roman Law concepts of locatio conductio
operarum (contract of lease of services) where one person lets his services and another hires them
without reference to the object of which the services are to be performed, wherein lawyers’ services
may be compensated by honorarium or for hire,17 and mandato (contract of agency) wherein a friend
on whom reliance could be placed makes a contract in his name, but gives up all that he gained by the
contract to the person who requested him.18 But the lawyer-client relationship is more than that of the
principal-agent and lessor-lessee.
In modern day perception of the lawyer-client relationship, an attorney is more than a mere agent or
servant, because he possesses special powers of trust and confidence reposed on him by his client.19 A
lawyer is also as independent as the judge of the court, thus his powers are entirely different from and
superior to those of an ordinary agent.20 Moreover, an attorney also occupies what may be considered
as a “quasi-judicial office” since he is in fact an officer of the Court21 and exercises his judgment in the
choice of courses of action to be taken favorable to his client.
Thus, in the creation of lawyer-client relationship, there are rules, ethical conduct and duties that
breathe life into it, among those, the fiduciary duty to his client which is of a very delicate, exacting and
confidential character, requiring a very high degree of fidelity and good faith,22 that is required by
reason of necessity and public interest23 based on the hypothesis that abstinence from seeking legal
advice in a good cause is an evil which is fatal to the administration of justice.24

It is also the strict sense of fidelity of a lawyer to his client that distinguishes him from any other
professional in society. This conception is entrenched and embodies centuries of established and stable
tradition.25 In Stockton v. Ford,26 the U.S. Supreme Court held:
There are few of the business relations of life involving a higher trust and confidence than that of
attorney and client, or generally speaking, one more honorably and faithfully discharged; few more
anxiously guarded by the law, or governed by the sterner principles of morality and justice; and it is the
duty of the court to administer them in a corresponding spirit, and to be watchful and industrious, to
see that confidence thus reposed shall not be used to the detriment or prejudice of the rights of the
party bestowing it.27
In our jurisdiction, this privilege takes off from the old Code of Civil Procedure enacted by the Philippine
Commission on August 7, 1901. Section 383 of the Code specifically “forbids counsel, without authority
of his client to reveal any communication made by the client to him or his advice given thereon in the
course of professional employment.”28 Passed on into various provisions of the Rules of Court, the
attorney-client privilege, as currently worded provides:
Sec. 24. Disqualification by reason of privileged communication.—The following persons cannot testify
as to matters learned in confidence in the following cases:
An attorney cannot, without the consent of his client, be examined as to any communication made by
the client to him, or his advice given thereon in the course of, or with a view to, professional
employment, can an attorney’s secretary, stenographer, or clerk be examined, without the consent of
the clientand his employer, concerning any fact the knowledge of whichhas been acquired in such
capacity.29
Further, Rule 138 of the Rules of Court states:
Sec. 20. It is the duty of an attorney: (e) to maintain inviolate the confidence, and at every peril to
himself, to preserve the secrets of his client, and to accept no compensation in connection with his
client’s business except from him or with his knowledge and approval.
This duty is explicitly mandated in Canon 17 of the Code of Professional Responsibility which provides
that:
Canon 17. A lawyer owes fidelity to the cause of his client and he shall be mindful of the trust and
confidence reposed in him.
Canon 15 of the Canons of Professional Ethics also demands a lawyer’s fidelity to client:
The lawyer owes “entire devotion to the interest of the client, warm zeal in the maintenance and
defense of his rights and the exertion of his utmost learning and ability,” to the end that nothing be
taken or be withheld from him, save by the rules of law, legally applied. No fear of judicial disfavor or
public popularity should restrain him from the full discharge of his duty. In the judicial forum the client
is entitled to the benefit of any and every remedy and defense that is authorized by the law of the land,
and he may expect his lawyer to assert every such remedy or defense. But it is steadfastly to be borne
in mind that the great trust of the lawyer is to be performed within and not without the bounds of the
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law. The office of attorney does not permit, much less does it demand of him for any client, violation of
law or any manner of fraud or chicanery. He must obey his own conscience and not that of his client.
Considerations favoring confidentiality in lawyer-client relationships are many and serve several
constitutional and policy concerns. In the constitutional sphere, the privilege gives flesh to one of the
most sacrosanct rights available to the accused, the right to counsel. If a client were made to choose
between legal representation without effective communication and disclosure and legal representation
with all his secrets revealed then he might be compelled, in some instances, to either opt to stay away
from the judicial system or to lose the right to counsel. If the price of disclosure is too high, or if it
amounts to self incrimination, then the flow of information would be curtailed thereby rendering the
right practically nugatory. The threat this represents against another sacrosanct individual right, the
right to be presumed innocent is at once self-evident.
Encouraging full disclosure to a lawyer by one seeking legal services opens the door to a whole
spectrum of legal options which would otherwise be circumscribed by limited information engendered
by a fear of disclosure. An effective lawyer-client relationship is largely dependent upon the degree of
confidence which exists between lawyer and client which in turn requires a situation which encourages
a dynamic and fruitful exchange and flow of information. It necessarily follows that in order to attain
effective representation, the lawyer must invoke the privilege not as a matter of option but as a matter
of duty and professional responsibility.
The question now arises whether or not this duty may be asserted in refusing to disclose the name of
petitioners’ client(s) in the case at bar. Under the facts and circumstances obtaining in the instant case,
the answer must be in the affirmative.
As a matter of public policy, a client’s identity should not be shrouded in mystery.30 Under this premise,
the general rule in our jurisdiction as well as in the United States is that a lawyer may not invoke the
privilege and refuse to divulge the name or identity of his client.31
The reasons advanced for the general rule are well established.
First, the court has a right to know that the client whose privileged information is sought to be
protected is flesh and blood.
Second, the privilege begins to exist only after the attorney-client relationship has been established.
The attorney-client privilege does not attach until there is a client.
Third, the privilege generally pertains to the subject matter of the relationship.
Finally, due process considerations require that the opposing party should, as a general rule, know his
adversary. “A party suing or sued is entitled to know who his opponent is.”32 He cannot be obliged to
grope in the dark against unknown forces.33
Notwithstanding these considerations, the general rule is however qualified by some important
exceptions.
1) Client identity is privileged where a strong probability exists that revealing the client’s name would
implicate that client in the very activity for which he sought the lawyer’s advice.

In Ex-Parte Enzor,34 a state supreme court reversed a lower court order requiring a lawyer to divulge
the name of her client on the ground that the subject matter of the relationship was so closely related
to the issue of the client’s identity that the privilege actually attached to both. In Enzor, the unidentified
client, an election official, informed his attorney in confidence that he had been offered a bribe to
violate election laws or that he had accepted a bribe to that end. In her testimony, the attorney
revealed that she had advised her client to count the votes correctly, but averred that she could not
remember whether her client had been, in fact, bribed. The lawyer was cited for contempt for her
refusal to reveal his client’s identity before a grand jury. Reversing the lower court’s contempt orders,
the state supreme court held that under the circumstances of the case, and under the exceptions
described above, even the name of the client was privileged.
U.S. v. Hodge and Zweig,35 involved the same exception, i.e., that client identity is privileged in those
instances where a strong probability exists that the disclosure of the client’s identity would implicate the
client in the very criminal activity for which the lawyer’s legal advice was obtained.
The Hodge case involved federal grand jury proceedings inquiring into the activities of the “Sandino
Gang,” a gang involved in the illegal importation of drugs in the United States. The respondents, law
partners, represented key witnesses and suspects including the leader of the gang, Joe Sandino.
In connection with a tax investigation in November of 1973, the IRS issued summons to Hodge and
Zweig, requiring them to produce documents and information regarding payment received by Sandino
on behalf of any other person, and vice versa. The lawyers refused to divulge the names. The Ninth
Circuit of the United States Court of Appeals, upholding non-disclosure under the facts and
circumstances of the case, held:
A client’s identity and the nature of that client’s fee arrangements may be privileged where the person
invoking the privilege can show that a strong probability exists that disclosure of such information
would implicate that client in the very criminal activity for which legal advice was sought Baird v.
Koerner, 279 F. 2d at 680. While in Baird Owe enunciated this rule as a mater of California law, the rule
also reflects federal law. Appellants contend that the Baird exception applies to this case.
The Baird exception is entirely consonant with the principal policy behind the attorney-client privilege.
“In order to promote freedom of consultation of legal advisors by clients, the apprehension of
compelled disclosure from the legal advisors must be removed; hence, the law must prohibit such
disclosure except on the client’s consent.” 8 J. Wigmore, supra sec. 2291, at 545. In furtherance of this
policy, the client’s identity and the nature of his fee arrangements are, in exceptional cases, protected
as confidential communications.36
2) Where disclosure would open the client to civil liability, his identity is privileged. For instance, the
peculiar facts and circumstances of Neugass v. Terminal Cab Corporation,37 prompted the New York
Supreme Court to allow a lawyer’s claim to the effect that he could not reveal the name of his client
because this would expose the latter to civil litigation.
In the said case, Neugass, the plaintiff, suffered injury when the taxicab she was riding, owned by
respondent corporation, collided with a second taxicab, whose owner was unknown. Plaintiff brought
action both against defendant corporation and the owner of the second cab, identified in the
information only as John Doe. It turned out that when the attorney of defendant corporation appeared
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on preliminary examination, the fact was somehow revealed that the lawyer came to know the name of
the owner of the second cab when a man, a client of the insurance company, prior to the institution of
legal action, came to him and reported that he was involved in a car accident. It was apparent under
the circumstances that the man was the owner of the second cab. The state supreme court held that
the reports were clearly made to the lawyer in his professional capacity. The court said:
That his employment came about through the fact that the insurance company had hired him to defend
its policyholders seems immaterial. The attorney in such cases is clearly the attorney for the
policyholder when the policyholder goes to him to report an occurrence contemplating that it would be
used in an action or claim against him.38
x x x.
All communications made by a client to his counsel, for the purpose of professional advice or
assistance, are privileged, whether they relate to a suit pending or contemplated, or to any other
matter proper for such advice or aid; x x x And whenever the communication made, relates to a matter
so connected with the employment as attorney or counsel as to afford presumption that it was the
ground of the address by the client, then it is privileged from disclosure. x x x. It appears . . . that the
name and address of the owner of the second cab came to the attorney in this case as a confidential
communication. His client is not seeking to use the courts, and his address cannot be disclosed on that
theory, nor is the present action pending against him as service of the summons on him has not been
effected. The objections on which the court reserved decision are sustained.39
In the case of Matter of Shawmut Mining Company,40 the lawyer involved was required by a lower
court to disclose whether he represented certain clients in a certain transaction. The purpose of the
court’s request was to determine whether the unnamed persons as interested parties were connected
with the purchase of properties involved in the action. The lawyer refused and brought the question to
the State Supreme Court. Upholding the lawyer’s refusal to divulge the names of his clients the court
held:
If it can compel the witness to state, as directed by the order appealed from, that he represented
certain persons in the purchase or sale of these mines, it has made progress in establishing by such
evidence their version of the litigation. As already suggested, such testimony by the witness would
compel him to disclose not only that he was attorney for certain people, but that, as the result of
communications made to him in the course of such employment as such attorney, he knew that they
were interested in certain transactions. We feel sure that under such conditions no case has ever gone
to the length of compelling an attorney, at the instance of a hostile litigant, to disclose not only his
retainer, but the nature of the transactions to which it related, when such information could be made
the basis of a suit against his client.41
3) Where the government’s lawyers have no case against an attorney’s client unless, by revealing the
client’s name, the said name would furnish the only link that would form the chain of testimony
necessary to convict an individual of a crime, the client’s name is privileged.
In Baird vs. Korner,42 a lawyer was consulted by the accountants and the lawyer of certain undisclosed
taxpayers regarding steps to be taken to place the undisclosed taxpayers in a favorable position in case
criminal charges were brought against them by the U.S. Internal Revenue Service (IRS).

It appeared that the taxpayers’ returns of previous years were probably incorrect and the taxes
understated. The clients themselves were unsure about whether or not they violated tax laws and
sought advice from Baird on the hypothetical possibility that they had. No investigation was then being
undertaken by the IRS of the taxpayers. Subsequently, the attorney of the taxpayers delivered to Baird
the sum of $12,706.85, which had been previously assessed as the tax due, and another amount of
money representing his fee for the advice given. Baird then sent a check for $12,706.85 to the IRS in
Baltimore, Maryland, with a note explaining the payment, but without naming his clients. The IRS
demanded that Baird identify the lawyers, accountants, and other clients involved. Baird refused on the
ground that he did not know their names, and declined to name the attorney and accountants because
this constituted privileged communication. A petition was filed for the enforcement of the IRS
summons. For Baird’s repeated refusal to name his clients he was found guilty of civil contempt. The
Ninth Circuit Court of Appeals held that, a lawyer could not be forced to reveal the names of clients who
employed him to pay sums of money to the government voluntarily in settlement of undetermined
income taxes, unsued on, and with no government audit or investigation into that client’s income tax
liability pending. The court emphasized the exception that a client’s name is privileged when so much
has been revealed concerning the legal services rendered that the disclosure of the client’s identity
exposes him to possible investigation and sanction by government agencies. The Court held:
The facts of the instant case bring it squarely within that exception to the general rule. Here money
was received by the government, paid by persons who thereby admitted they had not paid a sufficient
amount in income taxes some one or more years in the past. The names of the clients are useful to the
government for but one purpose—to ascertain which taxpayers think they were delinquent, so that it
may check the records for that one year or several years. The voluntary nature of the payment
indicates a belief by the taxpayers that more taxes or interest or penalties are due than the sum
previously paid, if any. It indicates a feeling of guilt for non-payment of taxes, though whether it is
criminal guilt is undisclosed. But it may well be the link that could form the chain of testimony
necessary to convict an individual of a federal crime. Certainly the payment and the feeling of guilt are
the reasons the attorney here involved was employed—to advise his clients what, under the
circumstances, should be done.43
Apart from these principal exceptions, there exist other situations which could qualify as exceptions to
the general rule.
For example, the content of any client communication to a lawyer lies within the privilege if it is
relevant to the subject matter of the legal problem on which the client seeks legal assistance.44
Moreover, where the nature of the attorney-client relationship has been previously disclosed and it is
the identity which is intended to be confidential, the identity of the client has been held to be
privileged, since such revelation would otherwise result in disclosure of the entire transaction.45
Summarizing these exceptions, information relating to the identity of a client may fall within the ambit
of the privilege when the client’s name itself has an independent significance, such that disclosure
would then reveal client confidences.46
The circumstances involving the engagement of lawyers in the case at bench, therefore, clearly reveal
that the instant case falls under at least two exceptions to the general rule. First, disclosure of the
alleged client’s name would lead to establish said client’s connection with the very fact in issue of the
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case, which is privileged information, because the privilege, as stated earlier, protects the subject
matter or the substance (without which there would be no attorney-client relationship).
The link between the alleged criminal offense and the legal advice or legal service sought was duly
established in the case at bar, by no less than the PCGG itself. The key lies in the three specific
conditions laid down by the PCGG which constitutes petitioners’ ticket to non-prosecution should they
accede thereto:
(a) the disclosure of the identity of its clients;
(b) submission of documents substantiating the lawyer-client relationship; and
(c) the submission of the deeds of assignment petitioners executed in favor of their clients covering
their respective shareholdings.
From these conditions, particularly the third, we can readily deduce that the clients indeed consulted
the petitioners, in their capacity as lawyers, regarding the financial and corporate structure, framework
and set-up of the corporations in question. In turn, petitioners gave their professional advice in the
form of, among others, the aforementioned deeds of assignment covering their clients’ shareholdings.
There is no question that the preparation of the aforestated documents was part and parcel of
petitioners’ legal service to their clients. More important, it constituted an integral part of their duties as
lawyers. Petitioners, therefore, have a legitimate fear that identifying their clients would implicate them
in the very activity for which legal advice had been sought, i.e., the alleged accumulation of ill-gotten
wealth in the aforementioned corporations.
Furthermore, under the third main exception, revelation of the client’s name would obviously provide
the necessary link for the prosecution to build its case, where none otherwise exists. It is the link, in the
words of Baird, “that would inevitably form the chain of testimony necessary to convict the (client) of a
. . . crime.”47
An important distinction must be made between a case where a client takes on the services of an
attorney for illicit purposes, seeking advice about how to go around the law for the purpose of
committing illegal activities and a case where a client thinks he might have previously committed
something illegal and consults his attorney about it. The first case clearly does not fall within the
privilege because the same cannot be invoked for purposes illegal. The second case falls within the
exception because whether or not the act for which the client sought advice turns out to be illegal, his
name cannot be used or disclosed if the disclosure leads to evidence, not yet in the hands of the
prosecution, which might lead to possible action against him.
These cases may be readily distinguished, because the privilege cannot be invoked or used as a shield
for an illegal act, as in the first example; while the prosecution may not have a case against the client in
the second example and cannot use the attorney client relationship to build up a case against the latter.
The reason for the first rule is that it is not within the professional character of a lawyer to give advice
on the commission of a crime.48 The reason for the second has been stated in the cases above
discussed and are founded on the same policy grounds for which the attorney-client privilege, in
general, exists.
In Matter of Shawmut Mining Co., supra, the appellate court therein stated that “under such conditions
no case has ever yet gone to the length of compelling an attorney, at the instance of a hostile litigant,

to disclose not only his retainer, but the nature of the transactions to which it related, when such
information could be made the basis of a suit against his client.”49 “Communications made to an
attorney in the course of any personal employment, relating to the subject thereof, and which may be
supposed to be drawn out in consequence of the relation in which the parties stand to each other, are
under the seal of confidence and entitled to protection as privileged communications.”50 Where the
communicated information, which clearly falls within the privilege, would suggest possible criminal
activity but there would be not much in the information known to the prosecution which would sustain
a charge except that revealing the name of the client would open up other privileged information which
would substantiate the prosecution’s suspicions, then the client’s identity is so inextricably linked to the
subject matter itself that it falls within the protection. The Baird exception, applicable to the instant
case, is consonant with the principal policy behind the privilege, i.e., that for the purpose of promoting
freedom of consultation of legal advisors by clients, apprehension of compelled disclosure from
attorneys must be eliminated. This exception has likewise been sustained in In re Grand Jury
Proceedings51 and Tillotson v. Boughner.52 What these cases unanimously seek to avoid is the
exploitation of the general rule in what may amount to a fishing expedition by the prosecution.
There are, after all, alternative sources of information available to the prosecutor which do not depend
on utilizing a defendant’s counsel as a convenient and readily available source of information in the
building of a case against the latter. Compelling disclosure of the client’s name in circumstances such as
the one which exists in the case at bench amounts to sanctioning fishing expeditions by lazy
prosecutors and litigants which we cannot and will not countenance. When the nature of the
transaction would be revealed by disclosure of an attorney’s retainer, such retainer is obviously
protected by the privilege.53 It follows that petitioner attorneys in the instant case owe their client(s) a
duty and an obligation not to disclose the latter’s identity which in turn requires them to invoke the
privilege.
In fine, the crux of petitioners’ objections ultimately hinges on their expectation that if the prosecution
has a case against their clients, the latter’s case should be built upon evidence painstakingly gathered
by them from their own sources and not from compelled testimony requiring them to reveal the name
of their clients, information which unavoidably reveals much about the nature of the transaction which
may or may not be illegal. The logical nexus between name and nature of transaction is so intimate in
this case that it would be difficult to simply dissociate one from the other. In this sense, the name is as
much “communication” as information revealed directly about the transaction in question itself, a
communication which is clearly and distinctly privileged. A lawyer cannot reveal such communication
without exposing himself to charges of violating a principle which forms the bulwark of the entire
attorney-client relationship.
The uberrimei fidei relationship between a lawyer and his client therefore imposes a strict liability for
negligence on the former. The ethical duties owing to the client, including confidentiality, loyalty,
competence, diligence as well as the responsibility to keep clients informed and protect their rights to
make decisions have been zealously sustained. In Milbank, Tweed, Hadley and McCloy v. Boon,54 the
US Second District Court rejected the plea of the petitioner law firm that it breached its fiduciary duty to
its client by helping the latter’s former agent in closing a deal for the agent’s benefit only after its client
hesitated in proceeding with the transaction, thus causing no harm to its client. The Court instead ruled
that breaches of a fiduciary relationship in any context comprise a special breed of cases that often
loosen normally stringent requirements of causation and damages, and found in favor of the client.
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To the same effect is the ruling in Searcy, Denney, Scarola, Barnhart, and Shipley P.A. v. Scheller55
requiring strict obligation of lawyers vis-a-vis clients. In this case, a contingent fee lawyer was fired
shortly before the end of completion of his work, and sought payment quantum meruit of work done.
The court, however, found that the lawyer was fired for cause after he sought to pressure his client into
signing a new fee agreement while settlement negotiations were at a critical stage. While the client
found a new lawyer during the interregnum, events forced the client to settle for less than what was
originally offered. Reiterating the principle of fiduciary duty of lawyers to clients in Meinhard v.
Salmon56 famously attributed to Justice Benjamin Cardozo that “Not honesty alone, but the punctilio of
an honor the most sensitive, is then the standard of behaviour,” the US Court found that the lawyer
invoked was fired for cause, thus deserved no attorney’s fees at all.
The utmost zeal given by Courts to the protection of the lawyer-client confidentiality privilege and
lawyer’s loyalty to his client is evident in the duration of the protection, which exists not only during the
relationship, but extends even after the termination of the relationship.57
Such are the unrelenting duties required of lawyers vis-avis their clients because the law, which the
lawyers are sworn to uphold, in the words of Oliver Wendell Homes,58 “x x x is an exacting goddess,
demanding of her votaries in intellectual and moral discipline.” The Court, no less, is not prepared to
accept respondents’ position without denigrating the noble profession that is lawyering, so extolled by
Justice Holmes in this wise:
Every calling is great when greatly pursued. But what other gives such scope to realize the spontaneous
energy of one’s soul? In what other does one plunge so deep in the stream of life—so share its
passions, its battles, its despair, its triumphs, both as witness and actor? x x x But that is not all. What
a subject is this in which we are united—this abstraction called the Law, wherein as in a magic mirror,
we see reflected, not only in our lives, but the lives of all men that have been. When I think on this
majestic theme my eyes dazzle. If we are to speak of the law as our mistress, we who are here know
that she is a mistress only to be won with sustained and lonely passion—only to be won by straining all
the faculties by which man is likened to God.
We have no choice but to uphold petitioners’ right not to reveal the identity of their clients under pain
of the breach of fiduciary duty owing to their clients, because the facts of the instant case clearly fall
within recognized exceptions to the rule that the client’s name is not privileged information.
If we were to sustain respondent PCGG that the lawyer-client confidential privilege under the
circumstances obtaining here does not cover the identity of the client, then it would expose the lawyers
themselves to possible litigation by their clients in view of the strict fiduciary responsibility imposed on
them in the exercise of their duties.
The complaint in Civil Case No. 0033 alleged that the defendants therein, including herein petitioners
and Eduardo Cojuangco, Jr. conspired with each other in setting up through the use of coconut levy
funds the financial and corporate framework and structures that led to the establishment of UCPB,
UNICOM and others and that through insidious means and machinations, ACCRA, using its wholly-
owned investment arm, ACCRA Investments Corporation, became the holder of approximately fifteen
million shares representing roughly 3.3% of the total capital stock of UCPB as of 31 March 1987. The
PCGG wanted to establish through the ACCRA lawyers that Mr. Cojuangco is their client and it was
Cojuangco who furnished all the monies to the subscription payment; hence, petitioners acted as

dummies, nominees and/or agents by allowing themselves, among others, to be used as instrument in
accumulating ill-gotten wealth through government concessions, etc., which acts constitute gross abuse
of official position and authority, flagrant breach of public trust, unjust enrichment, violation of the
Constitution and laws of the Republic of the Philippines.
By compelling petitioners, not only to reveal the identity of their clients, but worse, to submit to the
PCGG documents substantiating the client-lawyer relationship, as well as deeds of assignment
petitioners executed in favor of its clients covering their respective shareholdings, the PCGG would
exact from petitioners a link “that would inevitably form the chain of testimony necessary to convict the
(client) of a crime.”
III
In response to petitioners’ last assignment of error, respondents allege that the private respondent was
dropped as party defendant not only because of his admission that he acted merely as a nominee but
also because of his undertaking to testify to such facts and circumstances “as the interest of truth may
require, which includes . . . the identity of the principal.”59
First, as to the bare statement that private respondent merely acted as a lawyer and nominee, a
statement made in his out-of-court settlement with the PCGG, it is sufficient to state that petitioners
have likewise made the same claim not merely out-of-court but also in their Answer to plaintiff’s
Expanded Amended Complaint, signed by counsel, claiming that their acts were made in furtherance of
“legitimate lawyering.”60 Being “similarly situated” in this regard, public respondents must show that
there exist other conditions and circumstances which would warrant their treating the private
respondent differently from petitioners in the case at bench in order to evade a violation of the equal
protection clause of the Constitution.
To this end, public respondents contend that the primary consideration behind their decision to sustain
the PCGG’s dropping of private respondent as a defendant was his promise to disclose the identities of
the clients in question. However, respondents failed to show—and absolutely nothing exists in the
records of the case at bar—that private respondent actually revealed the identity of his client(s) to the
PCGG. Since the undertaking happens to be the leitmotif of the entire arrangement between Mr. Roco
and the PCGG, an undertaking which is so material as to have justified PCGG’s special treatment
exempting the private respondent from prosecution, respondent Sandiganbayan should have required
proof of the undertaking more substantial than a “bare assertion” that private respondent did indeed
comply with the undertaking. Instead, as manifested by the PCGG, only three documents were
submitted for the purpose, two of which were mere requests for re-investigation and one simply
disclosed certain clients which petitioners (ACCRA lawyers) were themselves willing to reveal. These
were clients to whom both petitioners and private respondent rendered legal services while all of them
were partners at ACCRA, and were not the clients which the PCGG wanted disclosed for the alleged
questioned transactions.61
To justify the dropping of the private respondent from the case or the filing of the suit in the
respondent court without him, therefore, the PCGG should conclusively show that Mr. Roco was treated
as a species apart from the rest of the ACCRA lawyers on the basis of a classification which made
substantial distinctions based on real differences. No such substantial distinctions exist from the records
of the case at bench, in violation of the equal protection clause.
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The equal protection clause is a guarantee which provides a wall of protection against uneven
application of statutes and regulations. In the broader sense, the guarantee operates against uneven
application of legal norms so that all persons under similar circumstances would be accorded the same
treatment.62 Those who fall within a particular class ought to be treated alike not only as to privileges
granted but also as to the liabilities imposed.
x x x. What is required under this constitutional guarantee is the uniform operation of legal norms so
that all persons under similar circumstances would be accorded the same treatment both in the
privileges conferred and the liabilities imposed. As was noted in a recent decision: ‘Favoritism and
undue preference cannot be allowed. For the principle is that equal protection and security shall be
given to every person under circumstances, which if not identical are analogous. If law be looked upon
in terms of burden or charges, those that fall within a class should be treated in the same fashion,
whatever restrictions cast on some in the group equally binding the rest.’63
We find that the condition precedent required by the respondent PCGG of the petitioners for their
exclusion as parties-defendants in PCGG Case No. 33 violates the lawyer-client confidentiality privilege.
The condition also constitutes a transgression by respondents Sandiganbayan and PCGG of the equal
protection clause of the Constitution.64 It is grossly unfair to exempt one similarly situated litigant from
prosecution without allowing the same exemption to the others. Moreover, the PCGG’s demand not only
touches upon the question of the identity of their clients but also on documents related to the
suspected transactions, not only in violation of the attorney-client privilege but also of the constitutional
right against self-incrimination. Whichever way one looks at it, this is a fishing expedition, a free ride at
the expense of such rights.
An argument is advanced that the invocation by petitioners of the privilege of attorney-client
confidentiality at this stage of the proceedings is premature and that they should wait until they are
called to testify and examine as witnesses as to matters learned in confidence before they can raise
their objections. But petitioners are not mere witnesses. They are co-principals in the case for recovery
of alleged ill-gotten wealth. They have made their position clear from the very beginning that they are
not willing to testify and they cannot be compelled to testify in view of their constitutional right against
self-incrimination and of their fundamental legal right to maintain inviolate the privilege of attorney-
client confidentiality.
It is clear then that the case against petitioners should never be allowed to take its full course in the
Sandiganbayan. Petitioners should not be made to suffer the effects of further litigation when it is
obvious that their inclusion in the complaint arose from a privileged attorney-client relationship and as a
means of coercing them to disclose the identities of their clients. To allow the case to continue with
respect to them when this Court could nip the problem in the bud at this early opportunity would be to
sanction an unjust situation which we should not here countenance. The case hangs as a real and
palpable threat, a proverbial Sword of Damocles over petitioners’ heads. It should not be allowed to
continue a day longer.
While we are aware of respondent PCGG’s legal mandate to recover ill-gotten wealth, we will not
sanction acts which violate the equal protection guarantee and the right against self-incrimination and
subvert the lawyer-client confidentiality privilege.

WHEREFORE, IN VIEW OF THE FOREGOING, the Resolutions of respondent Sandiganbayan (First
Division) promulgated on March 18, 1992 and May 21, 1992 are hereby ANNULLED and SET ASIDE.
Respondent Sandiganbayan is further ordered to exclude petitioners Teodoro D. Regala, Edgardo J.
Angara, Avelino V. Cruz, Jose C. Concepcion, Victor P. Lazatin, Eduardo U. Escueta and Paraja G.
Hayudini as parties-defendants in SB Civil Case No. 0033 entitled “Repub-lic of the Philippines v.
Eduardo Cojuangco, Jr., et al.”SO ORDERED.
SEPARATE OPINION
VITUG, J.:
The legal profession, despite all the unrestrained calumny hurled against it, is still the noblest of
professions. It exists upon the thesis that, in an orderly society that is opposed to all forms of anarchy,
it so occupies, as it should, an exalted position in the proper dispensation of justice. In time, principles
have evolved that would help ensure its effective ministration. The protection of confidentiality of the
lawyer-client relationship is one, and it has since been an accepted firmament in the profession. It
allows the lawyer and the client to institutionalize a unique relationship based on full trust and
confidence essential in a justice system that works on the basis of substantive and procedural due
process. To be sure, the rule is not without its pitfalls, and demands against it may be strong, but these
problems are, in the ultimate analysis, no more than mere tests of vigor that have made and will make
that rule endure.
I see in the case before us, given the attendant circumstances already detailed in the ponencia, a
situation of the Republic attempting to establish a case not on what it perceives to be the strength of its
own evidence but on what it could elicit from a counsel against his client. I find it unreasonable for the
Sandiganbayan to compel petitioners to breach the trust reposed on them and succumb to a thinly
disguised threat of incrimination.
Accordingly, I join my other colleague who vote for the GRANT of the petition.
DISSENTING OPINION
DAVIDE, JR., J.:
The impressive presentation of the case in the ponencia of Mr. Justice Kapunan makes difficult the
espousal of a dissenting view. Nevertheless, I do not hesitate to express that view because I strongly
feel that this Court must confine itself to the key issue in this special civil action for certiorari, viz.,
whether or not the Sandiganbayan acted with grave abuse of discretion in not excluding the
defendants, the petitioners herein, from the Third Amended Complaint in Civil Case No. 0033. That
issue, unfortunately, has been simply buried under the avalanche of authorities upholding the sanctity
of lawyer-client relationship which appears to me to be prematurely invoked.
From the undisputed facts disclosed by the pleadings and summarized in the ponencia, I cannot find my
way clear to a conclusion that the Sandiganbayan committed grave abuse of discretion in not acting
favorably on the petitioners’ prayer in their Comment to the PCGG’s Motion to Admit Third Amended
Complaint.
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The prerogative to determine who shall be made defendants in a civil case is initially vested in the
plaintiff, or the PCGG in this case. The control of the Court comes in only when the issue of “interest”
(§2, Rule 3, Rules of Court), as, e.g., whether an indispensable party has not been joined, or whether
there is a misjoinder of parties (§7, 8, and 9, Id.), is raised.
In the case below, the PCGG decided to drop or exclude from the complaint original co-defendant Raul
Roco because he had allegedly complied with the condition prescribed by the PCGG, viz., undertake
that he will reveal the identity of the principals for whom he acted as nominee/stockholder in the
companies involved in PCGG Case No. 0033. In short, there was an agreement or compromise
settlement between the PCGG and Roco. Accordingly, the PCGG submitted a Third Amended Complaint
without Roco as a defendant. No obstacle to such an agreement has been insinuated. If Roco’s
revelation violated the confidentiality of a lawyer-client relationship, he would be solely answerable
therefor to his principals/clients and, probably, to this Court in an appropriate disciplinary action if
warranted. There is at all no showing that Civil Case No. 0033 cannot further be proceeded upon or
that any judgment therein cannot be binding without Roco remaining as a defendant. Accordingly, the
admission of the Third Amended Complaint cannot be validly withheld by the Sandiganbayan.
Are the petitioners, who did not file a formal motion to be excluded but only made the request to that
effect as a rider to their Comment to the Motion to Admit Third Amended Complaint, entitled to be
excluded from the Third Amended Complaint such that denial thereof would constitute grave abuse of
discretion on the Sandiganbayan’s part? To me, the answer is clearly in the negative.
The petitioners seek to be accorded the same benefit granted to or to be similarly treated as Roco.
Reason and logic dictate that they cannot, unless they too would make themselves like Roco. Otherwise
stated, they must first voluntarily adopt for themselves the factual milieu created by Roco and must
bind themselves to perform certain obligations as Roco. It is precisely for this that in response to the
petitioners’ comment on the aforementioned Motion to Admit Third Amended Complaint the PCGG
manifested that it is willing to accord the petitioners the treatment it gave Roco provided they would do
what Roco had done, that is, disclose the identity of their principals/clients and submit documents
substantiating their claimed lawyer-client relationship with the said principals/clients, as well as copies
of deeds of assignments the petitioners executed in favor of their principals/clients. The petitioners did
not do so because they believed that compliance thereof would breach the sanctity of their fiduciary
duty in a lawyer-client relationship.
It, indeed, appears that Roco has complied with his obligation as a consideration for his exclusion from
the Third Amended Complaint. The Sandiganbayan found that
5. The PCGG is satisfied that defendant Roco has demonstrated his agency and that Roco has
apparently identified his principal, which revelation could show the lack of action against him. This in
turn has allowed the PCGG to exercise its power both under the rules of agency and under Section 5 of
E.O. No. 14-1 in relation to the Supreme Court’s ruling in Republic v. Sandiganbayan (173 SCRA 72).
As a matter of fact, the PCGG presented evidence to substantiate Roco’s compliance. The ponencia
itself so stated, thus:
. . . respondent PCGG presented evidence to substantiate compliance by private respondent Roco of the
conditions precedent to warrant the latter’s exclusion as party-defendant in PCGG Case No. 33, to wit:

(a) Letter to respondent PCGG of the counsel of respondent Roco dated May 24, 1989 reiterating a
previous request for reinvestigation by the PCGG in PCGG Case No. 33; (b) Affidavit dated March 8,
1989 executed by private respondent Roco as Attachment to the letter aforestated in (a); and (c) Letter
of Roco, Bunag, and Kapunan Law Offices dated September 21, 1988 to the respondent in behalf of
private respondent Roco originally requesting the reinvestigation and/or re-examination of evidence by
the PCGG it Complaint in PCGG Case No. 33. (Id., 5-6)
These are the pieces of evidence upon which the Sandiganbayan founded its conclusion that the PCGG
was satisfied with Roco’s compliance. The petitioners have not assailed such finding as arbitrary.
The ponencia’s observation then that Roco did not refute the petitioners’ contention that he did not
comply with his obligation to disclose the identity of his principals is entirely irrelevant.
In view of their adamantine position, the petitioners did not, therefore, allow themselves to be like
Roco. They cannot claim the same treatment, much less compel the PCGG to drop them as defendants,
for nothing whatsoever. They have no right to make such a demand for until they shall have complied
with the conditions imposed for their exclusion, they cannot be excluded except by way of a motion to
dismiss based on the grounds allowed by law (e.g., those enumerated in §1, Rule 16, Rules of Court).
The rule of confidentiality under the lawyer-client relationship is not cause to exclude a party. It is
merely a ground for disqualification of a witness (§24, Rule 130, Rules of Court) and may only be
invoked at the appropriate time, i.e., when a lawyer is under compulsion to answer as witness, as
when, having taken the witness stand, he is questioned as to such confidential communication or
advice, or is being otherwise judicially coerced to produce, through subpoe-nae duces tecum or
otherwise, letters or other documents containing the same privileged matter. But none of the lawyers in
this case is being required to testify about or otherwise reveal “any [confidential] communication made
by the client to him, or his advice given thereon in the course of, or with a view to, professional
employment.” What they are being asked to do, in line with their claim that they had done the acts
ascribed to them in pursuance of their professional relation to their clients, is to identify the latter to the
PCGG and the Court; but this, only if they so choose in order to be dropped from the complaint, such
identification being the condition under which the PCGG has expressed willingness to exclude them
from the action. The revelation is entirely optional, discretionary, on their part. The attorney-client
privilege is not therefor applicable.
Thus, the Sandiganbayan did not commit any abuse of discretion when it denied the petitioners’ prayer
for their exclusion as party-defendants because they did not want to abide with any of the conditions
set by the PCGG. There would have been abuse if the Sandiganbayan granted the prayer because then
it would have capriciously, whimsically, arbitrarily, and oppressively imposed its will on the PCGG.
Again, what the petitioners want is their exclusion from the Third Amended Complaint or the dismissal
of the case insofar as they are concerned because either they are invested with immunity under the
principle of confidentiality in a lawyer-client relationship, or the claims against them in Civil Case No.
0033 are barred by such principle.
Even if we have to accommodate this issue, I still submit that the lawyer-client privilege provides the
petitioners no refuge. They are sued as principal defendants in Civil Case No. 0033, a case for the
recovery of alleged ill-gotten wealth. Conspiracy is imputed to the petitioners therein. In short, they
are, allegedly, conspirators in the commission of the acts complained of for being nominees of certain
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parties. Their inclusion as defendants is justified under §15, Article XI of the Constitution—which
provides that the right of the State to recover properties unlawfully acquired by public officials or
employees, from them or from their nominees or transferees, shall not be barred by prescription, laches
or estoppel—and E.O. No. 1 of 28 February 1986, E.O. No. 2 of 12 March 1986, E.O. No. 14 of 7 May
1986, and the Rules and Regulations of the PCGG. Furthermore, §2, Rule 110 of the Rules of Court
requires that the complaint or information should be “against all persons who appear to be responsible
for the offense involved.”
Hypothetically admitting the allegations in the complaint in Civil Case No. 0033, I find myself unable to
agree with the majority opinion that the petitioners are immune from suit or that they have to be
excluded as defendants, or that they cannot be compelled to reveal or disclose the identity of their
principals, all because of the sacred lawyer-client privilege.
This privilege is well put in Rule 130 of the Rules of Court, to wit:
§ 24. Disqualification by reason of privileged communication.—The following persons cannot testify as
to matters learned in confidence in the following cases:
(b) An attorney cannot, without the consent of his client, be examined as to any communication made
by the client to him, or his advice given thereon in the course of, or with a view to, professional
employment, nor can an attorney’s secretary, stenographer, or clerk be examined, without the consent
of the client and his employer, concerning any fact the knowledge of which has been acquired in such
capacity.
The majority seeks to expand the scope of the Philippine rule on the lawyer-client privilege by copious
citations of American jurisprudence which includes in the privilege the identity of the client under the
exceptional situations narrated therein. From the plethora of cases cited, two facts stand out in bold
relief. Firstly, the issue of privilege contested therein arose in grand jury proceedings on different
States, which are preliminary proceedings before the filing of the case in court, and we are not even
told what evidentiary rules apply in the said hearings. In the present case, the privilege is invoked in
the court where it was already filed and presently pends, and we have the foregoing specific rules
above-quoted. Secondly, and more important, in the cases cited by the majority, the lawyers concerned
were merely advocating the cause of their clients but were not indicted for the charges against their
said clients. Here, the counsel themselves are co-defendants duly charged in court as co-conspirators in
the offenses charged. The cases cited by the majority evidently do not apply to them.
Hence, I wish to repeat and underscore the fact that the lawyer-client privilege is not a shield for the
commission of a crime or against the prosecution of the lawyer therefor. I quote, with emphases
supplied, from 81 AM JUR 2d, Witnesses, §393 to 395, pages 356-357:
§ 393. Effect of unlawful purpose.
The existence of an unlawful purpose prevents the attorney-client privilege from attaching. The
attorney-client privilege does not generally exist where the representation is sought to further criminal
or fraudulent conduct either past, present, or future. Thus, a confidence received by an attorney in
order to advance a criminal or fradulent purpose is beyond the scope of the privilege.

Observation: The common-law rule that the privilege protecting confidential communications between
attorney and client is lost if the relation is abused by a client who seeks legal assistance to perpetrate a
crime or fraud has been codified.
§ 394. Attorney participation.
The attorney-client privilege cannot be used to protect a client in the perpetration of a crime in concert
with the attorney, even where the attorney is not aware of his client’s purpose. The reason for the rule
is that it is not within the professional character of a lawyer to give advice on the commission of crime.
Professional responsibility does not countenance the use of the attorney-client privilege as a subterfuge,
and all conspiracies, either active or passive, which are calculated to hinder the administration of justice
will vitiate the privilege. In some jurisdictions, however, this exception to the rule of privilege is
confined to such intended acts in violation of the law as are mala in se, as distinguished from those
which are merely mala prohibita.
§ 395. Communication in contemplation of crime.
Communications between attorney and client having to do with the client’s contemplated criminal acts,
or in aid or furtherance thereof, are not covered by the cloak of privilege ordinarily existing in reference
to communications between attorney and client. But, the mere charge of illegality, not supported by
evidence, will not defeat the privilege; there must be at least prima facie evidence that the illegality has
some foundation in fact.
Underhill also states:
There are many other cases to the same effect, for the rule is prostitution of the honorable relation of
attorney and client will not be permitted under the guise of privilege, and every communication made
to an attorney by a client for a criminal purpose is a conspiracy or attempt at a conspiracy which is not
only lawful to divulge, but which the attorney under certain circumstances may be bound to disclose at
once in the interest of justice. In accordance with this rule, where a forged will or other false
instrument has come into possession of an attorney through the instrumentality of the accused, with
the hope and expectation that the attorney would take some action in reference thereto, and the
attorney does act, in ignorance of the true character of the instrument, there is no privilege, inasmuch
as full confidence has been withheld. The attorney is then compelled to produce a forged writing
against the client. The fact that the attorney is not cognizant of the criminal or wrongful purpose, or,
knowing it, attempts to dissuade his client, is immaterial. The attorney’s ignorance of his client’s
intentions deprives the information of a professional character as full confidence has been withheld.
(H.C. Underhill, A Treatise on the Law of Criminal Evidence, vol. 2, Fifth ed. (1956), Sec. 332, pp. 836-
837; italics mine).
125 AMERICAN LAW REPORTS ANNOTATED, 516-519, summarizes the rationale of the rule excepting
communications with respect to contemplated criminal or fraudulent acts, thus:
c. Rationale of rule excepting communications with respect to contemplated criminal or fraudulent act.
Various reasons have been announced as being the foundation for the holdings that communications
with respect to contemplated criminal or fraudulent acts are not privileged.
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The reason perhaps most frequently advanced is that in such cases there is no professional
employment, properly speaking. Standard F. Ins. Co. v. Smithhart (1919) 183 Ky 679, 211 SW. 441, 5 ALR 972;
Cummings v. Com. (1927) 221 Ky 301, 298 SW 943; Strong v. Abner (1937) 268 Ky 502, 105 SW (2d) 599; People
v. Van Alstine (1885) 57 Mich 69, 23 NW 594; Hamil & Co. v. England (1892) 50 Mo App 338; Carney v. United R.
Co. (1920) 205 Mo App 495, 226 SW 308; Matthews v. Hoagland (1891) 48 NJ Eq 455, 21 A 1054; Covency v.
Tannahill (1841) 1 Hill (NY) 33, 37 AM Dec 287; People ex rel. Vogelstein v. Warden (1934) 150 Misc 714, 270 NYS
362 (affirmed without opinion in (1934) 242 App Div 611, 271 NYS 1059); Russell v. Jackson (1851) 9 Hare 387, 68
Eng Reprint 558; Charlton v. Coombes (1863) 4 Giff 372, 66 Eng Reprint 751; Reg. v. Cox (1884) LR 14 QB Div
(Eng) 153-CCR; Re Postlethwaite (1887) LR 35 Ch Div (Eng) 722.
In Reg. v. Cox (1884) LR 14 QB Div (Eng) 153-CCR, the court said: “In order that the rule may apply,
there must be both professional confidence and professional employment, but if the client has a
criminal object in view in his communications with his solicitor one of these elements must necessarily
be absent. The client must either conspire with his solicitor or deceive him. If his criminal object is
avowed, the client does not consult his adviser professionally, because it cannot be the solicitor’s
business to further any criminal object. If the client does not avow his object, he reposes no
confidence, for the state of facts which is the foundation of the supposed confidence does not exist.
The solicitor’s advice is obtained by a fraud.”
So, in Standard F. Ins. Co. v. Smithhart (1919) 183 Ky 679, 211 SW 441, 5 ALR 972, the court said:
“The reason of the principle which holds such communications not to be privileged is that it is not
within the professional character of a lawyer to give advice upon such subjects, and that it is no part of
the profession of an attorney or counselor at law to be advising persons as to how they may commit
crimes or frauds, or how they may escape the consequences of contemplated crimes and frauds. If the
crime or fraud has already been committed and finished, a client may advise with an attorney in regard
to it, and communicate with him freely, and the communications cannot be divulged as evidence
without the consent of the client, because it is a part of the business and duty of those engaged in the
practice of the profession of law, when employed and relied upon for that purpose, to give advice to
those who have made infractions of the laws; and, to enable the attorney to properly advise and to
properly represent the client in court or when prosecutions are threatened, it is conducive to the
administration of justice that the client shall be free to communicate to his attorney all the facts within
his knowledge, and that he may be assured that a communication made by him shall not be used to his
prejudice.”
The protection which the law affords to communications between attorney and client has reference to
those which are legitimately and properly within the scope of a lawful employment, and does not
extend to communications made in contemplation of a crime, or perpetration of a fraud. Strong v.
Abner (1937) 268 Ky 502, 105 SW (2d) 599.
The court in People v. Van Alstine (1885) 57 Mich 69, 23 NW 594, in holding not privileged
communications to an attorney having for their object the commission of a crime, said: “They then
partake of the nature of a conspiracy, or attempted conspiracy, and it is not only lawful to divulge such
communications, but under certain circumstances it might become the duty of the attorney to do so.
The interests of public justice require that no such shield from merited exposure shall be interposed to
protect a person who takes counsel how he can safely commit a crime. The relation of attorney and
client cannot exist for the purpose of counsel in concocting crimes.”

And in Coveney v. Tannahill (1841) 1 Hill (NY) 33, 37 Am Dec 287, the court was of the opinion that
there could be no such relation as that of attorney and client, either in the commission of a crime, or in
the doing of a wrong by force or fraud to an individual, the privileged relation of attorney and client
existing only for lawful and honest purposes.
If the client consults the attorney at law with reference to the perpetration of a crime, and they co-
operate in effecting it, there is no privilege, inasmuch as it is no part of the lawyer’s duty to aid in
crime—he ceases to be counsel and becomes a criminal. Matthews v. Hoagland (1891) 48 NJ Eq 455,
21 A 1054.
The court cannot permit it to be said that the contriving of a fraud forms part of the professional
business of an attorney or solicitor. Charlton v. Coombes (1863) 4 Giff 372, 66 Eng Reprint 751. If the
client does not frankly and freely reveal his object and intention as well as facts, there is not
professional confidence, and therefore no privilege. Matthews v. Hoagland (NJ) supra. See to the same
effect Carney v. United R. Co. (1920) 205 Mo App 495, 226 SW 308.
There is no valid claim of privilege in regard to the production of documents passing between solicitor
and client, when the transaction impeached is charged to be based upon fraud, that is the matter to be
investigated, and it is thought better that the alleged privilege should suffer than that honestly and fair
dealing should appear to be violated with impunity. Smith v. Hunt (1901) 1 Ont L Rep 334.
In Tichborne v. Lushington, shorthand Notes (Eng) p. 5211 (cited in Reg. v. Cox (1884) LR 14 QB Div
(Eng) 172-CCR), the chief justice said: “I believe the law is, and properly is, that if a party consults an
attorney, and obtains advice for what afterwards turns out to be the commission of a crime or a fraud,
that party so consulting the attorney has no privilege whatever to close the lips of the attorney from
stating the truth. Indeed, if any such privilege should be contended for, or existing, it would work most
grievous hardship on an attorney, who, after he had been consulted upon what subsequently appeared
to be a manifest crime and fraud, would have his lips closed, and might place him in a very serious
position of being suspected to be a party to the fraud, and without his having an opportunity of
exculpating himself . . . . There is no privilege in the case which I have suggested of a party consulting
another, a professional man, as to what may afterwards turn out to be a crime or fraud, and the best
mode of accomplishing it.”
In Garside v. Outram (1856) 3 Jur NS (Eng) 39, although the question of privilege as to
communications between attorney and client was not involved, the question directly involved being the
competency of a clerk in a business establishment to testify as to certain information which he acquired
while working in the establishment, the court strongly approved of a view as stated arguendo for
plaintiff, in Annesley v. Anglesea (1743) 17 How St Tr (Eng) 1229, as follows: “I shall claim leave to
consider whether an attorney may be examined as to any matter which came to his knowledge as an
attorney. If he is employed as an attorney in any unlawful or wicked act, his duty to the public obliges
him to disclose it; no private obligations can dispense with that universal one which lies on every
member of society to discover every design which may be formed, contrary to the laws of society, to
destroy the public welfare. For this reason, I apprehend that if a secret which is contrary to the public
good, such as a design to commit treason, murder, or perjury, comes to the knowledge of an attorney,
even in a cause where he is concerned, the obligation to the public must dispense with the private
obligation to the client.”
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The court in McMannus v. State (1858) 2 Head (Tenn) 213, said: “It would be monstrous to hold that if
counsel was asked and obtained in reference to a contemplated crime that the lips of the attorney
would be sealed, when the facts might become important to the ends of justice in the prosecution of
crime. In such a case the relation cannot be taken to exist. Public policy would forbid it.”
And the court in Lanum v. Patterson (1909) 151 Ill App 36, observed that this rule was not in
contravention of sound public policy, but on the contrary, tended to the maintenance of a higher
standard of professional ethics by preventing the relation of attorney and client from operating as a
cloak for fraud.
Communications of a client to an attorney are not privileged if they were a request for advice as to how
to commit a fraud, it being in such a case not only the attorney’s privilege, but his duty, to disclose the
facts to the court. Will v. Tornabells & Co. (1907) 3 Porto Rico Fed Rep 125. The court said: “We say
this notwithstanding the comments of opposing counsel as to the indelicacy of his position because of
his being now on the opposite side of the issue that arose as a consequence of the communication he
testifies about, and is interested in the cause to the extent of a large contingent fee, as he confesses.”
The object of prohibiting the disclosure of confidential communications is to protect the client, and not
to make the attorney an accomplice or permit him to aid in the commission of a crime. People vs.
Petersen (1901) 60 App Div 118, NYS 941.
The seal of personal confidence can never be used to cover a transaction which is in itself a crime.
People v. Farmer (1909) 194 NY 251, 87 NE 457.
As to disclosing the identity of a client, 81 AM JUR 2d, Witnesses, § 410 and 411, pages 366-368,
states:
§ 410. Name or identity of client.
Disclosure of a client’s identity is necessary proof of the existence of the attorney-client relationship and
is not privileged information. Thus, the attorney-client privilege is inapplicable even though the
information was communicated confidentially to the attorney in his professional capacity and, in some
cases, in spite of the fact that the attorney may have been sworn to secrecy, where an inquiry is
directed to an attorney as to the name or identity of his client. This general rule applies in criminal
cases, as well as in civil actions. Where an undisclosed client is a party to an action, the opposing party
has a right to know with whom he is contending or who the real party in interest is, if not the nominal
adversary.
§ 411. Disclosure of identity of client as breach of confidentiality.
The revelation of the identification of a client is not usually considered privileged, except where so
much has been divulged with regard to to legal services rendered or the advice sought, that to reveal
the client’s name would be to disclose the whole relationship and confidential communications.
However, even where the subject matter of the attorney-client relationship has already been revealed,
the client’s name has been deemed privileged.

Where disclosure of the identity of a client might harm the client by being used against him under
circumstances where there are no countervailing factors, then the identity is protected by the attor-ney-
client privilege.
In criminal proceedings, a client’s name may be privileged if information already obtained by the
tribunal, combined with the client’s identity, might expose him to criminal prosecution for acts
subsequent to, and because of, which he had sought the advice of his attorney.
Although as a general rule, the identity of a defendant in a criminal prosecution is a matter of public
record and, thus, not covered by the attorney-client privilege, where the attorney has surrendered to
the authorities physical evidence in his possession by way of the attorney-client relationship, the state
must prove the connection between the piece of physical evidence and the defendant without in any
way relying on the testimony of the client’s attorney who initially received the evidence and, thus, the
attorney may not be called to the stand and asked to disclose the identity of the client. However, an
attorney cannot refuse to reveal the identity of a person who asked him to deliver stolen property to
the police department, whether a bona fide attorney-client relationship exists between them, inasmuch
as the transaction was not a legal service or done in the attorney’s professional capacity.
Distinction. Where an attorney was informed by a male client that his female acquaintance was possibly
involved in [a] hit-and-run accident, the identity of the female did not come within scope of attorney-
client privilege although the identity of the male client was protected. (emphases supplied)
WIGMORE explains why the identity of a client is not within the lawyer-client privilege in this manner:
§ 2313. Identity of client or purpose of suit.—The identity of the attorney’s client or the name of the
real party in interest will seldom be a matter communicated in confidence because the procedure of
litigation ordinarily presupposes a disclosure of these facts. Furthermore, so far as a client may in fact
desire secrecy and may be able to secure action without appearing as a party to the proceedings, it
would be improper to sanction such a wish. Every litigant is in justice entitled to know the identity of his
opponents. He cannot be obliged to struggle in the dark against unknown forces. He has by anticipation
the right, in later proceedings, if desired, to enforce the legal responsibility of those who may have
maliciously sued or prosecuted him or fraudulently evaded his claim. He has as much right to ask the
attorney “Who fees your fee?” as to ask the witness (966 supra). “Who maintains you during this trial?”
upon the analogy of the principle already examined (2298 supra), the privilege cannot be used to evade
a client’s responsibility for the use of legal process. And if it is necessary for the purpose to make a
plain exception to the rule of confidence, then it must be made. (Wigmore on Evidence, vol. 8, (1961),
p. 609; emphases supplied).
In 114 ALR, 1322, we also find the following statement:
1. Name or identity.
As is indicated in 28 R.C.L. p. 563, it appears that the rule making communications between attorney
and client privileged from disclosure ordinarily does not apply where the inquiry is confined to the fact
of the attorney’s employment and the name of the person employing him, since the privilege
presupposes the relationship of client and attorney, and therefore does not attach to its creation.
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At the present stage of the proceedings below, the petitioners have not shown that they are so situated
with respect to their principals as to bring them within any of the exceptions established by American
jurisprudence. There will be full opportunity for them to establish that fact at the trial where the
broader perspectives of the case shall have been presented and can be better appreciated by the court.
The insistence for their exclusion from the case is understandable, but the reasons for the hasty
resolution desired is naturally suspect.
We do not even have to go beyond our shores for an authority that the lawyer-client privilege cannot
be invoked to prevent the disclosure of a client’s identity where the lawyer and the client are
conspirators in the commission of a crime or a fraud. Under our jurisdiction, lawyers are mandated not
to counsel or abet activities aimed at defiance of the law or at lessening confidence in the legal system
(Rule 1.02, Canon 1, Code of Professional Responsibility) and to employ only fair and honest means to
attain the lawful objectives of his client (Rule 19.01, Canon 19, Id.). And under the Canons of
Professional Ethics, a lawyer must steadfastly bear in mind that his great trust is to be performed within
and not without the bounds of the law (Canon 15, Id.), that he advances the honor of his profession
and the best interest of his client when he renders service or gives advice tending to impress upon the
client and his undertaking exact compliance with the strictest principles of moral law (Canon 32, Id.).
These canons strip a lawyer of the lawyer-client privilege whenever he conspires with the client in the
commission of a crime or a fraud.
I then vote to DENY, for want of merit, the instant petition.
DISSENTING OPINION
PUNO, J.:
This is an important petition for certiorari to annul the resolutions of the respondent Sandiganbayan
denying petitioners’ motion to be excluded from the Complaint for recovery of alleged ill-gotten wealth
on the principal ground that as lawyers they cannot be ordered to reveal the identity of their client.
First, we fast forward the facts. The Presidential Commission on Good Government (PCGG) filed Civil
Case No. 33 before the Sandiganbayan against Eduardo M. Cojuangco, Jr., for the recovery of alleged
ill-gotten wealth. Sued as co-defendants are the petitioners in the cases at bar—lawyers Teodoro
Regala, Edgardo J. Angara, Avelino V. Cruz, Jose Concepcion, Rogelio A. Vinluan, Victor P. Lazatin,
Eduardo Escueta and Paraja Hayudini. Also included as a co-defendant is lawyer Raul Roco, now a duly
elected senator of the Republic. All co-defendants were then partners of the law firm, Angara, Abello,
Concepcion, Regala and Cruz Law Offices, better known as the ACCRA Law Firm. The Complaint against
Cojuangco, Jr., and the petitioners alleged, inter alia, viz:
“The wrongs committed by defendants acting singly or collectively and in unlawful concert with one
another, include the misappropriation and theft of public funds, plunder of the nation’s wealth,
extortion, blackmail, bribery, embezzlement and other acts of corruption, betrayal of public trust and
brazen abuse of power as more fully described (in the subsequent paragraphs of the complaint), all at
the expense and to the grave and irreparable damage of Plaintiff and the Filipino people.
“Defendants Eduardo Cojuangco, Jr., Edgardo J. Angara, Jose C. Concepcion, Teodoro D. Regala,
Avelino V. Cruz, Regalio A. Vinluan, Eduardo U. Escueta, Paraja G. Hayudini and Raul S. Roco of
Angara, Concepcion, Cruz, Regala, and Abello law offices (ACCRA) plotted, devised, schemed, conspired

and confederated with each other in setting up, through the use of the coconut levy funds, the financial
and corporate framework and structures that led to the establishment of UCPB, UNICOM, COCOLIFE,
COCOMARK, CIC and more than twenty other coconut levy funded corporations, including the
acquisition of the San Miguel Corporation shares and the institutionalization through presidential
directives of the coconut monopoly. Through insidious means and machinations, ACCRA, using its
wholly-owned investment arm, ACCRA Investments Corporation, became the holder of approximately
fifteen million shares representing roughly 3.3% of the total outstanding capital stock of UCPB as of 31
March 1987. This ranks ACCRA Investments Corporation number 44 among the top 100 biggest
stockholders of UCPB which has approximately 1,400,000 shareholders. On the other hand, corporate
books show the name Edgardo J. Angara as holding approximately 3,744 shares as of 7 June 1984.”
In their Answer, petitioners alleged that the legal services offered and made available by their firm to
its clients include: (a) organizing and acquiring business organizations, (b) acting as incorporators or
stockholders thereof, and (c) delivering to clients the corresponding documents of their equity holdings
(i.e., certificates of stock endorsed in blank or blank deeds of trust or assignment). They claimed that
their activities were “in furtherance of legitimate lawyering.”
In the course of the proceedings in the Sandiganbayan, the PCGG filed a Motion to Admit Third
Amended Complaint and the Third Amended Complaint excluding lawyer Roco as party defendant.
Lawyer Roco was excluded on the basis of his promise to reveal the identity of the principals for whom
he acted as nominee/stockholder in the companies involved in the case.
The Sandiganbayan ordered petitioners to comment on the motion. In their Comment, petitioners
demanded that they be extended the same privilege as their co-defendant Roco. They prayed for their
exclusion from the complaint. PCGG agreed but set the following conditions: (1) disclosure of the
identity of their client; (2) submission of documents substantiating their lawyer-client relationship; and
(3) submission of the deeds of assignment petitioners executed in favor of their client covering their
respective shareholdings. The same conditions were imposed on lawyer Roco.
Petitioners refused to comply with the PCGG conditions contending that the attorney-client privilege
gives them the right not to reveal the identity of their client. They also alleged that lawyer Roco was
excluded though he did not in fact reveal the identity of his clients. On March 18, 1992, the
Sandiganbayan denied the exclusion of petitioners in Case No. 33. It held:
“ACCRA lawyers may take the heroic stance of not revealing the identity of the client for whom they
have acted, i.e., their principal, and that will be their choice. But until they do identify their clients,
considerations of whether or not the privilege claimed by the ACCRA lawyers exists cannot even begin
to be debated. The ACCRA lawyers cannot excuse themselves from the consequences of their acts until
they have begun to establish the basis for recognizing the privilege; the existence and identity of the
client.
This is what appears to be the cause for which they have been impleaded by the PCGG as defendants
herein.
5. The PCGG is satisfied that defendant Roco has demonstrated his agency and that Roco has
apparently identified his principal, which revelation could show the lack of cause against him. This in
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turn has allowed the PCGG to exercise its power both under the rules of Agency and under Section 5 of
E.O. No. 14-A in relation to the Supreme Court’s ruling in Republic v. Sandiganbayan (173 SCRA 72).
The PCGG has apparently offered to the ACCRA lawyers the same conditions availed of by Roco; full
disclosure in exchange for exclusion from these proceedings (par. 7, PCGG’s COMMENT dated
November 4, 1991). The ACCRA lawyers have preferred not to make the disclosures required by the
PCGG.
The ACCRA lawyers cannot, therefore, begrudge the PCGG for keeping them as party defendants. In
the same vein, they cannot compel the PCGG to be accorded the same treatment accorded to Roco.
Neither can this Court.
WHEREFORE, the Counter Motion dated October 8, 1991 filed by the ACCRA lawyers and joined in by
Atty. Paraja G. Hayudini for the same treatment by the PCGG as accorded to Raul S. Roco is DENIED
for lack of merit.”
Sandiganbayan later denied petitioners’ motions for reconsideration in its resolutions dated May 21,
1988 and September 3, 1992.
In this petition for certiorari, petitioners contend:
“I “The Honorable Sandiganbayan gravely abused its discretion in subjecting petitioners ACCRA lawyers
who undisputably acted as lawyers in serving as nominee-stockholders, to the strict application of the
law of agency.
“II “The Honorable Sandiganbayan committed grave abuse of discretion in not considering petitioners
ACCRA lawyers and Mr. Roco as similarly situated and, therefore, deserving of equal treatment.
1. There is absolutely no evidence that Mr. Roco had revealed, or had undertaken to reveal, the
identities of the cli-ent(s) for whom he acted as nominee-stockholder.
2. Even assuming that Mr. Roco had revealed, or had undertaken to reveal, the identities of the
client(s), the disclosure does not constitute a substantial distinction as would make the classification
reasonable under the equal protection clause.
3. Respondent Sandiganbayan sanctioned favoritism and undue preference in favor of Mr. Roco in
violation of the equal protection clause.
“III
“The Honorable Sandiganbayan committed grave abuse of discretion in not holding that, under the
facts of this case, the attorney-client privilege prohibits petitioners ACCRA lawyers from revealing the
identity of their client(s) and the other information requested by the PCGG.
1. Under the peculiar facts of this case, the attorney-client privilege includes the identity of the client(s).
2. The factual disclosures required by the PCGG are not limited to the identity of petitioners ACCRA
lawyers’ alleged client(s) but extend to other privileged matters.

IV
“The Honorable Sandiganbayan committed grave abuse of discretion in not requiring that the dropping
of party-defendants by the PCGG must be based on reasonable and just grounds and with due
consideration to the constitutional right of petitioners ACCRA lawyers to the equal protection of the
law.”
The petition at bar is atypical of the usual case where the hinge issue involves the applicability of
attorney-client privilege. It ought to be noted that petitioners were included as defendants in Civil Case
No. 33 as conspirators. Together with Mr. Cojuangco, Jr., they are charged with having “x x x conspired
and confederated with each other in setting up, through the use of the coconut levy funds, the financial
and corporate framework and structures that led to the establishment of UCPB, UNICOM, COCOLIFE,
COCOMARK, CIC and more than twenty other coconut levy funded corporations, including the
acquisition of San Miguel Corporation shares and the institutionalization through presidential directives
of the coconut monopoly.” To stress, petitioners are charged with having conspired in the commission
of crimes. The issue of attorney-client privilege arose when PCGG agreed to exclude petitioners from
the complaint on condition they reveal the identity of their client. Petitioners refused to comply and
assailed the condition on the ground that to reveal the identity of their client will violate the attorney-
client privilege.
It is thus necessary to resolve whether the Sandiganbayan committed grave abuse of discretion when it
rejected petitioners’ thesis that to reveal the identity of their client would violate the attorney-client
privilege. The attorney-client privilege is the oldest of the privileges for confidential communications
known to the common law.1 For the first time in this jurisdiction, we are asked to rule whether the
attorney-client privilege includes the right not to disclose the identity of client. The issue poses a
trilemma for its resolution requires the delicate balancing of three opposing policy considerations. One
overriding policy consideration is the need for courts to discover the truth for truth alone is the true
touchstone of justice.2 Equally compelling is the need to protect the adversary system of justice where
truth is best extracted by giving a client broad privilege to confide facts to his counsel.3 Similarly
deserving of sedulous concern is the need to keep inviolate the constitutional right against self-
incrimination and the right to effective counsel in criminal litigations. To bridle at center the centrifugal
forces of these policy considerations, courts have followed the prudential principle that the attorney-
client privilege must not be expansively construed as it is in derogation of the search for truth.4
Accordingly, a narrow construction has been given to the privilege and it has been consistently held
that “these competing societal interests demand that application of the privilege not exceed that which
is necessary to effect the policy considerations underlying the privilege, i.e., ‘the privilege must be
upheld only in those circumstances for which it was created.’ ”5
Prescinding from these premises, our initial task is to define in clear strokes the substantive content of
the attorney-client privilege within the context of the distinct issues posed by the petition at bar. With
due respect, I like to start by stressing the irreducible principle that the attorney-client privilege can
never be used as a shield to commit a crime or a fraud. Communications to an attorney having for their
object the commission of a crime “x x x partake the nature of a conspiracy, and it is not only lawful to
divulge such communications, but under certain circumstances it might become the duty of the attorney
to do so. The interests of public justice require that no such shield from merited exposure shall be
interposed to protect a person who takes counsel how he can safely commit a crime. The relation of
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attorney and client cannot exist for the purpose of counsel in concocting crimes.”6 In the well chosen
words of retired Justice Quiason, a lawyer is not a gun for hire.7 I hasten to add, however, that a mere
allegation that a lawyer conspired with his client to commit a crime or a fraud will not defeat the
privilege.8 As early as 1933, no less than the Mr. Justice Cardozo held in Clark v. United States9 that:
“there are early cases apparently to the effect that a mere charge of illegality, not supported by any
evidence, will set the confidences free x x x But this conception of the privilege is without support x x x
To drive the privilege away, there must be ‘something to give colour to the charge;’ there must be
prima facie evidence that it has foundation in fact.” In the petition at bar, however, the PCGG appears
to have relented on its original stance as spelled out in its Complaint that petitioners are co-conspirators
in crimes and cannot invoke the attorney-client privilege. The PCGG has agreed to exclude petitioners
from the Complaint provided they reveal the identity of their client. In fine, PCGG has conceded that
petitioners are entitled to invoke the attorney-client privilege if they reveal their client’s identity.
Assuming then that petitioners can invoke the attorney-client privilege since the PCGG is no longer
proceeding against them as co-conspirators in crimes, we should focus on the more specific issue of
whether the attorney-client privilege includes the right not to divulge the identity of a client as
contended by the petitioners. As a general rule, the attorney-client privilege does not include the right
of non-disclosure of client identity. The general rule, however, admits of well-etched exceptions which
the Sandiganbayan failed to recognize. The general rule and its exceptions are accurately summarized
in In re Grand Jury Investigation,10 viz:
“The federal forum is unanimously in accord with the general rule that the identity of a client is, with
limited exceptions, not within the protective ambit of the attorney-client privilege. See: In re Grand Jury
Proceedings (Pavlick), 680 F.2d 1026, 1027 (5th Cir. 1982) (en banc); In re Grand Jury Proceedings
(Jones), 517 F.2d 666, 670-71 (5th Cir. 1975); In re Grand Jury Proceedings (Fine), 651 F.2d 199, 204
(5th Cir. 1981); Frank v. Tomlinson, 351 F.2d 384 (5th Cir. 1965), cert. denied, 382 U.S. 1028, 86 S.Ct.
648, 15 L.Ed.2d 540 (1966); In re Grand Jury Witness (Salas), 695 F.2d 359, 361 (9th Cir. 1982); In re
Grand Jury Subpoenas Duces Tecum (Marger/-Merenbach), 695 F.2d 363, 365 (9th Cir. 1982); In re
Grand Jury Proceedings (Lawson), 600 F.2d 215, 218 (9th Cir. 1979).
The Circuits have embraced various “exceptions” to the general rule that the identity of a client is not
within the protective ambit of the attorney-client privilege. All such exceptions appear to be firmly
grounded in the Ninth Circuit’s seminal decision in Baird v. Koerner, 279 F.2d 633 (9th Cir. 1960). In
Baird the IRS received a letter from an attorney stating that an enclosed check in the amount of
$12,706 was being tendered for additional amounts due from undisclosed taxpayers. When the IRS
summoned the attorney to ascertain the identity of the delinquent taxpayers the attorney refused
identification asserting the attorney-client privilege. The Ninth Circuit, applying California law, adjudged
that the “exception” to the general rule as pronounced in Ex parte McDonough, 170 Cal. 230, 149 P.
566 (1915) controlled:
‘The name of the client will be considered privileged matter where the circumstances of the case are
such that the name of the client is material only for the purpose of showing an acknowledgment of guilt
on the part of such client of the very offenses on account of which the attorney was employed.’
Baird, supra, 279 F.2d at 633. The identity of the Baird taxpayer was adjudged within this exception to
the general rule. The Ninth Circuit has continued to acknowledge this exception.

‘A significant exception to this principle of non-confidentiality holds that such information may be
privileged when the person invoking the privilege is able to show that a strong possibility exists that
disclosure of the information would implicate the client in the very matter for which legal advice was
sought in the first case.’
In re Grand Jury Subpoenas Duces Tecum (Marger/Merenbach), 695 F.2d 363, 365 (9th Cir. 1982).
Accord: United States v. Hodge and Zweig, 548 F.2d 1347, 1353 (9th Cir. 1977); In re Grand Jury Proceedings
(Lawson), 600 F.2d 215, 218 (9th Cir. 1979); United States v. Sherman, 627 F.2d 189, 190-91 (9th Cir. 1980); In re
Grand Jury Witness (Salas), 695 F.2d 359, 361 (9th Cir. 1982). This exception, which can perhaps be most
succinctly characterized as the “legal advice” exception, has also been recognized by other circuits. See:
In re Walsh, 623 F.2d 489, 495 (7th Cir.), cert. denied, 449 U.S. 994, 101 S.Ct. 531, 66 L.Ed.2d 291
(1980); In re Grand Jury Investigation (Tinari), 631 F.2d 17, 19 (3d Cir. 1980), cert. denied, 449 U.S.
1083, 101 S.Ct. 869-70, 66 L.Ed.2d 808 (1981). Since the legal advice exception is firmly grounded in
the policy of protecting confidential communications, this Court adopts and applies its principles herein.
See: In re Grand Jury Subpoenas Duces Tecum (Marger/Merenbach), supra.
It should be observed, however, that the legal advice exception may be defeated through a prima facie
showing that the legal representation was secured in furtherance of present or intended continuing
illegality, as where the legal representation itself is part of a larger conspiracy. See: In re Grand Jury
Subpoenas Duces Tecum (Mar-ger/Merenbach), supra, 695 F.2d at 365 n. 1; In re Walsh, 623 F.2d
489, 495 (7th Cir.), cert. denied, 449 U.S. 994, 101 S.Ct. 531, 66 L.Ed. 2d 291 (1980): In re Grand Jury
Investigation (Tinari), 631 F.2d 17, 19 (3d Cir. 1980); cert. denied, 449 U.S. 1083, 101 S.Ct. 869, 66
L.Ed. 2d 808 (1981); In re Grand Jury Proceedings (Lawson), 600 F.2d 215, 218 (9th Cir. 1979); United
States v. Friedman, 445 F.2d 1076, 1086 (9th Cir. 1971). See also: Clark v. United States, 289 U.S. 1,
15, 53, S.Ct. 465, 469, 77 L.Ed. 993 (1933); In re Grand Jury Proceedings (Pavlick), 680 F.2d 1026,
1028-29 (5th Cir. 1982) (en banc).
Another exception to the general rule that the identity of a client is not privileged arises where
disclosure of the identity would be tantamount to disclosing an otherwise protected confidential
communication. In Baird, supra, the Ninth Circuit observed:
‘If the identification of the client conveys information which ordinarily would be conceded to be part of
the usual privileged communication between attorney and client, then the privilege should extend to
such identification in the absence of other factors.’
Id., 279 F.2d at 632. Citing Baird, the Fourth Circuit promulgated the following exception:
To the general rule is an exception, firmly embedded as the rule itself. The privilege may be recognized
where so much of the actual communication has already been disclosed that identification of the client
amounts to disclosure of a confidential communication.
NLRB v. Harvey, 349 F.2d 900, 905 (4th Cir. 1965). Accord: United States v. Tratner, 511 F.2d 248, 252 (7th Cir.
1975); Colton v. United States, 306 F.2d 633, 637 (2d Cir. 1962), cert. denied, 371 U.S. 951, 83 S.Ct. 505, 9 L.Ed.2d
499 (1963); Tillotson v. Boughner, 350 F.2d 663, 666 (7th Cir. 1965); United States v. Pape, 144 F.2d 778, 783 (2d
Cir. 1944). See also: Chirac v. Reinecker, 24 U.S. (11 Wheat) 280, 6 L.Ed. 474 (1826). The Seventh Circuit has
added to the Harvey exception the following emphasized caveat:
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The privilege may be recognized where so much of the actual communication has already been
disclosed [not necessarily by the attorney, but by independent sources as well] that identification of the
client [or of fees paid] amounts to disclosure of a confidential communication.
United States vs. Jeffers, 532 F.2d 1101, 1115 (7th Cir. 1976) (emphasis added). The Third Circuit,
applying this exception, has emphasized that it is the link between the client and the communication,
rather than the link between the client and the possibility of potential criminal prosecution, which serves
to bring the client’s identity within the protective ambit of the attorney-client privilege. See: In re Grand
Jury Empanelled February 14, 1978 (Markowitz), 603 F.2d 469, 473 n. 4(3d Cir. 1979). Like the “legal
advice” exception, this exception is also firmly rooted in principles of confidentiality.
Another exception, articulated in the Fifth Circuit’s en banc decision of In re Grand Jury Proceedings
(Pavlick), 680 F.2d 1026 (5th Cir. 1982) (en banc), is recognized when disclosure of the identity of the
client would provide the “last link” of evidence:
We have long recognized the general rule that matters involving the payment of fees and the identity of
clients are not generally privileged. In re Grand Jury Proceedings, (United States v. Jones), 517 F.2d
666 (5th Cir. 1975); see cases collected id. At 670 n. 2. There we also recognized, however, a limited
and narrow exception to the general rule, one that obtains when the disclosure of the client’s identity
by his attorney would have supplied the last link in an existing chain of incriminating evidence likely to
lead to the client’s indictment.’ ”
I join the majority in holding that the Sandiganbayan committed grave abuse of discretion when it
misdelineated the metes and bounds of the attorney-client privilege by failing to recognize the
exceptions discussed above.
Be that as it may, I part ways with the majority when it ruled that petitioners need not prove they fall
within the exceptions to the general rule. I respectfully submit that the attorney-client privilege is not a
magic mantra whose invocation will ipso facto and ipso jure drape he who invokes it with its protection.
Plainly put, it is not enough to assert the privi-lege.11 The person claiming the privilege or its
exceptions has the obligation to present the underlying facts demonstrating the existence of the
privilege.12 When these facts can be presented only by revealing the very information sought to be
protected by the privilege, the procedure is for the lawyer to move for an inspection of the evidence in
an in camera hearing.13 The hearing can even be in camera and ex-parte. Thus, it has been held that
“a well-recognized means for an attorney to demonstrate the existence of an exception to the general
rule, while simultaneously preserving confidentiality of the identity of his client, is to move the court for
an in camera ex-parte hearing.14 Without the proofs adduced in these in camera hearings, the Court
has no factual basis to determine whether petitioners fall within any of the exceptions to the general
rule.
In the case at bar, it cannot be gainsaid that petitioners have not adduced evidence that they fall within
any of the above mentioned exceptions for as aforestated, the Sandiganbayan did not recognize the
exceptions, hence, the order compelling them to reveal the identity of their client. In ruling that
petitioners need not further establish the factual basis of their claim that they fall within the exceptions
to the general rule, the majority held:
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“The circumstances involving the engagement of lawyers in the case at bench therefore clearly reveal may check the records for that one year or several years. The voluntary nature of the payment
that the instant case falls under at least two exceptions to the general rule. First, disclosure of the indicates a belief by the taxpayers that more taxes or interest or penalties are due than the sum
alleged client’s name would lead to establish said client’s connection with the very fact in issue of the previously paid, if any. It indicates a feeling of guilt for nonpayment of taxes, though whether it is
case, which is privileged information, because the privilege, as stated earlier, protects the subject criminal guilt that is undisclosed. But it may well be the link that could form the chain of testimony
matter or the substance (without which there would be no attorney-client relationship). Furthermore, necessary to convict an individual of a federal crime. Certainly the payment and the feeling of guilt are
under the third main exception, revelation of the client’s name would obviously provide the necessary the reasons the attorney here involved was employed—to advise his clients what, under the
link for the prosecution to build its case, where none otherwise exists. It is the link, in the word of circumstances, should be done.”
Baird, “that would inevitably form the chain of testimony necessary to convict the (client) of a . . .
crime.” In fine, the factual basis for the ruling in Baird was properly established by the parties. In the case at
bar, there is no evidence about the subject matter of the consultation made by petitioners’ client.
I respectfully submit that the first and third exceptions relied upon by the majority are not self- Again, the records do not show that the subject matter is criminal in character except for the raw
executory but need factual basis for their successful invocation. The first exception as cited by the allegations in the Complaint. Yet, this is the unstated predicate of the majority ruling that revealing the
majority is “x x x where a strong probability exists that revealing the clients’ name would implicate that identity of the client “x x x would furnish the only link that would form the chain of testimony necessary
client in the very activity for which he sought the lawyer’s advice.” It seems to me evident that “the to convict an individual of a crime.” The silent implication is unflattering and unfair to petitioners who
very activity for which he sought the lawyer’s advice” is a question of fact which must first be are marquee names in the legal profession and unjust to their undisclosed client.
established before there can be any ruling that the exception can be invoked. The majority cites Ex
Parte Enzor,15 and US v. Hodge and Zweig,16 but these cases leave no doubt that the “very activity” Finally, it ought to be obvious that petitioners’ right to claim the attorney-client privilege is resolutory of
for which the client sought the advice of counsel was properly proved. In both cases, the “very activity” the Complaint against them, and hence should be decided ahead and independently of their claim to
of the clients reveal they sought advice on their criminal activities. Thus, in Enzor, the majority opinion equal protection of the law. Pursuant to the rule in legal hermeneutics that courts should not decide
states that the “unidentified client, an election official, informed his attorney in confidence that he had constitutional issues unless unavoidable, I also respectfully submit that there is no immediate necessity
been offered a bribe to violate election laws or that he had accepted a bribe to that end.”17 In Hodge, to resolve petitioners’ claim to equal protection of the law at this stage of the proceedings.
the “very activity” of the clients deals with illegal importation of drugs. In the case at bar, there is no IN VIEW WHEREOF, I respectfully register a qualified dissent from the majority opinion.
inkling whatsoever about the “very activity” for which the clients of petitioners sought their professional
advice as lawyers. There is nothing in the records that petitioners were consulted on the “criminal Resolutions annulled and set aside.
activities” of their client. The complaint did al-lege that petitioners and their client conspired to commit
crimes but allegations are not evidence. Note.—As an officer of the court, a lawyer has the sworn duty to assist in, not to impede or pervert, the
administration of justice. (Cordova vs. Labayen, 249 SCRA 172 [1995]) Regala vs. Sandiganbayan, First
So it is with the third exception which as related by the majority is “where the government’s lawyers Division, 262 SCRA 122, G.R. No. 105938, G.R. No. 108113 September 20, 1996
have no case against an attorney’s client unless, by revealing the client’s name, the said name would
furnish the only link that would form the chain of testimony necessary to convict an individual of a
crime.”18 Again, the rhetorical questions that answer themselves are: (1) how can we determine that
PCGG has “no case” against petitioners without presentation of evidence? and (2) how can we
determine that the name of the client is the only link without presentation of evidence as to the other
links? The case of Baird vs. Koerner19 does not support the “no need for evidence” ruling of the
majority. In Baird, as related by the majority itself, “a lawyer was consulted by the accountants and the
lawyer of certain undisclosed taxpayers regarding steps to be taken to place the undisclosed taxpayers
in a favorable position in case criminal charges were brought against them by the US Internal Revenue
Service (IRS). It appeared that the taxpayer’s returns of previous years were probably incorrect and the
taxes understated.20 Once more, it is clear that the Baird court was informed of the activity of the
client for which the lawyer was consulted and the activity involved probable violation of tax laws. Thus,
the Court held:

“The facts of the instant case bring it squarely within that exception to the general rule. Here money
was received by the government, paid by persons who thereby admitted they had not paid a sufficient
amount in income taxes some one or more years in the past. The names of the clients are useful to the
government for but one purpose—to ascertain which taxpayers think they were delinquent, so that it