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LEGAL ETHICS NO.

7 CANONS 16-22 1

[G.R. No. 109493. July 2, 1999] lapses were attributable to the Court of Appeals and their former counsel, they should still be accorded
SPOUSES SERAFIN AQUINO and RUMELIA AQUINO, petitioners, vs. COURT OF their right to appeal. Finally, they claim that on the merits, there are compelling grounds to allow the
APPEALS, GOVERNMENT SERVICE INSURANCE SYSTEM, ET. AL., respondents. appeal.[11]
RESOLUTION The respondents, on the other hand, argue that Atty. Barican did not make a formal withdrawal as counsel
GONZAGA-REYES, J.: of record of the petitioners. It is true that Atty. Mala assisted the petitioners in filing their notice of appeal
This is a Petition for Review on Certiorari under Rule 45 of the Rules of Court from the Resolution[1] of the but said notice was signed by Serafin Aquino himself. Moreover, Atty. Mala never entered his appearance
Court of Appeals dated July 25, 1991, which dismissed the appeal of herein petitioners. It appears that Civil as their counsel. In addition, the Motion for the Issuance of a Writ of Preliminary Injunction[12] filed by the
Case No. 38-M-89 filed by herein petitioners against the Government Service Insurance System (GSIS) for petitioners was signed by the petitioner spouses and only notarized by Atty. Mala. If it was intended that
specific performance, damages and annulment with prayer for preliminary injunction with the Regional Trial he should be their counsel of record, he should have signed the motion.The respondents also claim that
Court of Malolos, Bulacan, Branch 12 was dismissed on March 27, 1989 on the ground that the complaint this petition is already res judicata as their appeal was dismissed and the decision became final and
failed to state a cause of action against the GSIS.[2] executory; an entry of judgment was issued and the case was remanded to the lower court for
execution. Finally, the respondents maintain that the petitioners are guilty of forum shopping and
The petitioners filed a notice of appeal[3] with the RTC. Their appeal was dismissed on July 25, 1991 for
contemptuous behavior as shown by the different cases filed by the petitioner against them.
failure to file an appellants brief within the reglementary period which expired on May 29, 1991 pursuant
to Section 1 (f), Rule 50 of the Rules of Court.[4] In reply[13], the petitioners reiterate that there was a failure of service of a copy of the resolution of the
Court of Appeals in CA G.R. CV No. 21553 dated July 25, 1991 dismissing their appeal since it never reached
On September 1, 1992, the Court of Appeals[5] denied the motion of herein petitioners to recall Entry of
their lawyer, Atty. Mala, who died on June 3, 1991; and that Atty. Barican was no longer their counsel of
Judgment and to reinstate appeal etc., there being no showing therein of any reason to justify the failure
record[14]. They also claim that CA-G.R. No. 21533 is not res judicata to G.R. No. 109493 since:
of appellants counsel to file appellants brief within the reglementary period and considering that the
1. There was no judgment on the merits in CA-G.R. No. 21533 since it was dismissed on a mere
resolution dated July 25, 1991 dismissing the appeal became final xxx[6]. On March 15, 1993, the Court of
technicality.
Appeals[7] denied the petitioners motion for reconsideration of its September 1, 1992 Resolution on the
2. There is no identity of subject matter since CA-G.R. No. 21533 sought a review of the decision
ground that it was beyond the power of the Court to modify the dismissal since the order dismissing the
of the RTC-Malolos while G.R. No. 109493 seeks a review of the dismissal of their appeal by
appeal had become final and executory on August 19, 1991 and Entry of Judgment was issued on November
the Court of Appeals.
4, 1991.[8]
Petitioners also claim that they are not guilty of forum shopping since there was no pending action when
Hence, this petition where the petitioners assign the following errors:
the second and subsequent cases were filed; and that it was the GSIS who initiated one of the cases, Civil
I. IT WAS ERROR FOR THE COURT OF APPEALS NOT TO HAVE SERVED A COPY OF ITS
Case No. 301 for unlawful detainer; and that the cases they filed involve different subject matters, which
RESOLUTION OF DISMISSAL UPON THE APPELLANT DESPITE KNOWLEDGE THAT THEIR
negates a finding of forum shopping.[15] In their rejoinder[16], respondents assert that Atty. Baricans
FORMER COUNSEL OF RECORD HAD DIED.
withdrawal was never approved by the Court despite his certification that he withdrew as counsel for
II. IT WAS ERROR FOR THE COURT OF APPEALS TO SERVE COPIES OF RESOLUTIONS UPON
petitioners.
THE APPELLANTS FORMER COUNSEL DE PARTE.
III. IT WAS ERROR FOR THE COURT OF APPEALS TO DENY APPELLANTS MOTION FOR We rule that there was a proper service of the Resolution of the Court of Appeals in CA G.R. CV No. 21553
RECONSIDERATION ON THESE GROUNDS. dated July 25, 1991 on the petitioners.
IV. IT WAS ERROR FOR THE COURT OF APPEALS TO DENY ADMISSION OF THE BRIEF FOR
THE APPELLANT WHICH WAS ALREADY APPENDED TO THEIR MOTION FOR Section 26, Rule 138 of the Rules of Court states the proper procedure for the withdrawal of a lawyer as
RECONSIDERATION. counsel in a case. It provides:
V. THERE ARE COMPELLING REASONS AS ENUMERATED IN THE APPELLANTS BRIEF FOR THE Section 26 - Change of Attorneys - An attorney may retire at anytime from an action or
COURT OF APPEALS TO RESOLVE THE ISSUES ON THE MERITS.[9] special proceeding, by the written consent of his client filed in court. He may also retire at
anytime from an action or special proceeding, without the consent of his client, should the court,
The petitioners argue that they were never notified by their counsel of record, Atty. Mala, of the notice to on notice to the client and attorney, and on hearing, determine that he ought to be allowed to
file an appellants brief. Atty. Mala was incapacitated to notify the petitioners of their obligation as he was retire. In case of substitution, the name of the attorney newly employed shall be entered on the
in a coma when said notice was served upon him. They argue that when the Court of Appeals was notified docket of the court in place of the former one, and the written notice of the change shall be
of the death of Atty. Mala when it received the return of the assailed Resolution of July 25, 1991[10] bearing given to the adverse party xxx.
the notation RETURN TO SENDER, REASON: Deceased 8-1-81, it should have sent resolutions, notices and
other processes to the petitioners themselves for the reason that when the case was brought to the Court Unless the procedure prescribed in the above mentioned section is complied with, the attorney of record is
of Appeals, they had no counsel of record and were filing and signing the pleadings themselves. They add regarded as the counsel who should be served with copies of the judgments, orders and pleadings and who
that although Atty. Rosalino Barican continued to be served with copies of resolutions, etc., Atty. Barican should be held responsible for the case.[17] Cortez vs. Court of Appeals, 83 SCRA 31 at p. 35 [1978].17 In
withdrew as their counsel of record while the case was still pending before the RTC of Malolos, Bulacan. The cases of substitution of attorneys the following requisites must be complied with:
petitioners also argue that substantial justice demands that they be allowed to continue their appeal for the 1. Written application for substitution;
reason that as soon as they learned of the dismissal of their appeal, they immediately procured the services 2. written consent of the client; and
of new counsel who filed an appeal brief together with a motion for reconsideration. As the procedural 3. a written consent of the attorney to be substituted.
LEGAL ETHICS NO. 7 CANONS 16-22 2

In case the consent of the attorney to be substituted cannot be obtained, there must at least be proof that [A.C. No. 5019. April 6, 2000]
notice of the motion for substitution has been served upon him in the manner prescribed by our rules.[18] Judge ADORACION G. ANGELES, complainant, vs. Atty. THOMAS C. UY JR., respondent.
In the present case, petitioners admit that Atty. Barican represented them in the proceedings before the DECISION
lower court but that Atty. Mala substituted Atty. Barican when the case was elevated to the Court of PANGANIBAN, J.:
Appeals.[19] No proof was presented by the petitioners to show compliance with the above procedural Lawyers must promptly account for money or property they receive on behalf of their clients. Failure to
requirements for the withdrawal of Atty. Barican and the substitution of Atty. Mala in his stead; no written do so constitutes professional Misconduct and justifies the imposition of disciplinary sanctions.
application for substitution or written consent of the client was filed in court. The Certification made by
The Case and the Facts
Atty. Rosalino C. Barican to the effect that he was the former counsel of record of the petitioners but that
In a letter dated February 11, 1999 addressed to the Office of the Chief Justice, Judge Adoracion G.
he withdrew as their counsel is not controlling in the absence of compliance with the above procedural
Angeles of the Regional Trial Court of Caloocan City (Branch 121) charged Atty. Thomas C. Uy Jr. with
requirements. It is therefore irrelevant that Atty. Mala did not receive the copy of the resolution of the Court
violation of Canon 16 of the Code of Professional Responsibility. Complainant states that respondent's
of Appeals dated July 25, 1991 which dismissed their appeal since he was not the counsel of record and
acts, which had earlier been held contemptible in her February 10, 1999 Order,[1] also rendered him
had never entered his appearance as counsel of the petitioners.
administratively liable. In the said Order, she narrated the following facts:
Accordingly, the resolution of the Court of Appeals in CA G.R. CV No. 21533 dated July 25, 1991, dismissing
"When the case was called for the second time at 11 :25 o'clock in the morning, the private prosecutor
the petitioners appeal became final and executory because their lawyer of record, Atty. Barican, was duly
Atty. Thomas C. Uy, Jr. appeared. In open court, accused Norma Trajano manifested that she had already
served with a copy of that resolution. There was an effective service upon the petitioners for as far as the
settled in full the civil aspect in Crim. Case No. C-54177 (98) in the total amount of [t]hirty [s]ix [t]housand
Court of Appeals was concerned, Atty. Barican continued to be their counsel of record. The failure of an
[f]ive [h]undred (P36,500.00) [p]esos. She further alleged that she paid P20,000.00 directly to the private
appellant to file an appellants brief is ground for the dismissal of the appeal.[20]The dismissal becomes final
complainant and the balance of P16,500.00 was delivered to Atty. Thomas C. Uy, Jr., the lawyer of the
and executory after fifteen days from receipt of the judgment or order. In the present case, since it is not
private complainant and accordingly produced in open court the receipt for such payment signed by no less
denied that Atty. Barican, the counsel of record, received the copy of the resolution of the Court of Appeals
than the aforesaid lawyer.
dismissing the petitioners appeal, the dismissal became final and executory after the lapse of fifteen days.
Indeed, the civil liability of the accused had already been satisfied in full. Miso
We agree with the petitioners that they are not guilty of forum shopping. There is forum shopping
"However, the private complainant, Primitiva Malansing [Del Rosario] manifested that she did not receive
whenever, as a result of an adverse opinion in one forum, a party seeks a favorable opinion (other than by
the amount of [s]ixteen [t]housand [f]ive [h]undred (P16,500.00) [p]esos which was paid to his lawyer
appeal or certiorari) in another.[21] The rule on forum shopping applies only when two (or more) cases are
Atty. Thomas C. Uy, Jr., thereby constraining this court to direct Atty. Thomas C. Uy to turn over the
still pending.[22] There is only one case, G.R. No. 109493, the present Petition for Review on Certiorari,
money to the private complainant which he received in trust for his client. Atty. Uy however argued that
pending between the parties in the present case.
his client did not like to accept the money but the assertion of the lawyer was belied by his own client,
In view of the above conclusions, we deem it unnecessary to discuss the issue of res judicata. the herein private complainant, who manifested in open court x x x her willingness to accept the money.
The Court again directed Atty. Uy to produce the money but the latter argued that he kept it in his office.
IN VIEW OF THE FOREGOING, the instant Petition is hereby DENIED. No pronouncement as to costs.
Consequently, the Court suspended the proceedings to enable Atty. Uy to get the money from his law
SO ORDERED.
office which is located only at the second floor of the same building where this court is located.
"Unfortunately, it is already 12: 15 o'clock past noon but Atty. Uy did not show up anymore and not even
his shadow appeared in Court.
"It cannot be denied that the act of Atty. Thomas Uy in deliberately failing to return to the Court [the]
proceedings [of which] were suspended just because of his representations, mirrors not only an
undisguised disobedience of a court order but also manifests his propensity to mock the dignity of the
Court. Disgustingly, he deliberately ignored his solemn oath to conduct himself as befitting the status of
an officer of the court.
"Indeed, this gross misbehavior of Atty. Uy cannot simply be ignored for it is a raw challenge to the
authority of the Court.
"It must also be pointedly emphasized that Atty. Thomas Uy committed a brazen violation of the
provisions of Canon 16 of the Code of Professional Responsibility, to wit: Nex old
"x x x x x x x x x
"Obviously, Atty. Thomas Uy fell short of the duties expected from him as a member of the bar."
In compliance with this Court's March 24, 1999 Resolution, Respondent Uy[2] filed his Comment on June
7, 1999. Denying that he violated Canon 16 of the Code of Professional Responsibility, he explained:
"1). In a criminal case, then pending before the Regional Trial Court, Branch 121 of Kalookan
City, Metro Manila, presided by the complainant Honorable Adoracion G. Angeles, entitled
LEGAL ETHICS NO. 7 CANONS 16-22 3

'People of the Philippines vs. Norma Trajano, et., al', Criminal Case No. C-54176-77 (98), Atty. kept at the office of the [r]espondent so that future payments of Norma Trajano will be save[d]
Thomas C. Uy Jr., herein referred to as [r]espondent, was engaged as [p]rivate [p]rosecutor of in whole and for them to avoid spending the same as what had happened to the past installment
the complainant therein, Mrs. Primitiva Malansin Del Rosario. At the outset Norma Trajano, payments of Norma Trajano. Respondent then acceded to the request of Primitiva Del Rosario
accused in said criminal case, expressed her desire and offered to settle the civil aspect of the and her daughter and told them that they can get the money anytime they want from the
criminal case against her to which Primitiva Del Rosario acceded. On separate hearings, Norma [r]espondent's office. Hence, the money was kept locked [in] the filing cabinet of the
Trajano made installment payments to Primitiva Del Rosario some of which payments were duly [r]espondent where he used to keep all his personal file[s]. Manikan
acknowledged by the latter in the presence of [r]espondent;
"5). On December 23, 1998, early before noon, Primitiva Del Rosario and her daughter Aurora
"2). On a previously cancelled date of hearing of the aforesaid criminal case x x x on December Del Rosario, on a prior invitation, attended the Christmas Party of the office of [r]espondent and
14, 1998, Norma Trajano went to the office of the [r]espondent at about 8:45 o'clock in the undersigned counsel. x x x Respondent, after the x x x lunch, instructed Mr. Romeo Jamisola Jr.,
morning, x x x and met Mr. Romeo C. Jamisola Jr., who is acting as [r]espondent's personal to give the sum of money (P16,500.00) and for Primitiva Del Rosario to receive the same for fear
secretary and at the same time the liason officer of the law firm De Veyra, Uy and Associates x x of a repetition of a burglary incident before, where some cash and minor office appliances of
x. Mr[.] Romeo Jamisola Jr., is the lone staff of the law firm x x x. Respondent was at that time undersigned were lost. Primitiva Del Rosario, however, insisted that said sum of money be kept
not in the office as he was attending a hearing before the Regional Trial Court, Branch 122, at the office of the [r]espondent to save in whole the installment payments of Norma Trajano
Kalookan City, Metro Manila. x x xMani kx and that [was] the wish of her son Fernando 'Bong' Del Rosario, who is a long time friend and a
compadre of the [r]espondent. Respondent, respecting the trust reposed upon him by Primitiva
"3). On the aforesaid date and time (December 14, 1998) at the office of the [r]espondent,
Del Rosario, her daughter Aurora Del Rosario, and son Fernando Del Rosario, acceded to hold in
Norma Trajano told Mr. Romeo Jamisola Jr. that she will make another partial payment to
trust the said sum of [s]ixteen [t]housand [f]ive [h]undred (P16,500.00) [p]esos, Philippine
Primitiva M. Del Rosario because she cannot attend the hearing the following day (8[:]30 o'clock
[c]urrency, which [was] locked and safely kept [in] the filing cabinet of the [r]espondent until
a.m. of December 15, 1999) before Judge Adoracion G. Angeles due to a conflict of schedule
February 12, 1999; x x x;
with her [other] case in the Regional Trial Court, Branch 19, Malolos, Bulacan, where she is
likewise the accused for [e]stafa[.] Mr. Romeo Jamisola told Norma Trajano to wait for a while "6). On February 10, 1999 [during] the hearing of the Norma Trajano case before the Hon.
as he will fetch [r]espondent at the ground floor in the sala of the Honorable Remigio E. Zari. Adoracion G. Angeles, [r]espondent appeared shortly before 10:30 o'clock in the morning,
Respondent, upon being informed of the presence of Norma Trajano in the office of the pursuant to a 'Motion to Call Case at 10:30 o'clock in the Morning x x x.
[r]espondent by Romeo Jamisola Jr. went to his office and Norma Trajano immediately told
"7). When the said Norma Trajano [case] x x x was called on second call at 11[:]25 a.m., [i]n
[r]espondent that she knew that the setting for that day (December 14, 1998) was previously
said February 10, 1999 hearing, respondent was first scolded by the Honorable Court (Judge
cancelled and that she cannot attend the hearing the following day (8[:]30 o'clock a.m.
Adoracion G. Angeles) x x x [for] giving more preference to the Metropolitan Trial Court than her
December 15, 1998) and further told the [r]espondent that she (Norma Trajano) will make
Court. Resp[o]ndent, however, beg[ged the] indulgence of the Honorable Court (Judge
another partial payment to Primitiva M. Del Rosario and that she will just leave her payment in
Adoracion G. Angeles) and explained why [he] first attend[ed] the Mandaluyong hearing of
the sum of [s]ixteen [t]housand [five hundred] [p]esos (P16,500.00), Philippine [c]urrency, in
Manny Chua's case, to wit; x x x. Oldmis o
the office of the [r]espondent. Respondent then told Norma Trajano to inform Primitiva M. Del
Rosario first but Norma Trajano replied that she will just call Primitiva [Del Rosario]. "8). That it was during the course of [the] litany of sermon, [i]n that hour, made by the
Nonetheless, [r]espondent told Romeo Jamisola Jr. to call Primitiva Del Rosario, using the office Honorable Court addressed to the [r]espondent that Norma Trajano x x x butted in and informed
phone, and let her talk with Norma Trajano, and, if Primitiva Del Rosario agreed [r]espondent the Honorable Court (Judge Adoracion G. Angeles) that she will be tendering another partial
instructed Romeo Jamisola Jr., to just prepare a receipt. Respondent, fearing that his case payment; it was at that moment that Judge Adoracion G. Angeles asked Norma Trajano how
(People vs. Rommel Senadrin et al. above-stated) might have been called in the calendar, much had she paid Primitiva Del Rosario, and, Norma [T]rajano answered that she had already
immediately left the office and proceeded [at] the sala of the Honorable Remigio E. Zari. paid P36,500.00 as full payment for one case, and that of the P36,500, P20,000.00 was paid to
Respondent, after the hearing x x x, returned to his office and upon learning that his signature Primitiva Del Rosario and HESITANTLY said that the P16,500 was paid to the [r]espondent.
was affixed by Romeo Jamisola Jr. upon the insistence of Norma Trajano scolded Romeo Judge Angeles then took the receipt from Norma Trajano and had it xeroxed by a personnel of
Jamisola Jr. and for his unsuccessful attempt to contact first Primitiva Del Rosario before the Court. The carbon duplicate original of the Receipt, dated [D]ecember 14, 1998, showing the
receiving the sum of money left by Norma Trajano; Maniks receipt by the office of the [r]espondent, through Romeo Jamisola Jr., whose printed [name]
was pre[ceded] by the word 'By', indicating that he received the sum of money on behalf of or in
"4). The following day [o]n the morning of December 15, 1998 [r]espondent arrived at his office
representation of the [r]espondent, is hereto [attached] and marked as ANNEX '5', to form part
and met Primitiva Del Rosario and her daughter Aurora Del Rosario and immediately the trio
hereof;
appeared before the sala of Judge Adoracion G. Angeles in the hearing of the Norma Trajano
case. Returning [to] the office of the [r]espondent after the hearing, Primitiva Del Rosario and "9). That it was perhaps due to the belief [in] and the immediate impression of Judge Adoracion
Aurora Del Rosario, being earlier informed that on December 14, 1998 Norma Trajano went [to] G. Angeles [of the] answer of Norma Traiano that prompted Judge Angeles to ask,
his office and made partial payment in the sum of P16,500 thru Mr. Romeo Jamisola Jr., the instantaneously in a loud manner, Primitiva Del Rosario IN TAGALOG', the question,
[r]espondent told Mr. Romeo Jamisola to get the money from the filing cabinet and while the 'NATANGGAP MO BA KAY ATTY. UY ANG PERA NA P16,500.00?'. Primitiva Del Rosario, a
money in the envelope [was] being handed over to Primitiva Del Rosario, [the latter] and her seventy-year-old, who was shocked by the tone and the manner she was asked by Judge
daughter x x x, however, told [r]espondent to just let the money in the sum of P16,500.00 be Angeles simply just answered 'HINDI PO, KASI GUSTO [KO] PO NA MABUO ANG PERA'. Primitiva
LEGAL ETHICS NO. 7 CANONS 16-22 4

Del Rosario, however, tried to explain her answer 'HINDI PO' and why she did not yet [receive] the premises of the sala of Judge Angeles alone at about 4:00 o'clock P .M. after his meeting
the money from the [r]espondent by raising her hand but was prevented by Judge Adoracion G. with the squatter families. But again, his request to 'Armand' to talk with Judge Angeles, after
Angeles from further answering by telling Primitiva Del Rosario to stop. With that answer of the media interview, was denied. At about 5:30 o'clock in the afternoon, 'Armand', the court
Primitiva Del Rosario, [r]espondent butted in to explain Primitiva Del Rosario's answer of 'HINDI personnel, served the Order, of said date, February 10, 1999 at the office of the [r]espondent;
PO' and her having not yet received the sum of money, subject of the inquisition of Judge
"13). In the early afternoon of the following day, February 11, 1999, [r]espondent together with
Angeles by manifesting to wit; x x x that Primitiva Del Rosario did not get the money when x x x
Primitiva Del Rosario and her daughter Aurora Del Rosario went again [to] the sala of Judge
handed the same on December 15, 1998 because she wanted [it] to be save[d] in whole
Angeles x x x to seek an audience with Judge Angeles. Their request x x x w[as] likewise in vain.
together with the future installment payments of Norma Trajano and to be kept in the office of
Primitiva Del Rosario, after the last attempt to seek audience with Judge Angeles and already
the [r]espondent as wished by her son Bong Del Rosario; and, that the said sum of money [was]
tired of going [to] and [from] the sala of Judge Angeles, decided on February 12, 1999, to
kept in the filing cabinet in the office of the [r]espondent. All explanation[s] of the [r]espondent
receive the sum of money in the amount of P16,500.00 from the office of the [r]espondent,
went to x x x naught as the [r]espondent was cut short by x x x Judge Angeles, [who] in a loud
through, Romeo Jamisola Jr. and executed a Sinumpaang Salaysay. x x x;
and angry voice orally directed the [r]espondent to get the money from [r]espondent's office
and give the same to Primitiva Del Rosario. It was already 11 :45 o'clock in the morning, more "14). The Sinumpaang Salaysay of Primitiva Del Rosario, dated February 16, 1999 as well as the
or less, an the [r]espondent was given fifteen (15) minutes to comply; [r]espondent requested Acknowledgment Receipt, dated February 12, 199[9] was attached to a Manifestation caused to
Judge Angeles to be accompanied by Primitiva Del Rosario and her daughter Aurora Del Rosario be filed by the [r]espondent on March 3, 1999 when the respondent was confined in Fatima
but both were ordered to stay in court by Judge Angeles; Ncm Hospital in Valenzuela City, Metro Manila on March 2, 1999; Scnc m
"10). Respondent in compliance with the oral order of Judge Angeles immediately proceeded [to] "15). Learning of the instant administrative case against the [r]espondent, Bong Del Rosario, the
his office but only to find out that Romeo Jamisola Jr., who [held] the only key [to r]esponddnt's son of Primitiva Del Rosario, upon whose wish the subject sum of money was kept at the office
filing cabinet, was on errand x x x that morning of February 10, 1999 [for] Atty. Angel B. De of the [r]espondent to save the same in whole as well as the future in[s]tallment payments of
Veyra (the Undersigned Counsel) [who had sent him] to the offices of the solicitor general in Norma Trajano executed a Sinumpaang Salaysay, attesting [to] and confirming the statement of
Makati City, and, the City Prosecutor's Office of Manila to [furnish copies to] both offices; x x x; [his] mother Primitiva Del Rosario. x x x"[3]
"11). Respondent, expecting that Romeo Jamisola Jr. would [arrive] before 12[:]00 noon, x x x Stripped of unnecessary verbiage, the Comment contends that the respondent kept the money in his
waited for Romeo Jamisola Jr. while at the same time called up [his] wife to immediately [come] office because that was the alleged wish of both his client and her son. He allegedly informed them of
to his office to spare the sum of P16,500.00 as Romeo Ja[mi]sola may not [arrive] [within] the such money and tried to give it to them, but they insisted that he retain it. He further maintained that it
time allotted by Judge Angeles. The wife of respondent, however, arrived at about 12:25 P .M., was only after Judge Angeles issue the February 10, 1999 Order that his client relented and accepted the
more or less, ahead of Romeo Jamisola Jr. and spared [r]espondent the sum of P16,500.00 and money on February 12, 1999. After the judge filed her Reply on June 30, 1999, this Court referred the
[r]espondent immediately went [to] the fourth floor, where the sala of Judge Angeles [was] case to the Office of the Bar Confidant for report and recommendation. The Court dispensed with the
located but unfortunately the session was already adjourned. Respondent then talked to normal referral to the Integrated Bar of the Philippines because the records were complete and the
'Armand', one 'of the court personnel and is known as the door keeper of the chamber of Judge question raised was simple. No further factual investigation was necessary in the premises.
Angeles, and [requested that he be allowed to go inside the chamber to show [his] compliance,
though late. Respondent, however, was told by 'Armand' that Judge Angeles was on her lunch Bar Confidant's Report and Recommendation
break an that it [was] better for [r]espondent to take his lunch too and return a little Recommending that Atty. Thomas C. Uy Jr .be suspended from the practice of law for one month, the
later; Ncmmis Office of the Bar Confidant in its Report and Recommendation dated December 15, 1999 said: Sdaa miso
"x x x [I]t is clear that it is the sworn duty of a member of the bar to be accountable, at all times,
"12). At about 1:30 o'clock in the afternoon of that day (February 10, 1999) [r]espondent for anything which he receives for and in behalf of his client.
returned [to] the sala of Judge Angeles together with Primitiva Del Rosario and her daughter "In the case at bar, this Office is more inclined to believe the story of the complainant.
Aurora Del Rosario, who likewise returned to the court, to seek an audience in [the] chamber "First, it cannot be disputed that the transcript of stenographic notes is the most reliable record of
[of] Judge Angeles. Said audience with Judge Angeles was desired by Primitiva Del Rosario to let what indeed transpired (and what words were uttered by the parties involved) on February 10,
Judge Angeles [witness] the giving of the money to Primitiva Del Rosario. But request[s] for the 1999 at the hearing of Crim. Case No. C-54176-77 (98). Records clearly show that the private
same, through 'Armand', were twice denied by Judge Angeles because at that time Judge complainant in the criminal case, when asked by Judge Angeles as to the whereabouts of the
Angeles was being interviewed by several media personnel of some TV stations. The Del P16,500.00, spontaneously replied that she had no knowledge of the same; in effect saying that
[Rosarios], however, left earlier upon knowing that Judge Angeles denied their request for an Atty. Uy has not given her the subject 16,500.00. If, indeed, Primitiva Del Rosario requested Atty.
audience. [They] told [r]espondent that they will be back the following day. It was only when Uy to keep the money as far back as December 1998, then she should have told the same to
Romeo Jamisola arrived at about 3:00 o'clock, more or less, in the afternoon and went at the Judge Angeles.
fourth floor at the premises of the sala of Judge Angeles and informed the [r]espondent that he "Atty. Uy's allegation that Judge Angeles prevented Primitiva Del Rosario from saying in open court
carried with him the key to [r]espondent's cabinet and the presence of some [squatter] families the words 'HINDI PO KASI GUSTO KO PO NA MABUO ANG PERA' does not have any proof as
of Batasan Hills, Quezon City at the office of the [r]espondent, who has an appointment with the nothing of that sort appears in the transcript of stenographic notes. Atty. Uy has not even
[r]espondent, that the [r]espondent left the premises of the sala of Judge Angeles. [sic] bothered to refute the truth of the contents of the stenographic notes, all the more bolstering this
Respondent, at his office ordered Romeo Jamisola Jr. to open the filing cabinet and returned to Office's opinion that the said notes are accurate and truthful. Sdaad
LEGAL ETHICS NO. 7 CANONS 16-22 5

"Second, the affidavits executed by Primitiva Del Rosario and her son, Fernando Del Rosario, dated Mrs. Del Rosario: Hindi po, sila po ang nagbigayan. Juris
February 16, 1999 and June 7, 1999, respectively, attesting to Atty. Uy's averment that his act of Court: Hindi po ibinibigay sa inyo ni Atty. Uy?
personally keeping the subject P16,500.00 was with and at their request cannot be given much Mrs. Del Rosario: Hindi po.
credence to outweigh the arguments of Judge Angeles. The said affidavits, both executed after xxxxxxxxx
February 10, 1999, are suspect. Caught by surprise when Judge Angeles inquired of the Court: Nasaan iyong P16,500? Huwag kayong matakot.
whereabouts of his client's money, Atty. Uy x x x resorted to seeking the help of his client to Mrs. Del Rosario: Aywan ko po sa kanilang dalawa."[8]
corroborate his defense. Being the clients of Atty. Uy, Primitiva Del Rosario and her son could have
If it were true that Mrs. Del Rosario was informed about the payment and that she entrusted it to
been persuaded to help extricate their counsel from the latter's predicament.
respondent, she would have known its whereabouts. That she did not know it showed the falsity of his
"In the absence of any contradicting evidence to dispute the allegation that Atty. Uy failed to
claim.
immediately remit to his client the money due the latter, it is safe to conclude that Atty. Uy has
violated his sworn duty to uphold, at all times, the trust and confidence reposed in him by his It is noteworthy that respondent did not dispute the foregoing transcript although it belied his allegation
client(s). that Mrs. Del Rosario's express wish was to have the payments in full. Neither are we convinced by the
xxxxxxxxx affidavits of Mrs. Del Rosario and her son, both of whom affirmed their intention to have their money in
"In the instant case, Atty. Uy, upon receipt of the P16,500.00 from the accused in the criminal the safekeeping of respondent. It should be stressed that he was her counsel and the compadre of her
case, should have promptly remitted the same to his client, Primitiva Del Rosario. Had Judge son. Moreover, the affidavits were executed after the filing of this Complaint. As the Office of the Bar
Angeles not inquired of the whereabouts of the money, the same would have remained with Atty. Confidant observed, these considerations militate against the credibility of the affiants. In any event, their
Uy, to the prejudice of the latter's client."[4] affidavits fail to explain adequately why Mrs. Del Rosario, during the hearing on February 10, 1999, did
not know where her money was.
This Court's Ruling
We agree with the findings and the recommendation of the Office of the Bar Confidant. Scs daad The records do not clearly show whether Attorney Uy had in fact appropriated the said amount; in fact,
Mrs, Del Rosario acknowledge that she had received it on February 12, 1999. They do show, however,
Administrative Liability of Respondent
that respondent failed to promptly report that amount to her. This is clearly a violation of his professional
The relationship between a lawyer and a client is highly fiduciary; it requires a high degree of fidelity and
responsibility. Indeed, in Aya v. Bigornia,[9] the Court ruled that money collected by a lawyer in favor of
good faith. It is designed "to remove all such temptation and to prevent everything of that kind from
his clients must be immediately turned over to them. In Daroy v. Legaspi,[10] the Court held that "lawyers
being done for the protection of the client."[5]
are bound to promptly account for money or property received by them on behalf of their clients and
Thus, Canon 16 of the Code of Professional Responsibility provides that "a lawyer shall hold in trust all failure to do so constitutes professional misconduct."
moneys and properties of his client that may come into his possession." Furthermore, Rule 16.01 of the
Verily, the question is not necessarily whether the rights of the clients have been prejudiced, but whether
Code also states that "a lawyer shall account for all money or property collected or received for or from
the lawyer has adhered to the ethical standards of the bar.[11] In this case, respondent has not done so.
the client." The Canons of Professional Ethics is even more explicit:
Indeed, we agree with the following observation of the Office of the Bar Confidant:
"The lawyer should refrain from any action whereby for his personal benefit or gain he abuses or
takes advantage of the confidence reposed in him by his client. Sup rema "Keeping the money in his possession without his client's knowledge only provided Atty. Uy the
"Money of the client collected for the client or other trust property coming into the possession of tempting opportunity to appropriate for himself the money belonging to his client. This situation
the lawyer should be reported and accounted for promptly and should not under any should, at all times, be avoided by members of the bar. Like judges, lawyers must not only be
circumstances be commingled with his own or be used by him."[6] clean; they must also appear clean. This way, the people's faith in the justice system would
remain undisturbed."[12]J
In the present case, it is clear that respondent failed to promptly report and account for the P16,500 he
had received from Norma Trajano on behalf of his client, Primitiva Del Rosario. Although the amount had In this light, the Court must stress that it has the duty to look into dealings between attorneys and their
been entrusted to respondent on December 14, 1998, his client revealed during the February 10, 1999 clients and to guard the latter from any undue consequences resulting from a situation in which they may
hearing that she had not yet received it. Worse, she did not even know where it was. stand unequal.[13] The present situation calls for the exercise of this duty. For misappropriating and failing
Respondent maintains that on December 15, 1998 he informed Mrs. Del Rosario about the payment. He to promptly report and deliver money they received on behalf of their clients, some lawyers have been
further avers that he kept the money up n her instruction, as she had allegedly wanted "future payments disbarred[14] and others have been suspended for six months.[15] In the present case, the records merely
x x [to] be saved in whole and for them to avoid spending the same as what had happened to the past show that respondent did not promptly report that he received money on behalf of his client. There is no
installment payments x x x."[7] This assertion allegedly finds support in her answer to the question of clear evidence of misappropriation. Under the circumstances, we rule that he should be suspended for
Judge Angeles, who had asked her whether she had received the disputed payment: "Hindi po, kasi gusto one month.
[ko] po na mabuo ang pera."
WHEREFORE, Atty. Thomas C. Uy Jr .is hereby SUSPENDED for one month. He is warned that a
The Court is not persuaded. Respondent's assertions are contradicted by the following transcript of repetition of the same or similar acts will be dealt with more severely.
stenographic notes: Let copies of this Decision be served on Atty. Thomas C. Uy Jr. at his given address or any other known
"Court: This P16,500, did you turn it over to the private complainant? one. Copies of this Decision shall also be entered in his record as attorney and served on the IBP, as well
Atty. Uy: No your Honor, because she wanted the full amount of the settlement. as the Court Administrator who shall circulate them to all the courts in the country for their information
Court: Private complainant, is it true that you did not want to accept the money? and guidance. SO ORDERED.
LEGAL ETHICS NO. 7 CANONS 16-22 6

IMELDA A. NAKPIL, complainant, vs. ATTY. CARLOS J. VALDES, respondent. Nakpil and ENORN, Inc. against her husbands estate which was represented by respondents law firm.
DECISION Complainant averred that there is no distinction between respondents law and auditing firms as respondent
PUNO, J.: is the senior and controlling partner of both firms which are housed in the same building. We required
The friendship of JOSE NAKPIL and respondent CARLOS J. VALDES dates back to the 50s during their respondent to answer the charges against him. In hisANSWER,[4]respondent initially asserted that the
schooldays in De La Salle and the Philippine Law School. Their closeness extended to their families and resolution of the first and second charges against him depended on the result of the pending action in the
respondent became the business consultant, lawyer and accountant of the Nakpils. CFI for reconveyance which involved the issue of ownership of the Moran property.
In 1965, Jose Nakpil became interested in purchasing a summer residence in Moran Street, Baguio On the merit of the first charge, respondent reiterated his defense in the reconveyance case that he did
City.[1] For lack of funds, he requested respondent to purchase the Moran property for him. They agreed not hold the Moran property in trust for the Nakpils as he is its absolute owner. Respondent explained that
that respondent would keep the property in thrust for the Nakpils until the latter could buy it back. Pursuant the Nakpils never bought back the Moran property from him, hence, the property remained to be his and
to their agreement, respondent obtained two (2) loans from a bank (in the amounts of P65,000.00 was rightly excluded from the inventory of Nakpils estate.
and P75,000.00) which he used to purchase and renovate the property. Title was then issued in respondents
As to the second charge, respondent denied preparing the list of claims against the estate which included
name. It was the Nakpils who occupied the Moran summer house. When Jose Nakpil died on July 8, 1973,
his loans of P65,000.00 and P75,000.00 for the purchase and renovation of the Moran property. In charging
respondent acted as the legal counsel and accountant of his widow, complainant IMELDA NAKPIL. On March
his loans against the estate, he stressed that the list drawn up by his accounting firm merely stated that
9, 1976, respondents law firm, Carlos J. Valdes & Associates, handled the proceeding for the settlement of
the loans in respondents name were applied probably for the purchase of the house and lot in Moran Street,
Joses estate. Complainant was appointed as administratix of the estate.
Baguio City. Respondent insisted that this was not an admission that the Nakpils owned the property as the
The ownership of the Moran property became an issue in the intestate proceedings. It appears that phrase probably for the purchase did not imply a consummated transaction but a projected acquisition.
respondent excluded the Moran property from the inventory of Joses estate. On February 13, 1978,
Respondent also disclaimed knowledge or privity in the preparation of a letter (Exhibit H) of his accounting
respondent transferred his title to the Moran property to his company, the Caval Realty Corporation. On
firm to the Baguio City treasurer remitting the real estate taxes for the Moran property on behalf of the
March 29, 1979, complainant sought to recover the Moran property by filing with the then Court of First
Nakpils. He contended that the letter could be a mere error or oversight. Respondent averred that it was
Instance (CFI) of Baguio City an action for reconveyance with damages against respondent and his
complainant who acknowledged that they did not own the Moran property for: (1) complainants February
corporation. In defense, respondent claimed absolute ownership over the property and denied that a trust
1979 Statement of Assets and Liabilities did not include the said property, and; (2) complainant, as
was created over it.
administratrix, signed the Balance Sheet of the Estate where the Moran property was not mentioned.
During the pendency of the action for reconveyance, complainant filed this administrative case to disbar Respondent admitted that complainant retained the services of his law and accounting firms in the
the respondent. She charged that respondent violated professional ethics when he: settlement of her husbands estate.[5] However, he pointed out that he has resigned from his law and
I. Assigned to his family corporation the Moran property (Pulong Maulap) which belonged to accounting firms as early as 1974. He alleged that it was Atty. Percival Cendaa (from the law firm Carlos
the estate he was settling as its lawyer and auditor. Valdes & Associates) who filed the inestate proceedings in court in 1976.
II. Excluded the Moran property from the inventory of real estate properties he prepared for
As to the third charge, respondent denied there was a conflict of interest when his law firm represented
a client-estate and, at the same time, charged the loan secured to purchase the said
the estate in the inestate proceedings while his accounting firm (C. J. Valdes & Co., CPAs) served as
excluded property as a liability of the estate, all for the purpose of transferring the title to
accountant of the estate and prepared the claims of creditors Angel Nakpil and ENORN, Inc. against the
the said property to his family corporation.
estate. He proffered the following reasons for his thesis: First, the two claimants were closely related to the
III. Prepared and defended monetary claims against the estate that retained him as its
late Nakpil. Claimant ENORN, Inc. is a family corporation of the Nakpils of which the late Nakpil was the
counsel and auditor.[2]
President. Claimant Angel Nakpil is a brother of the late Nakpil who, upon the latters death, became the
On the first charge, complainant alleged that she accepted respondents offer to serve as lawyer and auditor President of ENORN, Inc. These two claimants had been clients of his law and accounting firms even during
to settle her husbands estate. Respondents law firm then filed a petition for settlement of the estate of the the lifetime of Jose Nakpil. Second, his alleged representation of conflicting interests was with the
deceased Nakpil but did not include the Moran property in the estates inventory. Instead, respondent knowledge and consent of complainant as administratrix. Third, there was no conflict of interests between
transferred the property to his corporation, Caval Realty Corporation, and title was issued in its name. the estate and the claimants for they had forged a modus vivendi, i.e., that the subject claims would be
Complainant accused respondent of maliciously appropriating the property in trust knowing that it did not satisfied only after full payment of the principal bank creditors. Complainant, as administratrix, did not
belong to him. She claimed that respondent has expressly acknowledged that the said property belonged controvert the claims of Angel Nakpil and ENORN, Inc. Complainant has started paying off the claims of
to the late Nakpil in his correspondences[3] with the Baguio City Treasurer and the complainant. Angel Nakpil and ENORN, Inc. after satisfying the banks claims. Complainant did not assert that their claims
caused prejudice to the estate. Fourth, the work of Carlos J. Valdes and Co. as common auditor redounded
On the second charge, complainant alleged that respondents auditing firm (C. J. Valdes and Co., CPAs)
to the benefit of the estate for the firm prepared a true and accurate amount of the claim. Fifth, respondent
excluded the Moran property from the inventory of her husbands estate, yet included in the claims against
resigned from his law and accounting firms as early as August 15, 1974.[6] He rejoined his accounting firm
the estate the amounts of P65,000.00 and P75,000.00, which respondent represented as her husbands
several years later. He submitted as proof the SECs certification of the filing of his accounting firm of an
loans applied probably for the purchase of a house and lot in Moran Street, Baguio City. As to the third
Amended Articles of Partnership. Thus, it was not he but Atty. Percival Cendaa, from the firm Carlos J.
charge, complainant alleged that respondents law firm (Carlos J. Valdes and Associates) filed the petition
Valdes and Associates, who filed the intestate proceedings in court. On the other hand, the claimants were
for the settlement of her husbands estate in court, while respondents auditing firm (C. J. Valdes & Co.,
represented by their own counsel Atty. Enrique O. Chan. Sixth, respondent alleged that in the remote
CPAs) acted as accountant of both the estate and two of its creditors. She claimed that respondent
possibility that he committed a breach of professional ethics, he committed such misconduct not as a lawyer
represented conflicting interests when his accounting firm prepared the list of claims of creditors Angel
LEGAL ETHICS NO. 7 CANONS 16-22 7

but as an accountant who acted as common auditor of the estate and its creditors. Hence, he should be corporation. It also found no conflict of interests as the claimants were related to the late Jose Nakpil. The
held accountable in another forum. OSG recommended the dismissal of the administrative case. Prefatorily, we note that the case at bar
presents a novel situation as it involves the disbarment of a CPA-lawyer for his demeanor in his accounting
On November 12, 1979, complainant submitted her REPLY.[7] She maintained that the pendency of the
profession and law practice in connection with the property of his client.
reconveyance case is not prejudicial to the investigation of her disbarment complaint against respondent
for the issue in the latter is not the ownership of the Moran property but the ethics and morality of As a rule, a lawyer is not barred from dealing with his client but the business transaction must be
respondents conduct as a CPA-lawyer. characterized with utmost honesty and good faith.[12] The measure of good faith which an attorney is
required to exercise in his dealings with his client is a much higher standard than is required in business
Complainant alleged that respondents Annexes to his Reply (such as the Statement of Assets & Liability of
dealings where the parties trade at arms length.[13]Business transactions between an attorney and his client
the Nakpils and the Balance Sheet of the Estate) which showed that complainant did not claim ownership
are disfavored and discouraged by the policy of the law. Hence, courts carefully watch these transactions
of the Moran property were all prepared by C. J. Valdes and Co. as accountant of the estate of Jose Nakpil
to assure that no advantage is taken by a lawyer over his client. This rule is founded on public policy for,
and filed with the intestate court by C. J. Valdes and Associates as counsel for the estate. She averred that
by virtue of his office, an attorney is in an easy position to take advantage of the credulity and ignorance
these Annexes were not proofs that respondent owned the Moran property but were part of respondents
of his client. Thus, no presumption of innocence or improbability of wrongdoing is considered in an attorneys
scheme to remove the property from the estate and transfer it to his family corporation. Complainant
favor. [14]
alleged that she signed the documents because of the professional counsel of respondent and his firm that
her signature thereon was required. Complainant charged respondent with greed for coveting the Moran In the case at bar, we cannot subscribe to the findings of the OSG in its Report. These findings were based
property on the basis of defects in the documents he himself prepared. Complainant urged that respondent mainly on the decision of the Court of Appeals in the action for reconveyance which was reversed by this
cannot disown unfavorable documents (the list of claims against the estate and the letter regarding Nakpils Court in 1993.[15] As to the first two charges, we are bound by the factual findings of this Court in the
payments of realty tax on the Moran property) which were prepared by his law and accounting firms and aforementioned reconveyance case.[16] It is well-established that respondent offered to the complainant
invoke other documents prepared by the same firms which are favorable to him. She averred that the services of his law and accounting firms by reason of their close relationship dating as far back as the
respondent must accept responsibility not just for some, but for all the representations and communications 50s. She reposed her complete trust in respondent who was the lawyer, accountant and business consultant
of his firms. Complainant refuted respondents claim that he resigned from his firms from March 9, 1976 to of her late husband. Respondent and the late Nakpil agreed that the former would purchase the Moran
several years later. She alleged that none of the documents submitted as evidence referred to his property and keep it in trust for the latter. In violation of the trust agreement, respondent claimed absolute
resignation from his law firm. The documents merely substantiated his resignation from his accounting firm. ownership over the property and refused to sell the property to complainant after the death of Jose Nakpil.
To place the property beyond the reach of complainant and the intestate court, respondent later transferred
In his REJOINDER,[8] respondent insisted that complainant cannot hold him liable for representing the
it to his corporation.
interests of both the estate and the claimants without showing that his action prejudiced the estate. He
urged that it is not per se anomalous for respondents accounting firm to act as accountant for the estate Contrary to the findings of the OSG, respondent initially acknowledged and respected the trust nature of
and its creditors. He reiterated that he is not subject to the jurisdiction of this Court for he acted not as the Moran property. Respondents bad faith in transferring the property to his family corporation is well
lawyer, but as accountant for both the estate and its claimants. He alleged that his accounting firm merely discussed in this Courts Decision,[17] thus:
prepared the list of claims of the creditors Angel Nakpil and ENORN, Inc. Their claims were not defended x x x Valdes (herein respondent) never repudiated the trust during the lifetime of
by his accounting or law firm but by Atty. Enrique Chan. He averred that his law firm did not oppose these the late Jose Nakpil. On the contrary, he expressly recognized it. x x x (H)e repudiated
claims as they were legitimate and not because they were prepared by his accounting firm. He emphasized the trust when (he) excluded Pulong Maulap from the list of properties of the late Jose Nakpil
that there was no allegation that the claims were fraudulent or excessive and that the failure of respondents submitted to the intestate court in 1973. x x x
law firm to object to these claims damaged the estate. xxx
The fact that there was no transfer of ownership intended by the parties x x x can be bolstered
In our January 21, 1980 Resolution,[9] we deferred further action on the disbarment case until after
by Exh. I-2, an annex to the claim filed against the estate proceedings of the late Jose Nakpil
resolution of the action for reconveyance between the parties involving the issue of ownership by the then
by his brother, Angel Nakpil, which was prepared by Carlos J. Valdes & Co., the accounting firm
CFI of Baguio. Complainant moved for reconsideration on the ground that the issue of ownership pending
of herein respondent. Exhibit I-2, which is a list of the application of the proceeds
with the CFI was not prejudicial to her complaint which involved an entirely different issue, i.e., the unethical
of various FUB loans contracted as of 31 December 1973 by the late Jose Nakpil, x x
acts of respondent as a CPA-lawyer. We granted her motion and referred the administrative case to the
x contains the two (2) loans contracted in the name of respondent. If ownership
Office of the Solicitor General (OSG) for investigation, report and recommendation. [10] In 1983, the CFI of
of Pulong Maulap was already transferred or ceded to Valdes, these loans should
Baguio dismissed the action for reconveyance. The trial court ruled that respondent held the Moran property
not have been included in the list.
in trust for the Nakpils but found that complainant waived her right over it.
Indeed, as we view it, what the parties merely agreed to under the arrangement outlined
On appeal, the Court of Appeals reversed the trial court. The appellate court held that respondent was the in Exh. J was that respondent Valdes would x x x take over the total loan
absolute owner of the Moran property. The Decision was elevated to this Court. of P140,000.00 and pay all of the interests due on the notes while the heirs of the
late Jose Nakpil would continue to live in the disputed property for five (5) years
On February 18, 1986, during the pendency of complainants appeal to this Court, the OSG submitted its without remuneration save for regular maintenance expenses. This does not mean,
Report[11] on the disbarment complaint. The OSG relied heavily on the decision of the Court of Appeals then however, that if at the end of the five-year period petitioner (Nakpil) failed to
pending review by this Court. The OSG found that respondent was not put on notice of complainants claim reimburse Valdes for his advances, x x x Valdes could already automatically assume
over the property. It opined that there was no trust agreement created over the property and that ownership of Pulong Maulap. Instead, the remedy of respondents Carlos J. Valdes
respondent was the absolute owner thereof. Thus, it upheld respondents right to transfer title to his family
LEGAL ETHICS NO. 7 CANONS 16-22 8

and Caval Realty Corporation was to proceed against the estate of the late Jose M. by any documentary proof. The documents on record [24] only show respondents resignation from his
Nakpil and/or the property itself. (emphasis supplied) accounting firm in 1972 and 1974. Even these documents reveal that respondent returned to his accounting
firm on July 1, 1976 and as of 1978, the intestate proceedings for the settlement of Joses estate had not
In the said reconveyance case, we further ruled that complainants documentary evidence (Exhibits H, J and
yet been terminated. It does not escape us that when respondent transferred the Moran property to his
L), which she also adduced in this administrative case, should estop respondent from claiming that he
corporation on February 13, 1978, the intestate proceedings was still pending in court. Thus, the succession
bought the Moran property for himself, and not merely in trust for Jose Nakpil.[18] It ought to follow that
of events shows that respondent could not have been totally ignorant of the proceedings in the intestate
respondents act of excluding Moran property from the estate which his law firm was representing evinces
case. Respondent claims that complainant knew that his law firm Carlos J. Valdes & Associates was the
a lack of fidelity to the cause of his client. If respondent truly believed that the said property belonged to
legal counsel of the estate[25] and his accounting firm, C.J. Valdes & Co., CPAs, was the auditor of both the
him, he should have at least informed complainant of his adverse claim. If they could not agree on its
estate and the two claimants against it.[26] The fact, however, that complainant, as administratrix, did not
ownership, respondent should have formally presented his claim in the intestate proceedings instead of
object to the set-up cannot be taken against her as there is nothing in the records to show that respondent
transferring the property to his own corporation and concealing it from complainant and the judge in the
or his law firm explained the legal situation and its consequences to complainant. Thus, her silence
estate proceedings. Respondents misuse of his legal expertise to deprive his client of the Moran property
regarding the arrangement does not amount to an acquiescence based on an informed consent.
is clearly unethical.
We also hold that the relationship of the claimants to the late Nakpil does not negate the conflict of interest.
To make matters worse, respondent, through his accounting firm, charged the two loans of P65,000.00
When a creditor files a claim against an estate, his interest is per seadverse to the estate. As correctly
and P75,000.00 as liability of the estate, after said loans were obtained by respondent for the purchase and
pointed out by complainant, if she had a claim against her husbands estate, her claim is still adverse and
renovation of the property which he claimed for himself. Respondent seeks to exculpate himself from this
must be filed in the intestate proceedings. Prescinding from these premises, respondent undoubtedly placed
charge by disclaiming knowledge or privity in the preparation of the list of the estates liabilities. He theorizes
his law firm in a position where his loyalty to his client could be doubted. In the estate proceedings, the
that the inclusion of the loans must have been a mere error or oversight of his accounting firm. It is clear
duty of respondents law firm was to contest the claims of these two creditors but which claims were
that the information as to how these two loans should be treated could have only come from respondent
prepared by respondents accounting firm. Even if the claims were valid and did not prejudice the estate,
himself as the said loans were in his name. Hence, the supposed error of the accounting firm in charging
the set-up is still undesirable. The test to determine whether there is a conflict of interest in the
respondents loans against the estate could not have been committed without respondents participation.
representation is probability, not certainty of conflict. It was respondents duty to inhibit either of his firms
Respondent wanted to have his cake and eat it too and subordinated the interest of his client to his own
from said proceedings to avoid the probability of conflict of interest.
pecuniary gain. Respondent violated Canon 17 of the Code of Professional Responsibility which provides
that a lawyer owes fidelity to his clients cause and enjoins him to be mindful of the trust and confidence Respondent advances the defense that assuming there was conflict of interest, he could not be charged
reposed on him. before this Court as his alleged misconduct pertains to his accounting practice.
As regards the third charge, we hold that respondent is guilty of representing conflicting interests. It is We do not agree. Respondent is a CPA-lawyer who is actively practicing both professions. He is the senior
generally the rule, based on sound public policy, that an attorney cannot represent adverse interests. It is partner of his law and accounting firms which carry his name. In the case at bar, complainant is not charging
highly improper to represent both sides of an issue.[19] The proscription against representation of conflicting respondent with breach of ethics for being the common accountant of the estate and the two creditors. He
interests finds application where the conflicting interests arise with respect to the same general is charged for allowing his accounting firm to represent two creditors of the estate and, at the same time,
matter[20] and is applicable however slight such adverse interest may be. It applies although the attorneys allowing his law firm to represent the estate in the proceedings where these claims were presented. The
intentions and motives were honest and he acted in good faith. [21] However, representation of conflicting act is a breach of professional ethics and undesirable as it placed respondents and his law firms loyalty
interests may be allowed where the parties consent to the representation, after full disclosure of facts. under a cloud of doubt. Even granting that respondents misconduct refers to his accountancy practice, it
Disclosure alone is not enough for the clients must give their informed consent to such representation. The would not prevent this Court from disciplining him as a member of the Bar. The rule is settled that a lawyer
lawyer must explain to his clients the nature and extent of conflict and the possible adverse effect must be may be suspended or disbarred for ANY misconduct, even if it pertains to his private activities, as long as
thoroughly understood by his clients.[22] it shows him to be wanting in moral character, honesty, probity or good demeanor. [27] Possession of good
moral character is not only a prerequisite to admission to the bar but also a continuing requirement to the
In the case at bar, there is no question that the interests of the estate and that of it creditors are adverse
practice of law.
to each other. Respondents accounting firm prepared the list of assets and liabilities of the estate and, at
the same time, computed the claims of two creditors of the estate. There is clearly a conflict between the Public confidence in law and lawyers may be eroded by the irresponsible and improper conduct of a member
interest of the estate which stands as the debtor, and that of the two claimants who are creditors of the of the bar. Thus, a lawyer should determine his conduct by acting in a manner that would promote public
estate. In fact, at one instance, respondents law firm questioned the claims of creditor Angel Nakpil against confidence in the integrity of the legal profession. Members of the bar are expected to always live up to the
the estate. standards embodied in the Code of Professional Responsibility as the relationship between an attorney and
his client is highly fiduciary in nature and demands utmost fidelity and good faith. [28] In the case at bar,
To exculpate himself, respondent denies that he represented complainant in the intestate proceedings. He
respondent exhibited less than full fidelity to his duty to observe candor, fairness and loyalty in his dealings
points out that it was one Atty. Percival Cendaa, from his law firm Carlos J. Valdes & Associates, who filed
and transactions with his clients. [29]
the intestate case in court. However, the fact that he did not personally file the case and appear in court is
beside the point. As established in the records of this case and in the reconveyance case, [23] respondent IN VIEW WHEREOF, the Court finds respondent ATTY. CARLOS J. VALDES guilty of misconduct. He is
acted as counsel and accountant of complainant after the death of Jose Nakpil. Respondents defense that suspended from the practice of law for a period of one (1) year effective from receipt of this Decision, with
he resigned from his law and accounting firms as early as 1974 (or two years before the filing of the a warning that a similar infraction shall be dealt with more severely in the future. SO ORDERED.
intestate case) is unworthy of merit. Respondents claim of resignation from his law firm is not supported
LEGAL ETHICS NO. 7 CANONS 16-22 9

[A.C. CBD No. 167. March 9, 1999] Respondents claim that he may not be held liable because he committed such acts, not in his capacity as a
ATTY. PRUDENCIO S. PENTICOSTES, complainant, vs. PROSECUTOR DIOSDADO S. private lawyer, but as a prosecutor is unavailing. Canon 6 of the Code of Professional Responsibility
IBAEZ, respondent. provides:
RESOLUTION
These canons shall apply to lawyers in government service in the discharge of their official tasks.
ROMERO, J.:
As stated by the IBP Committee that drafted the Code, a lawyer does not shed his professional obligations
Sometime in 1989, Encarnacion Pascual, the sister-in-law of Atty. Prudencio S. Penticostes (herein
upon assuming public office. In fact, his public office should make him more sensitive to his professional
complainant) was sued for non-remittance of SSS payments. The complaint was docketed as I.S. 89-353
obligations because a lawyers disreputable conduct is more likely to be magnified in the publics eye. [3] Want
and assigned to Prosecutor Diosdado S. Ibaez (herein respondent) for preliminary investigation. In the
of moral integrity is to be more severely condemned in a lawyer who holds a responsible public office.[4]
course of the investigation, Encarnacion Pascual gave P1,804.00 to respondent as payment of her Social
Security System (SSS) contribution in arrears. Respondent, however, did not remit the amount to the ACCORDINGLY, this Court REPRIMANDS respondent with a STERN WARNING that a commission of the
system. The fact of non-payment was certified to by the SSS on October 2, 1989. similar offense will be dealt with more severely in the future. SO ORDERED.
On November 16, 1990 or over a year later, complainant filed with the Regional Trial Court of Tarlac a
complaint for professional misconduct against Ibaez due to the latters failure to remit the SSS contributions
of his sister-in-law. The complaint alleged that respondents misappropriation of Encarnacion Pascuals SSS
contributions amounted to a violation of his oath as a lawyer. Seven days later, or on November 23, 1990,
respondent paid P1,804.00 to the SSS on behalf of Encarnacion Pascual.
In the meantime, the case was referred to the Integrated Bar of the Philippines-Tarlac Chapter, the court
observing that it had no competence to receive evidence on the matter. Upon receipt of the case, the Tarlac
Chapter forwarded the same to IBPs Commission on Bar Discipline.
In his defense, respondent claimed that his act of accommodating Encarnacion Pascuals request to make
payment to the SSS did not amount to professional misconduct but was rather an act of Christian
charity. Furthermore, he claimed that the action was moot and academic, the amount of P1,804.00 having
already been paid by him to the SSS. Lastly, he disclaimed liability on the ground that the acts complained
were not done by him in his capacity as a practicing lawyer but on account of his office as a prosecutor.
On September 3, 1998, the Commission recommended that the respondent be reprimanded, with a warning
that the commission of the same or similar offense would be dealt with more severely in the future. On
November 5, 1998, the Board of Governors of the Integrated Bar of the Philippines adopted and approved
its Commissions recommendation.
This Court adopts the recommendation of the IBP and finds respondent guilty of professional
misconduct. While there is no doubt that payment of the contested amount had been effected to the SSS
on November 23, 1990, it is clear however, that the same was made only after a complaint had been filed
against respondent. Furthermore, the duties of a provincial prosecutor do not include receiving money from
persons with official transactions with his office.
This Court has repeatedly admonished lawyers that a high sense of morality, honesty and fair dealing is
expected and required of a member of the bar. Rule 1.01 of the Code of Professional Responsibility provides
that [a] lawyer shall not engage in unlawful, dishonest, immoral or deceitful conduct.
It is glaringly clear that respondents non-remittance for over one year of the funds coming from Encarnacion
Pascual constitutes conduct in gross violation of the above canon. The belated payment of the same to the
SSS does not excuse his misconduct. While Pascual may not strictly be considered a client of respondent,
the rules relating to a lawyers handling of funds of a client is applicable. In Daroy v. Legaspi,[1] this court
held that (t)he relation between an attorney and his client is highly fiduciary in nature...[thus] lawyers are
bound to promptly account for money or property received by them on behalf of their clients and failure to
do so constitutes professional misconduct. The failure of respondent to immediately remit the amount to
the SSS gives rise to the presumption that he has misappropriated it for his own use. This is a gross violation
of general morality as well as professional ethics; it impairs public confidence in the legal profession and
deserves punishment.[2]

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