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SECOND DIVISION HUMBERTO C. LIM, JR., in behalf of PENTA RESORTS CORPORATION/Attorney-inFact of LUMOT A. JALANDONI, Complainant, A.C. No.

5303

Present: PUNO, J., Chairperson, SANDOVAL-GUTIERREZ, CORONA, AZCUNA and GARCIA, JJ. Promulgated: June 15, 2006

- versus -

ATTY. NICANOR V. VILLAROSA, Respondent.

x---------------------------------------- x RESOLUTION CORONA, J. Humberto C. Lim Jr.[1] filed a verified complaint for disbarment against respondent Atty. Nicanor V. Villarosa on July 7, 2000.[2] On February 19, 2002, respondent moved for the consolidation of the said complaint with the following substantially interrelated cases earlier filed with the First Division of this Court: 1. 2. Administrative Case No. 5463: Sandra F. Vaflor v. Atty. Adoniram P. Pamplona and Atty. Nicanor V. Villarosa; Administrative Case No. 5502: Daniel A. Jalandoni v. Atty. Nicanor V. Villarosa.

In a resolution dated February 24, 2003, this Court considered Administrative Case No. 5463 closed and terminated.[3] On February 4, 2004, considering the pleadings filed in Administrative Case No. 5502, the Court resolved: (a) to NOTE the notice of the resolution dated September 27, 2003 of the Integrated Bar of the Philippines dismissing the case against respondent for lack of merit; and to DENY, for lack of merit, the petition filed by complainant praying that the resolution of the Integrated Bar of the Philippines dismissing the instant case be reviewed and that proper sanctions be imposed upon respondent.[4]

(b)

No motion for reconsideration of the aforesaid denial in Administrative Case No. 5502 appears in the records. The Court is now called upon to determine the merits of this remaining case (A.C. No. 5303) against respondent. The complaint read: AS FIRST CAUSE OF ACTION xxx xxx - II That respondent is a practicing lawyer and a member of the Integrated Bar of the Philippines, Bacolod City, Negros Occidental Chapter. That sometime on September 19, 1997, Lumot A. Jalandoni, Chairman/President of PRC was sued before RTC, Branch 52 in Civil Case No. 97-9865, RE: Cabiles et al. vs. Lumot Jalandoni, et al. The latter engaged the legal services of herein respondent who formally entered his appearance on October 2, 1997 as counsel for the defendants Lumot A. Jalandoni/Totti Anlap Gargoles. Respondent as a consequence of said Attorney-Client relationship represented Lumot A. Jalandoni et al in the entire proceedings of said case. Utmost trust and confidence was reposed on said counsel, hence delicate and confidential matters involving all the personal circumstances of his client were entrusted to the respondent. The latter was provided with all the necessary information relative to the property in question and likewise on legal matters affecting the corporation (PRC) particularly [involving] problems [which affect] Hotel Alhambra. Said counsel was privy to all transactions and affairs of the corporation/hotel. - III That it was respondent who exclusively handled the entire proceedings of afore-cited Civil Case No. 97-9865 [and] presented Lumot A. Jalandoni as his witness prior to formally resting his case. However, on April 27, 1999 respondent, without due notice prior to a scheduled hearing, surprisingly filed a Motion to withdraw as counsel, one day before its scheduled hearing on April 28, 1999. A careful perusal of said Motion to Withdraw as Counsel will conclusively show that no copy thereof was furnished to Lumot A. Jalandoni, neither does it bear her conformity. No doubt, such notorious act of respondent resulted to (sic) irreparable damage and injury to Lumot A. Jalandoni, et al since the decision of the court RTC, Branch 52 proved adverse to Lumot A. Jalandoni, et al. The far reaching effects of the untimely and unauthorized withdrawal by respondent caused irreparable damage and injury to Lumot A. Jalandoni, et al; a highly meritorious case in favor of his client suddenly [suffered] unexpected defeat. - IV That the grounds alleged by respondent for his withdrawal as counsel of Lumot A. Jalandoni, et al. was that he is [a] retained counsel of Dennis G. Jalbuena and the Fernando F. Gonzaga, Inc. It was Dennis G. Jalbuena who xxx

recommended him to be the counsel of Lumot A. Jalandoni, et al. It is worthy to note that from the outset, respondent already knew that Dennis G. Jalbuena is the son-in-law of Lumot A. Jalandoni being married to her eldest daughter, Carmen J. Jalbuena. The other directors/officers of PRC were comprised of the eldest sibling of the remaining children of Lumot A. Jalandoni made in accordance with her wishes, with the exception of Carmen J. Jalbuena, the only daughter registered as one of the incorporators of PRC, obviously, being the author of the registration itself [sic]. Respondent further stated that he cannot refuse to represent Dennis G. Jalbuena in the case filed against the latter before the City Prosecutors Office by PRC/Lumot A. Jalandoni due to an alleged retainership agreement with said Dennis G. Jalbuena. [He] likewise represented Carmen J. Jalbuena and one Vicente Delfin when PRC filed the criminal complaint against them. On April 06, 1999, twenty-one (21) days prior to respondents filing of his Motion to Withdraw as Counsel of Lumot A. Jalandoni, et al., respondent entered his appearance with Bacolod City Prosecutor OIC-Vicente C. Acupan, through a letterexpressly stating that effective said date he was appearing as counsel for both Dennis G. Jalbuena and Carmen J. Jalbuena and Vicente Delfin in the Estafa case filed by the corporation (PRC) against them. Simply stated, as early as April 6, 1999 respondent already appeared for and in behalf of the Sps. Carmen and Dennis Jalbuena/Vicente Delfin while concurrently representing Lumot A. Jalandoni, et al. in Civil Case No. 97-9865. However, despite being fully aware that the interest of his client Lumot A. Jalandoni [holding an equivalent of Eighty-two (82%) percent of PRCs shares of stocks] and the interest of PRC are one and the same, notwithstanding the fact that Lumot A. Jalandoni was still his client in Civil Case No. 97-9862, respondent opted to represent opposing clients at the same time. The corporations complaint for estafa (P3,183,5525.00) was filed against the Sps. Dennis and Carmen J. Jalbuena together with UCPB bank manager Vicente Delfin. Succeeding events will show that respondent instead of desisting from further violation of his [lawyers] oath regarding fidelity to his client, with extreme arrogance, blatantly ignored our laws on Legal Ethics, by palpably and despicably defending the Sps. Dennis and Carmen J. Jalbuena in all the cases filed against them by PRC through its duly authorized representatives, before the Public Prosecutors Office, Bacolod City (PP vs. Sps. Dennis and Carmen J. Jalbuena for False Testimony/Perjury, viol. of Art. 183 RPC under BC I.S. No. 2000-2304; viol. of Art. 363, 364, 181 and 183 RPC under BC I.S. 2000-2343, PP vs. Carmen J. Jalbuena for viol. of Art. 315 under BC I.S. 2000-2125 and various other related criminal cases against the Sps. Dennis and Carmen Jalbuena). AS SECOND CAUSE OF ACTION xxx xxx -Ixxx xxx xxx xxx

There is no dispute that respondent was able to acquire vast resources of confidential and delicate information on the facts and circumstances of [Civil Case No. 97-9865] when Lumot A. Jalandoni was his client which knowledge and information was acquired by virtue of lawyer-client relationship between respondent and his clients. Using the said classified information which should have been closely guarded respondent did then

and there, willfully, unlawfully, feloniously conspired and confabulated with the Sps. Dennis and Carmen J. Jalbuena in concocting the despicable and fabricated charges against his former clients denominated as PP vs. Lumot A. Jalandoni, Pamela J. Yulo, Cristina J. Lim and Leica J. Lim for viol. of Art. 172 of Revised Penal Code due to a board resolution executed by the corporation which the Sps. Jalbuena, with the assistance of herein respondent, claimed to have been made without an actual board meeting due to an alleged lack of quorum, [among other things]. Were it not for said fiduciary relation between client and lawyer, respondent will not be in a position to furnish his conspirator spouses with confidential information on Lumot A. Jalandoni/PRC, operator of Alhambra Hotel. - II Adding insult to injury, respondent opted to deliberately withhold the entire case file including the marked exhibits of the Cabiles case for more than three (3) months after his untimely unilateral withdrawal therefrom, despite repeated demands from [his] client. On July 26, 1999, capitalizing on his knowledge of the indispensability of said documents particularly the marked exhibits, which deadline to file the formal offer of exhibits was continually impressed upon the new counsel by the court, respondent suddenly interposed an amount of five thousand (P5,000.00) pesos as consideration prior to or simultaneous to the turnover of said documents. [On] July 29, 1999, left with no other alternative owing to the urgency of the situation, PRC issued Check No. 2077686 for P5,000.00 in payment thereof. This was duly received by respondents office on the same date. Such dilatory tactics employed by respondent immensely weakened the case of Lumot A. Jalandoni eventually resulting to (sic) an adverse decision against [her]. Further demonstrating before this Honorable Court the notoriety of respondent in representing conflicting interest which extended even beyond the family controversy was his improper appearance in court in Civil Case No. 99-10660, RE: Amy Albert Que vs. Penta Resorts Corp., this time favoring the party opponent of defendant who is even outside the family circle. During the pre-trial hearing conducted on May 5, 1999, while still [holding] exclusive possession of the entire case file of his client in Civil Case No. 97-9865, respondent brazenly positioned himself beside Atty. Adoniram P. Pamplona, counsel of plaintiff [in] a suit against his client Lumot A. Jalandoni/PRC, coaching said counsel on matters [he was privy to] as counsel of said client. Facts mentioned by said counsel of the plaintiff starting from the last par. of page 25 until and including the entire first par. of page 26 were the exact words dictated by respondent. The entire incident was personally witnessed by herein complainant [who was] only an arms length away from them during the hearing. However, the particular portion showing the said irregular acts of respondent was deliberately excluded by the court stenographer from the transcript, despite her detailed recollection and affirmation thereof to herein complainant. This prompted the new counsel of Lumot A. Jalandoni/PRC to complain to the court why Atty. Nicanor Villarosa was coaching Atty. Pamplona in such proceedings. Said corrections were only effected after repeated demands to reflect the actual events which [transpired] on said pre-trial.[5](emphasis ours)

In an addendum to the July 4, 2000 complaint, Lim also pointed to certain acts of respondent which allegedly violated the Rules of Court perpetration of falsehood and abuse of his influence as former public prosecutor. These supposedly affected the status of the cases that Lim filed against the clients of respondent.[6] In a motion to dismiss dated October 30, 2000, respondent claimed that the complainant violated Circular No. 48-2000 because, in his verification, Lim stated: 3. That [he] prepared this instant complaint for disbarment against Atty. Nicanor V. Villarosa, read its contents, the same are all true and correct to [his] own personal knowledge and belief.[7] (emphasis ours) Section 4, Rule 7 of the Rules of Court explicitly provides that: SEC. 4. Verification. Except when otherwise specifically required by law or rule, pleadings need not be under oath, verified or accompanied by affidavit. (5a) A pleading is verified by an affidavit that the affiant has read the pleading and that the allegations therein are true and correct of his personal knowledge or based on authentic records. A pleading required to be verified which contains verification based on information and belief or upon knowledge, information and belief, or lacks a proper verification, shall be treated as an unsigned pleading. (As amended, A.M. 00-2-10, May 1, 2000.) (emphasis ours)

While the Rules provide that an unsigned pleading produces no legal effect,[8] the court may, in its discretion, allow such deficiency to be remedied if it appears that the same was due to mere inadvertence and not intended for delay.[9] We find that Lim was not shown to have deliberately filed the pleading in violation of the Rules. In his comment dated December 1, 2000, respondent, reiterating his ground for the dismissal of the complaint, added: [that] complainant Humberto C. Lim, Jr. has not only violated the Rule on Civil Procedure but he was/is NOT duly authorize[d] by the Penta Resorts Corp. (PRC) nor [by] Lumot A. Jalandoni to file this complaint against [him]. Neither [was Lim] a proper party to file this complaint. This fact is an additional ground to have his case dismissed because Humberto C. Lim Jr. exceeded whatever authority was granted to him as embodied in a resolution and the Special Power of Attorney allegedly granted to him by the complainants.[10] To bolster his assertion that the complaint against him was unfounded, respondent presented the following version in his defense: FACTS OF THE CASE

xxx

xxx

xxx

That Mrs. Jalandoni has two sons-in-law, namely Dennis G. Jalbuena married to her daughter, Carmen J. Jalbuena, and Humberto C. Lim Jr., the herein complainant married to her daughter, Cristina J. Lim. That Mrs. Lumot Jalandoni organized a corporation namely the Penta Resorts Corporation (PRC) where she owned almost ninety seven percent (97%). In other words, in reality, Penta Resorts Corporation is a single proprietorship belonging to Mrs. Jalandoni. That the only property of the corporation is as above-stated, the Alhambra Hotel, constructed solely through the effort of the spouses Jalbuena on that parcel of land now claimed by the Cabiles family. That sometime on the year 1997 the case above-cited (Civil Case No. 97-9865) was filed before the court against the sisters. That [he], being RETAINED counsel of the spouses Dennis and Carmen J. Jalbuena was RECOMMENDED by the spouses to the sisters to answer the complaint filed against them. II. That as counsel to the sisters, [he] filed a Motion for Extension Of Time To File Answer and ultimately, [he] filed an Answer With Counter-Claim And Prayer For Issuance Of Writ Of Preliminary Injunction. That reading the Answer it is clear that the defense of the sisters totally rest on public documents (the various titles issued to the land in question because of the series [of changes] in ownership) and the sisters and their parents actual occupation and possession thereof. xxx xxx xxx Mr. Lim[s] accusation against [him] in the light of the above-facts is the best evidence of Humberto C. Lim, Jr.s penchant for exaggeration and distortion of the truth. Since the defense of the sisters to retain ownership of the land in question is based on PUBLIC documents, what delicate and confidential matters involving personal circumstances of the sisters allegedly entrusted to [him], is Mr. Humberto C. Lim, Jr. talking about in paragraphs I and II of his Complaint? What [privity] to all transactions and affairs of the corporation/hotel is he referring to? Whatever transactions the corporation may have been involved in or [may be getting involved into], is totally immaterial and irrelevant to the defense of the sisters. There was nothing personal [about the] circumstances of the sisters nor transactions of the corporation [which were] discussed. The documents being offered as evidence, [he] reiterate[s] for emphasis, are public; the presumption is that the whole world knows about them. That [he] [also] vehemently den[ies] another distorted allegation of Mr. Lim that [he] represented Mrs. Jalandoni [in] the entire proceedings of [the] case. [Lim] himself attested that [he] [filed] [his] Motion to Withdraw As Counsel, dated April 26, 1999 , before the trial court, sometime on April

27, 1999. How then could [he] have represented Mrs. Jalandoni [the] entire proceedings of the case?

for

Further, Mr. Lim intentionally hid from this Honorable Court the important fact that [his] Motion to Withdraw was APPROVED by the trial court because of the possibility of a conflict of interest. xxx xxx xxx. [11] Respondent discredited Lims claim that he deliberately withheld the records of the cited civil case. He insisted that it took him just a few days, not three months, to turn over the records of the case to Lim.[12] While he admitted an oversight in addressing the notice of the motion to withdraw as counsel to Mrs. Totti Anlap Gargoles instead of Mrs. Jalandoni at Hotel Alhambra, he maintained that it was the height of hypocrisy to allege that Mrs. Jalandoni was not aware of his motion to withdraw[13] since Mrs. Gargoles is Mrs. Jalandonis sister and Hotel Alhambra is owned by PRC which, in turn, actually belongs to Mrs. Jalandoni. Respondent also argued that no prejudice was suffered by Mrs. Jalandoni because she was already represented by Atty. Lorenzo S. Alminaza from the first hearing date.[14] In fact, respondent contended, it was he who was not notified of the substitution of counsels.[15] As to the bill of P 5,000, respondent stated: That Mr. Lim begrudge[s] [him] for billing Mrs. Jalandoni Five Thousand (Php5,000.00) Pesos. Mr. Humberto C. Lim Jr. conveniently forgets that the net worth of the property together with its improvements, under litigation in that Cabiles, et al. vs. Gargoles et al. case, is a minimum of THIRTY MILLION (Php30,000,000.00) PESOS then, and more so now. [He] cannot find any law which prohibits a counsel from billing a client for services in proportion to the services he rendered.[16] In view of these developments, respondent was adamant that: the only real question to be answered in this complaint is why Mr. Lim so consistently [determined] to immerse the Jalandoni family [in] a series of criminal and civil suits and to block all attempts to reconcile the family by prolonging litigations, complaints and filing of new ones in spite of the RESOLUTION of the corporation and the UNDERTAKING of the members.[17] On June 18, 2001, the Court resolved to refer the complaint to the Integrated Bar of the Philippines (IBP) for investigation. Commissioner Lydia A. Navarro made the following report and recommendation: xxx xxx xxx

After going over the [pieces of evidence] submitted by the parties[,] the undersigned noted that from the onset, PRC had a case wherein respondent was its counsel. Later on, complainant had a case against spouses Jalbuena where the parties were related to each other and the latter spouses were represented by the respondent as their retained counsel; after respondent had allegedly withdrawn as counsel for the complainant in Civil Case No. 97-9865.

Being the husband of one of the complainants which respondent himself averred in his answer, it is incumbent upon Humberto Lim Jr. to represent his wife as one of the representatives of PRC and Alhambra Hotel in the administrative complaint to protect not only her interest but that of the [familys]. From the facts obtaining, it is evident that complainant had a lawyerclient relationship with the respondent before the latter [was] retained as counsel by the Spouses Jalbuena when the latter were sued by complainants representative. We cannot disregard the fact that on this situation for some reason or another there existed some confidentiality and trust between complainants and respondent to ensure the successful defense of their cases. Respondent for having appeared as counsel for the Spouses Jalbuena when charged by respondents former client Jalandoni of PRC and Alhambra Hotel, represented conflicting interests in violation of the Canon of Professional Responsibility. As such therefore, the Undersigned has no alternative but to respectfully recommend the suspension of the respondent from the practice of law for a period of six (6) months from receipt hereof. RESPECTFULLY SUBMITTED. Pasig City, June 20, 2002.[18] The IBP Board of Governors (Board), however, reversed the recommendation of the investigating commissioner and resolved to dismiss the case on August 3, 2002.[19] Lumot A. Jalandoni filed a motion for reconsideration (MR) on October 18, 2002 but the Board denied the MR since it no longer had jurisdiction to consider and resolve a matter already endorsed to this Court.[20] Before delving into the core issues of this case, we need to address some preliminary matters. Respondent argues that the alleged resolution of PRC and the special power of attorney given by Lumot A. Jalandoni to Humberto did not contemplate the filing of an administrative complaint.[21] Citing the Rules of Court, respondent said that: [s]uch complaints are personal in nature and therefore, the filing of the same, cannot be delegated by the alleged aggrieved party to any third person unless expressly authorized by law. We must note, however, the following: SECTION 1. How instituted. Proceedings for disbarment, suspension or discipline of attorneys may be taken by the Supreme Court motu propio, or by the Integrated Bar of the Philippines (IBP) upon the verified complaint of any person. The complaint shall state clearly and concisely the facts complained of and shall be supported by affidavits or persons having personal

knowledge of the facts therein alleged and/or by such documents a may substantiate said facts. The IBP Board of Governors may, motu propio or upon referral by the Supreme Court or by a Chapter Board of Officers, or at the instance of any person, initiate and prosecute proper charges against any erring attorneys. [22] (emphasis ours) Complaints against members of the Bar are pursued to preserve the integrity of the legal profession, not for private vendetta. Thus, whoever has such personal knowledge of facts constituting a cause of action against erring lawyers may file a verified complaint with the Court or the IBP.[23] Corollary to the public interest in these proceedings is the following rule: SEC. 11. Defects. No defect in a complaint, notice, answer, or in the proceeding or the Investigators Report shall be considered as substantial unless the Board of Governors, upon considering the whole record, finds that such defect has resulted or may result in a miscarriage of justice, in which event the Board shall take such remedial action as the circumstances may warrant, including invalidation of the entire proceedings.[24] (emphasis ours) Respondent failed to substantiate his allegation that Lims complaint was defective in form and substance, and that entertaining it would result in a miscarriage of justice. For the same reason, we will no longer put in issue the filing at the onset of a motion to dismiss by respondent instead of an answer or comment.[25] The core issues before us now are: 1. 2. whether there existed a conflict of interest in the cases represented and handled by respondent, and whether respondent properly withdrew his services as counsel of record in Civil Case No. 97-9865.

CONFLICT OF INTEREST Petitioners alleged that as an offshoot of representing conflicting interests, breach of attorney-client confidentiality and deliberate withholding of records were committed by respondent. To effectively unravel the alleged conflict of interest, we must look into the cases involved. In Civil Case No. 97-9865, respondent represented Lumot A. Jalandoni and Totti Anlap Gargoles. This was a case for the recovery of possession of property involving Hotel Alhambra, a hotel owned by PRC. In BC I.S. No. 99-2192, Lim v. Vicente Delfin, Spouses Dennis and Carmen Jalbuena, respondent was counsel for Delfin and the spouses Jalbuena. In this case, plaintiff Cristina Lim sued the spouses Jalbuena and Delfin on the basis of two checks issued by PRC for the construction of Hotel Alhambra.[26] The corporate records allegedly reflected that the contractor, AAQ Sales and Construction (AAQSC), was already paid in full yet Amy Albert Que of AAQSC still filed a collection case against PRC for an unpaid balance. [27] In her complaint-affidavit, Cristina averred:

11. That it was respondent Carmen J. Jalbuena, who took advantage of [her] signatures in blank in DBP Check Nos. 0865590 and 0865591, and who filled up the spaces of the payee, date and amount without the knowledge and consent of any officer of the corporation and [herself], after which she caused the delivery of the same checks to her husband Dennis Jalbuena, who encashed without [their] knowledge and consent, and received the proceeds of the same checks (as evidenced by his signature in receipt of payment on the dorsal side of the said checks) with the indispensable participation and cooperation of respondent Vicente B. Delfin, the Asst. Vice President and Branch Head of UCPB.[28] Notably, in his comment, respondent stated: There was a possibility of conflict of interest because by this time, or one month before [he] filed [his] Motion to Withdraw, Mrs. Jalandoni /Penta Resorts Corporation, Mr. Lim, through his wife, Cristina J. Lim, by another counsel, Atty. Lorenzo S. Alminaza, filed a criminal complaint against the spouses Dennis and Carmen J. Jalbuena on March 26, 1999 under BC-I.S. Case No. 99-2192.[29]

Similarly, in BC I.S. Nos. 00-1370, 2000-2304, 2000-2343, 00-2125, 00-2230, 00-880, respondent positioned himself against PRCs interests. And, in Civil Case No. 99-10660, a collection case against PRC, Atty. Alminaza of PRC was alarmed by the appearance of respondent at the table in court for AAQSCs counsel.[30] Canon 15 of the Code of Professional Responsibility (CPR) highlights the need for candor, fairness and loyalty in all the dealings of lawyers with their clients. Rule 15.03 of the CPR aptly provides: Rule 15.03 A lawyer shall not represent conflicting interests except by written consent of all concerned given after a full disclosure of the facts. It is only upon strict compliance with the condition of full disclosure of facts that a lawyer may appear against his client; otherwise, his representation of conflicting interests is reprehensible.[31] Conflict of interest may be determined in this manner: There is representation of conflicting interests if the acceptance of the new retainer will require the attorney to do anything which will injuriously affect his first client in any matter in which he represents him and also whether he will be called upon in his new relation, to use against his first client any knowledge acquired through their connection.[32](emphasis ours) The rule on conflict of interests covers not only cases in which confidential communications have been confided but also those in which no confidence has been bestowed or will be used.[33] Another test of the inconsistency of interests is whether the acceptance of a new relation will prevent an attorney from the full discharge of his duty of undivided fidelity and loyalty to his client or invite suspicion of unfaithfulness

or double-dealing in the performance thereof, and also whether he will be called upon in his new relation to use against his first client any knowledge acquire in the previous employment. The first part of the rule refers to cases in which the opposing parties are present clients either in the same action or in a totally unrelated case; the second part pertains to those in which the adverse party against whom the attorney appears is his former client in a matter which is related, directly or indirectly, to the present controversy.[34] (emphasis ours)

The rule prohibits a lawyer from representing new clients whose interests oppose those of a former client in any manner, whether or not they are parties in the same action or in totally unrelated cases. The cases here directly or indirectly involved the parties connection to PRC, even if neither PRC nor Lumot A. Jalandoni was specifically named as party-litigant in some of the cases mentioned. An attorney owes to his client undivided allegiance. After being retained and receiving the confidences of the client, he cannot, without the free and intelligent consent of his client, act both for his client and for one whose interest is adverse to, or conflicting with that of his client in the same general matter. The prohibition stands even if the adverse interest is very slight; neither is it material that the intention and motive of the attorney may have been honest.[35] (emphasis ours) The representation by a lawyer of conflicting interests, in the absence of the written consent of all parties concerned after a full disclosure of the facts, constitutes professional misconduct which subjects the lawyer to disciplinary action.[36] Even respondents alleged effort to settle the existing controversy among the family members[37] was improper because the written consent of all concerned was still required. [38] A lawyer who acts as such in settling a dispute cannot represent any of the parties to it.
[39]

WITHDRAWAL AS COUNSEL IN CIVIL CASE NO. 97-9865 The next bone of contention was the propriety of respondents withdrawal as counsel for Lumot A. Jalandoni in Civil Case No. 97-9865 to fulfill an alleged retainership agreement with the spouses Jalbuena in a suit by PRC, through Cristina Lim, against the Jalbuenas and Delfin (BC I.S. No. 99-2192). In his December 1, 2000 comment, respondent stated that it was he who was not notified of the hiring of Atty. Alminaza as the new counsel in that case and that he withdrew from the case with the knowledge of Lumot A. Jalandoni and with leave of court. The rule on termination of attorney-client relations may be summarized as follows: The relation of attorney and client may be terminated by the client, by the lawyer or by the court, or by reason of circumstances beyond the control of the client or the lawyer. The termination of the attorney-client relationship entails certain duties on the part of the client and his lawyer.[40]

Accordingly, it has been held that the right of an attorney to withdraw or terminate the relation other than for sufficient cause is considerably restricted. Canon 22 of the CPR reads: Canon 22 A lawyer shall withdraw his services only for good cause and upon notice appropriate in the circumstances. An attorney may only retire from a case either by written consent of his client or by permission of the court after due notice and hearing, in which event the attorney should see to it that the name of the new lawyer is recorded in the case. [41] A lawyer who desires to retire from an action without the written consent of his client must file a petition for withdrawal in court.[42] He must serve a copy of his petition upon his client and the adverse party at least three days before the date set for hearing, otherwise the court may treat the application as a mere scrap of paper.[43] Respondent made no such move. He admitted that he withdrew as counsel on April 26, 1999, which withdrawal was supposedly approved by the court on April 28, 1999. The conformity of Mrs. Jalandoni was only presumed by Atty. Villarosa because of the appearance of Atty. Alminaza in court, supposedly in his place. [A client] may discharge his attorney at any time with or without cause and thereafter employ another lawyer who may then enter his appearance. Thus, it has been held that a client is free to change his counsel in a pending case and thereafter retain another lawyer to represent him. That manner of changing a lawyer does not need the consent of the lawyer to be dismissed. Nor does it require approval of the court.[44] The appearance of Atty. Alminaza in fact was not even to substitute for respondent but to act as additional counsel.[45] Mrs. Jalandonis conformity to having an additional lawyer did not necessarily mean conformity to respondents desire to withdraw as counsel. Respondents speculations on the professional relationship of Atty. Alminaza and Mrs. Jalandoni find no support in the records of this case. Respondent should not have presumed that his motion to withdraw as counsel[46] would be granted by the court. Yet, he stopped appearing as Mrs. Jalandonis counsel beginning April 28, 1999, the first hearing date. No order from the court was shown to have actually granted his motion for withdrawal. Only an order dated June 4, 1999 had a semblance of granting his motion: When this case was called for hearing Atty. Lorenzo Alminaza appeared for the defendants considering that Atty. Nicanor Villarosa has already withdrawn his appearance in this case which the Court considered it to be approved as it bears the conformity of the defendants.[47] (emphasis ours) That Mrs. Jalandoni continued with Atty. Alminazas professional engagement on her behalf despite respondents withdrawal did not absolve the latter of the consequences of his unprofessional conduct, specially in view of the conflicting interests already discussed. Respondent himself stated that his withdrawal from Civil Case No. 97-9865 was due to the possibility of a conflict of interest.[48] Be that as it may, the records do not support the claim that respondent improperly collected P5,000 from petitioner. Undoubtedly, respondent provided professional services to Lumot A. Jalandoni. Furthermore, there is no evidence that the documents belonging to Mrs.

Jalandoni were deliberately withheld. The right of an attorney to retain possession of a clients documents, money or other property which may have lawfully come into his possession in his professional capacity, until his lawful fees and disbursements have been fully paid, is well-established.[49] Finally, we express our utter dismay with Lims apparent use of his wifes community tax certificate number in his complaint for disbarment against respondent. [50] This is not, however, the forum to discuss this lapse. WHEREFORE, in view of the foregoing, respondent Atty. Nicanor V. Villarosa is hereby found GUILTY of violating Canon 15 and Canon 22 of the Code of Professional Responsibility and is SUSPENDED from the practice of law for one (1) year, effective upon receipt of this decision, with a STERN WARNING that a repetition of the same or similar acts will be dealt with more severely. Let a copy of this resolution be entered into the records of respondent and furnished to the Office of the Clerk of Court, the Office of the Bar Confidant, the Integrated Bar of the Philippines, and all courts in the Philippines, for their information and guidance.

FIRST DIVISION

FEL ICIT AS S. QUIAM BAO, C ompl ai na nt,

Ad m. Cas e No . 6 70 8 (CB D C ase N o. 0 1-8 74 )

Present:

DAVIDE, JR., C.J., (Chairman), - versus QUISUMBING, SANTIAGO, CARPIO, and AZCUNA, JJ.

ATTY. N ESTOR A. BAM BA , Respondent.

Promulgated:

August 25, 2005

X- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -X

RESOLU TION

DAVIDE, JR., C.J.:

W e are aw are of the hapl e ss fac t that the re are not e nough l aw ye rs to se rve an expl odi n g popul a ti on. Thi s unfortun ate state of affai rs, how e ve r, w i ll not se i ze thi s C ourt from e xe rc i si ng i ts di sc i pl i nary pow e r ove r l aw ye rs c ul pabl e of se ri ous i ndi sc re ti ons. The i nc i de nc e of publ i c forc e must be de pl oye d to be ar upon the c ommuni t y to e ve ntual l y forge a l e gal profe ssi on that provi de s qual i ty, e thi c al, ac ce ssi bl e , and c ost-e ffe c ti ve l e gal se rvi ce to our pe opl e and w hose me mbe rs are wi l l i ng and abl e to answ e r the c al l to publ i c se rvi ce .

I n thi s admi ni stra ti ve c ase for di sbarme nt, c ompl ai na nt Fe li c i tas S. Q ui ambao c harge s re sponde nt Atty. Ne stor A. B amba wi th vi ol ati on of the C ode of Profe ssi onal Re sponsi bi l i ty for re pre se nti ng c onfl i c ti ng i nte re sts w he n the l atte r fi l e d a c ase agai nst he r w hi le he w as at that ti me re pre se nti ng he r i n anothe r c ase , and for c ommi tti ng othe r ac ts of di sl oyal ty and doubl e - de al i ng.

F rom J une 20 00 to J anuary 20 01 , the c ompl ai nant w as the pre si de nt and managi n g di re c tor of Al li e d Inve sti gati on B ure au, I nc . (AIB ), a fami l yow ne d c orporati on e ngage d i n provi di ng se c uri ty and i nve sti gati on se rvi ce s. She ave rs that she proc ure d the l e gal se rvi ce s of the re sponde nt not onl y for the c orporate affai rs of AI B but al so for he r pe rsonal c ase . Parti c ul arl y, the re sponde nt ac te d as he r c ounse l of re c ord i n an e je c tme nt c ase agai nst Spouse s Santi ago and Fl ori ta Torroba fi le d by he r on 2 9 De ce mbe r 2 00 0 be fore the Me tropol i tan Tri al C ourt (Me TC ) of Paraaq ue C i ty, w hi c h w as doc k e te d as C i vi l C ase N o. 1 19 28 . She pai d attorne y s fe e s for re spon de nt s l e gal se rvi ce s i n that c ase . [ 1 ] Abou t si x months afte r she re si gne d as AI B pre si de nt, or on 1 4 J une 20 01 , the re sponde nt fi le d on be hal f of AI B a c ompl ai nt for re pl e vi n and damage s agai nst he r be fore the Me TC of Q ue zon C i ty for the purpose of re c ove ri ng from he r the c ar of AI B assi gne d to he r as a se rvi ce ve hi c le . Thi s he di d wi thout wi thdraw i ng as c ounse l of re c ord i n the e je c tme nt c ase , w hi c h w as the n sti l l pe ndi ng. [ 2 ]

Apart from the fore goi ng l i ti gati on matte r, the c ompl ai na nt, i n he r Posi ti on Pape r, c harge s the re sponde n t w i th ac ts of di sl oyal ty and doubl e -

de al i ng. She ave rs that the re sponde nt propose d to he r that she organi ze he r ow n se c uri ty age nc y and that he w oul d assi st he r i n i ts organi z ati on, c ausi ng he r to re si gn as pre si de nt of AI B . The re spon de nt i nde e d assi ste d he r i n De c e mbe r 20 00 i n the formati on of anothe r se c uri ty age nc y, Q ui ambao Ri sk Manage me nt Spe c i al i sts, I nc . , (Q RMSI ), w hi c h w as l ate r re gi ste re d unde r c ompl ai na nt s name , w i th the re sponde nt as a si l e nt partne r re pre se nte d by hi s assoc i ate Atty. Ge rardo P. He rnande z. The re spon de nt w as pai d attorne y s fe e s for hi s l e gal se rvi ce s i n organi zi n g and i nc orporati n g Q RMSI . He al so pl anne d to ste al or pi rate some of the more i mportant c l ie nts of AI B . W hil e se rvi ng as le gal c ounse l for AIB and a sil e nt partne r of Q RMSI , he c onvi nc e d c ompl ai nant s brothe r L e ode gari o Q ui ambao to organi ze anothe r se c uri ty age nc y, San Este ban Se c uri ty Se rvi ce s, I nc. (SESSI ) w he re he (the re spon de nt) se rve d as i ts i nc orporator, di re c tor, and pre si de nt. The re sponde nt and L e ode gari o the n il le gal l y di ve rte d the fund s of AIB to fund the i nc orporati o n of SESSI , and li k ew i se pl anne d to eve ntual l y cl ose dow n the ope rati ons of AI B and transfe r the busi ne ss to SESSI . [ 3 ]

F or hi s part, the re sponde nt admi ts that he re pre se nte d the c ompl ai na nt i n the afore me nti one d ej e c tme nt c ase and l ate r re pre se nte d AIB i n the re ple vi n c ase agai nst he r. He, how e ve r, de ni e s that he w as the pe rsonal l aw ye r of the c ompl ai nant, and ave rs that he w as made to be l ie ve that i t w as part of hi s func ti on as c ounse l for AI B to handl e e ve n the pe rsonal c ase s of i ts offi c e rs. Eve n assumi ng that the c ompl ai nant c onfi de d to hi m pri vi le ge d i nformati o n about he r le gal i nte re sts, the e je c tme nt c ase and the re ple vi n c ase are unre l ate d c ase s i nvol vi ng di ffe re nt i ssue s and parti e s and, the re fore , the pri vi le ge d i nformati on w hi c h mi ght have bee n gathe re d from one c ase w oul d have no use i n the othe r. At any rate , i t w as the c ompl ai na nt he rse l f w ho i nsi ste d that he stay as he r c ounse l de spi te the pe rc ei ve d di ffe re nc e s among he r, he r brothe r, and AI B ove r the motor ve hi c l e subj e c t of the re pl e vi n c ase . The c ompl ai na nt eve n aske d hi m to assi st he r i n he r mone tary c l ai ms agai nst AI B . [ 4 ]

The re sponde nt al so de nie s the c harge rai se d by the c ompl ai nan t i n he r posi ti on pape r that he agre e d to be a si le nt partne r of Q RMSI through hi s nomi ne e , Atty. Ge rardo P. He rnande z, w ho w as hi s forme r l aw partne r. He de c l i ne d c ompl ai nan t s offe r to assume that rol e and sugge ste d Atty. He rnande z i n hi s pl ac e ; thus, 3 75 share s of stoc k w e re re gi ste re d i n Atty. He rnande z s name as c onsi de rati on of hi s (Atty. He rnande z s) l e gal se rvi c e s as c orporate se c re tary and le gal c ounse l of Q RMSI . The re sponde nt al so de ni e s that he c onvi nc e d c ompl ai nan t s brothe r Le ode gari o to organi ze anothe r se c uri ty age nc y and that the fund s of AIB w ere unl aw ful l y di ve rte d to SESSI . I t w as to c ompl e me nt the busi ne ss of AIB , w hi c h w as the n i n dange r of c ol l apse , that SESSI w as establ i she d. Le ode gari o s w i fe and he r son have the effe c ti ve c ontrol ove r SESSI . Re sponde nt s subsc ri be d share hol di ng s i n SESSI c ompri se onl y 80 0 share s out of 1 2, 50 0 subsc ri be d share s. He se rve s AI B and SES SI i n di ffe re nt c apac i ti e s: as l e gal c ounse l of the forme r and as pre si de nt of the l atte r. [ 5 ]

I n hi s Re port and Re c omme ndati on [ 6 ] date d 31 Augus t 2 00 4, the i nve sti gati ng c ommi ssi one r of the I B P foun d the re sponde n t gui l ty of

re pre se nti ng c onfl i c ti ng i nte re sts base d on the fol l ow i ng undi spu te d fac ts: fi rst, the re sponde nt w as sti l l c ompl ai nan t s c ounse l of re c ord i n the e je c tme nt c ase w he n he fil e d, as le gal c ounse l of AIB , the re pl e vi n c ase agai nst he r; and se c ond, the re sponde nt w as sti l l the l e gal c ounse l of AIB w he n he advi se d the c ompl ai na nt on the i nc orpora ti on of anothe r se c uri ty age nc y, Q RMSI , and re c omme nde d hi s forme r l aw partne r, Atty. Ge rardo He rnande z, to be i ts c orporate se c re tary and le gal c ounse l and al so w he n he c onfe rre d wi th L e ode gari o to organi ze anothe r se c uri ty age nc y, SESSI , w he re the re sponde nt be c ame an i nc orporator, stoc k hol de r, and pre si de nt. Thus, the i nve sti gati ng c ommi ssi one r re c omme nde d that the re sponde n t be suspe nde d from the prac ti c e of l aw for one ye ar.

The IB P B oard of Gove rnors adopte d and appro ve d the i nve sti gati ng c ommi ssi one r s re port and re c omme ndati o n, but re duc e d the pe nal ty from one ye ar to a ste rn re pri mand. [ 7 ]

The issue i n thi s c ase i s w he the r the re sponde nt i s gui l ty of mi sc onduc t for re pre se nti ng c onfl i c ti ng i nte re sts i n c ontrave nti on of the basi c te ne ts of the l e gal profe ssi on.

Rul e 15 .0 3 , C anon 5 of the C ode of Profe ssi onal Re sponsi bi l i ty provi de s: A l aw ye r shal l not re pre se nt c onfl i c ti ng i nte re sts exc e pt by w ri tte n c onse nt of al l c onc e rne d gi ve n afte r a ful l di sc l osure of the fac ts. Thi s prohi bi ti on is founde d on pri nc i pl e s of publ i c pol i c y and good taste . [ 8 ] In the c ourse of a l aw ye r-c l ie nt re l ati onshi p, the l aw ye r l e arns all the fac ts c onne c te d wi th the cl i e nt s c ase, i nc l udi ng the w e ak and strong poi nts of the c ase . The nature of that rel ati onshi p is, the re fore, one of trust and c onfi de nc e of the hi ghe st de gre e. [ 9 ] I t be hoove s l aw ye rs not onl y to k ee p i nvi ol ate the c li e nt s c onfi de nc e , but al so to avoi d the appe aranc e of tre ac he ry and doubl e - de al i ng for onl y the n c an l i ti gants be e nc ourage d to e ntrust the i r se c re ts to the i r l aw ye rs, w hi c h i s of paramou nt i mporta nc e i n the admi ni stra ti on of j usti c e . [ 1 0 ]

I n broad te rms, l aw ye rs are dee me d to re pre se nt c onfl i c ti ng i nte re sts w he n, i n be hal f of one c l ie nt, i t i s thei r duty to c onte nd for that w hi c h duty to anothe r c l ie nt re qui re s the m to oppose . [ 1 1 ] De ve l opme nts i n j uri sprude nc e have parti c ul ari ze d vari ous te sts to de te rmi ne w he the r a l aw ye r s c onduc t l ie s wi thi n thi s prosc ri pti on. O ne te st i s w he the r a l aw ye r i s duty- bound to fi ght for an i ssue or c l ai m i n be hal f of one c l ie nt and, at the same ti me , to oppose that c l ai m for the othe r c l ie nt. [ 1 2 ] Thus, if a l aw ye r s argume nt for one c l ie nt has to be oppose d by that same l aw ye r i n argui ng for the othe r c l ie nt, the re i s a vi ol ati on of the rul e.

Anothe r te st of i nc onsi ste nc y of i nte re sts i s w he the r the ac c e ptanc e of a new re l ati on w oul d pre ve nt the ful l di sc harge of the l aw ye r s duty of

undi vi de d fi de l i ty and l oyal ty to the c l ie nt or i nvi te suspi c i on of unfai th ful ne ss or doubl e - de al i ng i n the pe rformanc e of that duty. [ 1 3 ] Sti l l anothe r te st i s w he the r the l aw ye r w oul d be c al l e d upon i n the ne w rel ati on to use agai nst a forme r cl i e nt any c onfi de nti al i nformati o n ac qui re d through the i r c onne c ti on or pre vi ous e mpl oyme nt. [ 1 4 ]

The prosc ri pti on agai nst re pre se ntati on of c onfl i c ti ng i nte re sts appl i e s to a si tuati on w he re the opposi n g parti e s are pre se nt cl i e nts i n the same ac ti on or i n an unre l ate d ac ti on. It i s of no mome nt that the l aw ye r w oul d not be c all e d upon to c onte nd for one cl i e nt that w hi c h the l aw ye r has to oppose for the othe r c l ie nt, or that the re w oul d be no oc c asi on to use the c onfi de nti al i nformati on ac qui re d from one to the di sadvant age of the othe r as the tw o ac ti ons are w hol l y unre l ate d. I t i s e nough that the opposi ng parti e s i n one c ase, one of w hom w oul d l ose the sui t, are pre se nt cl i e nts and the nature or c ondi ti ons of the l aw ye r s re spe c ti ve re tai ne rs w i th e ac h of the m w oul d affe c t the pe rformanc e of the duty of undi vi de d fi de l i ty to both c l ie nts. [ 1 5 ]

I n thi s c ase , i t i s undi spu te d that at the ti me the re sponde n t fil e d the re pl e vi n c ase on be hal f of AI B he w as sti ll the c ounse l of re c ord of the c ompl ai na nt i n the pe ndi ng e je c tme nt c ase . W e do not sustai n re sponde nt s the ory that si nc e the ej e c tme nt c ase and the re pl e vi n c ase are unre l ate d c ase s fraugh t wi th di ffe re nt i ssue s, parti e s, and subj e c t matte rs, the prohi bi ti o n i s i nappl i c a bl e . Hi s re pre se ntati on of opposi n g cl i e nts i n both c ase s, thoug h unre l ate d, obvi ousl y c onsti tute s c onfl i c t of i nte re st or, at the l e ast, i nvi te s suspi c i on of doubl e - de al i ng. W hil e the re sponde nt may asse rt that the c ompl ai na nt expre ssl y c onse nte d to hi s c onti nue d re pre se ntati on i n the ej ec tme nt c ase , the re spon de nt fai l e d to show that he ful l y di sc l ose d the fac ts to both hi s c l ie nts and he fai l e d to pre se nt any wri tte n c onse nt of the c ompl ai na nt and AI B as re qui re d unde r Rul e 1 5. 03 , C anon 15 of the C ode of Profe ssi onal Re sponsi bi l i ty.

Ne i the r c an w e ac ce pt re sponde nt s pl e a that he w as duty- boun d to handl e al l the c ase s re fe rre d to hi m by AI B, i ncl udi n g the pe rsonal c ase s of i ts offi c e rs w hi c h had no c onne c ti on to i ts c orporate affai rs. That the re pre se ntati on of c onfl i c ti ng i nte re st i s i n good fai th and wi th hone st i nte nti on on the part of the l aw ye r doe s not mak e the prohi bi ti on i nope rati ve . [16] More ove r, l aw ye rs are not obl i ge d to ac t ei the r as an advi se r or advoc ate for e ve ry pe rson w ho may wi sh to be c ome thei r c l ie nt. The y have the ri ght to de c l i ne suc h e mpl oyme nt, subj e c t, how e ve r, to C anon 14 of the C ode of Profe ssi onal Re sponsi bi l i ty. [ 1 7 ] Al though the re are i nstanc e s w he re l aw ye rs c annot de cl i ne re pre se ntati on, [ 1 8 ] the y c annot be made to l abor unde r c onfl i c t of i nte re st be twe e n a pre se nt c l ie nt and a prospe c ti ve one . [ 1 9 ]

Addi ti o nal l y, i n hi s posi ti on pape r, the re sponde nt all e ge s that w he n the c ompl ai na nt i nvi te d the re sponde nt to j oi n Q RMSI , he ve he me ntl y re fuse d to j oi n the m due to hi s pe rc e pti on of co nf lict ing int e re st as he w as the n (and stil l i s at pre se nt) the L e gal C ounse l of AI B, w hi c h i s al so a

se c uri ty age nc y. [ 2 0 ] To bol ste r hi s al le gati on, he i nvok e d the affi davi ts of c ompl ai na nt s w i tne sse s w hi c h c ontai ne d state me nts of hi s appre he nsi on of c onfl i c t of i nte re st shoul d he j oi n Q RMSI . [ 2 1 ]

Surpri si ngl y, de spi te hi s appre he nsi on or aw are ne ss of a possi bl e c onfl i c t of i nte re st shoul d he j oi n Q RMSI , the re sponde n t l ate r al l ow e d hi mse l f to be c ome an i nc orporator, stoc k hol de r, and pre si de nt of SESSI , w hi c h i s al so a se c uri ty age nc y. He j usti fi e d hi s ac t by c l ai mi ng that that w hi le both AI B and SES SI are e ngage d i n se c uri ty age nc y busi ne ss, he i s se rvi ng i n di ffe re nt c apac i ti e s. As the i n-house l e gal c ounse l of AIB , he se rve s i ts l e gal i nte re st the parame te r of w hi c h e vol ve s aroun d le gal matte rs suc h as prote c ti ng the l e gal ri ghts and i nte re st of the c orporati on; c onduc ti ng an i nve sti gati on or a he ari ng on vi ol ati ons of c ompa ny rul e s and re gul ati ons of the i r offi c e empl oye e s and se c uri ty guards; se ndi ng de mand l e tte rs i n c ol l e c ti on c ase s; and re pre se nti ng the c orporati o n i n any l i ti gati on for or agai nst i t. And as pre si de nt of SESSI , he se rve s the ope rati onal aspe c ts of the busi ne ss suc h as how doe s i t ope rate [], how muc h do the y pri c e the i r se rvi c e s, w hat ki nd or how do the y trai n[] the i r se c uri ty guards, how the y sol i c i t c l ie nts. Thus, c onfl i c t of i nte re st i s far-fe tc he d. More ove r, the re sponde n t argue s that the c ompl ai na nt, not bei ng a stoc k hol de r of AIB and SESSI , has no ri ght to que sti on hi s al l e ge d c onfl i c t of i nte re st i n se rvi ng the tw o se c uri ty age nc i e s. [ 2 2 ]

W hil e the c ompl ai nant l ac k s pe rsonal i ty to que sti on the al le ge d c onfl i c t of i nte re sts on the part of the re sponde nt i n se rvi ng both se c uri ty age nc i e s, we c annot j ust turn a bl i nd e ye to re sponde nt s ac t. I t must be note d that the prosc ri pti on agai nst re pre se ntati on of c onfl i c ti ng i nte re sts fi nds appl i c ati on w he re the c onfl i c ti ng i nte re sts ari se w i th re spe c t to the same ge ne ral matte r howe ve r sli ght the adve rse i nte re st may be . I t appl i e s e ve n i f the c onfl i c t pe rtai ns to the l aw ye r s pri vate ac ti vi ty or i n the pe rformanc e of a func ti on i n a non- profe ssi onal c apac i ty. [ 2 3 ] I n the proc e ss of de te rmi ni ng w he the r the re i s a c onfl i c t of i nte re st, an i mportan t c ri te ri on is proba bi l i ty, not c e rtai nty, of c onfl i c t.

Si nc e the re sponde nt has fi nanc i al or pe c uni ary i nte re st i n SES SI , w hi c h i s e ngage d i n a busi ne ss c ompe ti ng w i th hi s c l ie nt s, and, more i mporta ntl y, he oc c upi e s the hi ghe st posi ti on i n SESSI , one c annot hel p e nte rtai ni ng a doubt on hi s loyal ty to hi s c l ie nt AI B . Thi s ki nd of si tuati on passe s the se c ond te st of c onfl i c t of i nte re st, w hi c h is w he the r the ac c e ptanc e of a ne w re l ati onshi p w oul d pre ve nt the ful l di sc harge of the l aw ye r s duty of undi vi de d fi del i ty and l oyal ty to the cl i e nt or i nvi te suspi c i on of unfai thf ul ne ss or doubl e - de ali ng i n the pe rformanc e of that duty. The c l ose rel ati onshi p of the maj ori ty stoc k hol de rs of both c ompani e s doe s not ne gate the c onfl i c t of i nte re st. N ei the r doe s hi s prote stati on that hi s share hol di n g i n SESSI i s a me re pe bbl e amon g the sands.

I n vi e w of al l of the fore goi ng, we fi nd the re sponde n t gui l ty of se ri ous mi sc ond uc t for re pre se nti ng c onfl i c ti ng i nte re sts.

F urthe rmore , i t must be note d that Re publ i c Ac t N o. 5 48 7, othe rwi se k now n as the Pri vate Se c uri ty Age nc y L aw , prohi bi ts a pe rson from organi zi ng or havi ng an i nte re st i n more than one se c uri ty age nc y. From re sponde nt s posi ti on pape r, i t c an be c ul le d that L e ode gari o Q ui ambao is the pre si de nt and mana gi ng di re c tor of AIB , hol di ng 60 % of the outstan di ng share s; w hi l e hi s four othe r si bl i ngs w ho are pe rmane nt re si de nts i n the Uni te d State s ow n the re mai ni ng 4 0%. [ 2 4 ] Thi s prohi bi ti o n notw i thsta ndi ng, the re sponde nt organi ze d SESSI , w i th Le ode gari o s w i fe and son as maj ori ty stoc k hol de rs hol di ng about 70 % of the outsta ndi n g share s and wi th hi m (the re sponde nt), as we l l as the re st of the stoc k hol de rs, hol di ng mi ni mal share s. [ 2 5 ] I n doi ng so, the re sponde nt vi rtual l y al l ow e d Le ode gari o and the l atte r s w i fe to vi ol ate or c i rc umve nt the l aw by havi ng an i nte re st i n more than one se c uri ty age nc y. It must be note d that i n the affi davi t [ 2 6 ] of Le ode gari o s wi fe , she me nti one d of the i r c onj ugal prope rty. In the abse nc e of e vi de nc e to the c ontrary, the prope rty re l ati on of Le ode gari o and hi s wi fe c an be pre sume d to be that of c onj ugal partne rshi p of gai ns; he nc e , the maj ori ty share s i n AI B and SESSI are the c onj ugal prope rty of Le ode gari o and hi s wi fe, the re by pl ac i ng the mse l ve s i n posse ssi on of an i nte re st i n more than one se c uri ty age nc y i n c ontrave nti on of R. A. N o. 5 48 7. Thus, i n organi zi ng SESSI , the re sponde nt vi ol ate d Rul e 1 .0 2 , C anon 1 of the C ode of Profe ssi onal Re sponsi bi l i ty, w hi c h manda te s l aw ye rs to promo te re spe c t for the l aw and re frai n from c ounse l i ng or abe tti ng ac ti vi tie s ai me d at de fi anc e of the l aw .

As to the re c omme ndati on that the pe nal ty be re duc e d from a suspe nsi on of one ye ar to a ste rn w arni ng, w e fi nd the same to be w i thout basi s. W e are di sturbe d by the re duc ti on made by the IB P B oard of Gove rnors of the pe nal ty re c omme nde d by the i nve sti gati ng c ommi ssi one r w i thout cl e arl y and di sti nc tl y stati ng the fac ts and re asons on w hi c h that re duc ti on i s base d.

Se c ti on 12 (a), Rul e 13 9 -B of the Rul e s of C ourt re ads i n part as fol l ow s:

SEC . 1 2. Re vi ew and de c i si on by the B oard of Gove rnors .

(a) Eve ry c ase he ard by an i nve sti gator shal l be re vi ew e d by the IB P B oard of Gove rnors upon the re c ord and e vi de nc e transmi t te d to i t by the I nve sti gator wi th hi s re port. The de c i si on of the B oard upon suc h re vie w shal l be i n w ri ti ng and shal l c le arl y and di sti nc tl y state the fac ts and the re asons on w hi c h i t i s base d.

W e may c onsi de r the re sol uti on of the IB P Board of Gove rnors as a me moran dum de c i si on adopti ng by re fe re nc e the re port of the i nve sti gati ng c ommi ssi one r. How e ve r, w e l ook w i th di sfavor the c hange i n the re c omme nde d pe nal ty wi thout any e xpl anati on the re for. Agai n, we re mi nd the IB P B oard of Gove rnors of the i mporta nc e of the re qui re me nt to annou nc e i n pl ai n te rms i ts le gal re asoni ng, si nce the re qui re me nt that i ts de c i si on i n di sc i pl i nary proc e e di ngs must state the fac ts and the re asons on w hi c h i ts de c i si on i s base d i s ak i n to w hat i s re qui re d of the de c i si ons of c ourts of re c ord. [ 2 7 ] The re asons for handi ng dow n a pe nal ty oc c upy no le sse r stati on than any othe r porti on of the rati o.

I n si mi l ar c ase s w he re the re sponde nt w as foun d gui l ty of re pre se nti ng c onfl i c ti ng i nte re sts a pe nal ty rangi n g from one to three ye ars suspe nsi on w as i mpose d. [ 2 8 ] In thi s c ase , w e fi nd that a suspe nsi on from the prac ti c e of l aw for one ye ar is w arrante d.

WH EREFORE , re sponde nt Atty. N estor A. Bamba is he re by he l d GUIL TY of vi ol ati on of Rul e 15 .0 3 of C anon 1 5 and Rul e 1 .0 2 of C anon 1 of the C ode of Profe ssi onal Re sponsi bi l i ty. He i s SUSPEN DED from the prac ti c e of l aw for a pe ri od of ON E (1 ) YEAR effe c ti ve from re ce i pt of thi s Re sol uti on, w i th a w arni ng that a si mi l ar i nfrac ti on i n the future shal l be de al t w i th more se ve re l y. L e t c opie s of thi s Re sol uti on be furni she d to the O ffi c e of the B ar C onfi dan t and the I nte grate d B ar of the Phi l i ppi ne s.

A.C. No. 4354

April 22, 2002

LOLITA ARTEZUELA, complainant, vs. ATTY. RICARTE B. MADERAZO, respondent. PUNO, J.: For his failure to meet the exacting standards of professional ethics, the Board of Governors of the Integrated Bar of the Philippines (IBP) in its Resolution of May 2, 2000 recommended the suspension from the practice of law of respondent Atty. Ricarte B. Maderazo for the period of six (6) months, with a stern warning that repetition of the same act will be dealt with more severely. Respondent allegedly represented conflicting interests in violation of Canon 6 of the Code of Professional Ethics, and Canon 15 and Rule 15.03 of the Code of Professional Responsibility.1 By way of a Motion for Reconsideration,2 respondent now comes before this Court to challenge the basis of the IBP's resolution, and prays for its reversal. The factual antecedents of the case are as follows: On or about 3:00 in the early morning of December 24, 1992, Allan Echavia had a vehicular accident at Caduman St., corner H. Abellana St., Mandaue City. At the time of the accident, Echavia was driving a Ford Telstar

car owned by a Japanese national named Hirometsi Kiyami, but was registered in the name of his brother-in-law, Jun Anthony Villapez. The car rammed into a small carinderia owned by complainant Lolita Artezuela.3 The destruction of the complainant's carinderia caused the cessation of the operation of her small business, resulting to her financial dislocation. She incurred debts from her relatives and due to financial constraints, stopped sending her two children to college.4 Complainant engaged the services of the respondent in filing a damage suit against Echavia, Villapez and one Bernardo Sia.5 Docketed as Civil Case No. 13666, the case was assigned to Branch 14 of the Regional Trial Court of Cebu. An Amended Complaint was thereafter filed, impleading Echavia, Kiyami and Villapez, and dropping Sia as a party-defendant.6 For his services, complainant paid the respondent the amount of Ten Thousand Pesos (P10,000.00) as attorney's fees and Two Thousand Pesos (P2,000.00) as filing fee.7 However, the case was dismissed on March 22, 1994, allegedly upon the instance of the complainant and her husband.8 Because of the dismissal of Civil Case No. 13666, complainant filed a civil case for damages against the respondent. It was docketed as CEB-18552 and assigned to Branch 57, Regional Trial Court of Cebu City. The case was dismissed on June 12, 2001.9 On November 24, 1994, Artezuela filed before this Court a verified complaint for disbarment against the respondent. She alleged that respondent grossly neglected his duties as a lawyer and failed to represent her interests with zeal and enthusiasm. According to her, when Civil Case No. 13666 was scheduled for pre-trial conference on August 20, 1993, respondent asked for its postponement although all the parties were present. Notwithstanding complainant's persistent and repeated follow-up, respondent did not do anything to keep the case moving. He withdrew as counsel without obtaining complainant's consent.10 Complainant also claimed that respondent engaged in activities inimical to her interests. While acting as her counsel, respondent prepared Echavia's Answer to the Amended Complaint. The said document was even printed in respondent's office. Complainant further averred that it was respondent who sought the dismissal of the case, misleading the trial court into thinking that the dismissal was with her consent.11 Respondent denied the complainant's allegations and averred that he conscientiously did his part as the complainant's lawyer in Civil Case No. 13666. He withdrew as counsel because the complainant was uncooperative and refused to confer with him. He also gave several notices to the complainant and made known his intention before he filed his Manifestation to withdraw as counsel. Because of the severed relationship, the lower court, after holding a conference, decided to grant respondent's manifestation and advised the complainant to secure the services of a new lawyer. Complainant, however, refused and instead, sought the dismissal of the case.12 Respondent alleged that he sought the postponement of the Pre-Trial Conference scheduled on August 20, 1993 so that he could file the Amended Complaint. He admitted that Echavia's Answer to the Amended Complaint was printed in his office but denied having prepared the document and having acted as counsel of Echavia. He claimed that complainant requested him to prepare Echavia's Answer but he declined. Echavia, however, went back to his office and asked respondent's secretary to print the document. Respondent intimated that the complainant and Echavia have fabricated the accusations against him to compel him to pay the amount of P500,000.00.13

This Court referred the complaint to the Integrated Bar of the Philippines (IBP). The IBPVisayas Regional Committee on Bar Discipline formed an Investigating Committee to hear the disbarment complaint. On October 6, 1999, Commissioner Gabriel T. Ingles issued a Report finding the respondent guilty of representing conflicting interests, in violation of Canon 15 and Rule 15.03 of the Code of Professional Responsibility, as well as, of Canon 6 of the Code of Professional Ethics. He recommended that the respondent be suspended from the practice of law for a period of one (1) year.14 Commissioner Ingles did not rule on the other issues. As aforesaid, the Board of Governors of the Integrated Bar of the Philippines upheld the findings of the Committee with modification only as to the penalty. Seeking reconsideration of the IBP's resolution, respondent contends that the Investigating Committee did not conduct trial; hence, he was not able to confront and examine the witnesses against him. He argues that the Investigating Committee's finding that he represented Echavia is contrary to court records and the complainant's own testimony in CEB-18552. He also casts doubt on the credibility of the Investigating Committee to render just and fair recommendations considering that the Investigating Commissioner and the respondent are counsel-adversaries in another case, Civil Case No. R-33277. Finally, he questions the imposition of a six-month suspension, which he claims to be harsh considering that his private practice is his only source of income.15 After carefully examining the records, as well as the applicable laws and jurisprudence on the matter, this Court is inclined to uphold the IBP's resolution.1wphi1.nt In administrative cases, the requirement of notice and hearing does not connote full adversarial proceedings, as "actual adversarial proceedings become necessary only for clarification or when there is a need to propound searching questions to witnesses who give vague testimonies."16 Due process is fulfilled when the parties were given reasonable opportunity to be heard and to submit evidence in support of their arguments.17 In the case at bar, records show that respondent repeatedly sought the postponement of the hearings, prompting the Investigating Commissioner to receive complainant's evidence ex parte and to set the case for resolution after the parties have submitted their respective memorandum. Hence: "The records show that this is already the third postponement filed by respondent namely December 12, 1996 (sic), January 3, 1996 and April 1, 1996. The Commission for the last time, will cancel today's hearing and can no longer tolerate any further postponement. Notify respondent by telegram for the hearing for (sic) April 22, 1996 at 2:00 P.M. Said hearing is intransferable in character. In the meantime, complainant affirmed her complaint and likewise her witness, Allan Echavia, also affirmed the contents of his affidavit and further stated that he had executed the same and understood the contents thereof."18 It is by his own negligence that the respondent was deemed to have waived his right to cross-examine the complainant and her witness. He cannot belatedly ask this Court to grant new trial after he has squandered his opportunity to exercise his right.

Respondent's contention that the finding of the Investigating Committee was contrary to the records and the complainant's own admission in CEB-18552 is without merit. It is true that Atty. Aviola was Echavia's counsel-of-record in Civil Case No. 13666 as evidenced by the certification from the clerk of court,19 and as admitted by the complainant in CEB-18552, viz: "ATTY. MADERAZO: (To witness- ON CROSS) Q: Madam witness, you mentioned that the defendant in this case was the counsel of Allan Echavia as early as August 20, 1993, wherein you learned for the first time of this fact when you say he is counsel of Allan Echavia. (sic) You mean he is the counsel of record of Allan Echavia in the Civil Case before Judge Dacudao? Is that what you mean? A: What I learned was that Atty. Alviola was the counsel of Allan Echavia in the case before Judge Dacudao but I heard Atty. Maderazo telling Allan Echavia not to admit that Atty. Maderazo is appearing for me because he will be the one to coordinate with Allan's case. Q: So it is clear that the defendant in this case is not the counsel of record of Allan Echavia. It was Atty. Alviola stated by you now? A: Atty. Maderazo was not Allan Echavia's counsel but it was Atty. Alviola who was the counsel of record of Allan Echavia."20 Nevertheless, the issue in this case is not whether the respondent also acted as the counselof-record of Echavia. Rather, it is whether or not he had a direct hand in the preparation of Echavia's Answer to the Amended Complaint. To be guilty of representing conflicting interests, a counsel-of-record of one party need not also be counsel-of-record of the adverse party. He does not have to publicly hold himself as the counsel of the adverse party, nor make his efforts to advance the adverse party's conflicting interests of record--- although these circumstances are the most obvious and satisfactory proof of the charge. It is enough that the counsel of one party had a hand in the preparation of the pleading of the other party, claiming adverse and conflicting interests with that of his original client. To require that he also be counsel-of-record of the adverse party would punish only the most obvious form of deceit and reward, with impunity, the highest form of disloyalty. Canon 6 of the Code of Professional Ethics states: "It is the duty of a lawyer at the time of the retainer to disclose to the client the circumstances of his relations to the parties and any interest in or in connection with the controversy, which might influence the client in the selection of the counsel. "It is unprofessional to represent conflicting interests, except by express consent of all concerned given after a full disclosure of the facts. Within the meaning of this Canon, a lawyer represents conflicting interests when in behalf of one of the clients, it is his duty to contend for that which duty to another client requires him to oppose." (emphasis supplied) An attorney owes his client undivided allegiance. Because of the highly fiduciary nature of the attorney-client relationship, sound public policy dictates that a lawyer be prohibited from representing conflicting interests or discharging inconsistent duties. He may not, without

being guilty of professional misconduct, act as counsel for a person whose interest conflicts with that of his present or former client. Indeed, good faith and honest intention on the part of the erring lawyer does not make this rule inoperative.21 The lawyer is an officer of the court and his actions are governed by the uncompromising rules of professional ethics. Thus: "The relations of attorney and client is founded on principles of public policy, on good taste. The question is not necessarily one of the rights of the parties, but as to whether the attorney has adhered to proper professional standard. With these thoughts in mind, it behooves attorneys, like Ceasar's wife, not only to keep inviolate the client's confidence, but also to avoid the appearance of treachery and doubledealing. Only thus can litigants be encouraged to entrust their secrets to their attorneys which is of paramount importance in the administration of justice."22 The professional obligation of the lawyer to give his undivided attention and zeal for his client's cause is likewise demanded in the Code of Professional Responsibility. Inherently disadvantageous to his client's cause, representation by the lawyer of conflicting interests requires disclosure of all facts and consent of all the parties involved. Thus: "CANON 15- All lawyers shall observe candor, fairness and loyalty in all his dealings and transactions with his clients. xxx Rule 15.03- A lawyer shall not represent conflicting interests except by written consent of all concerned given after a full disclosure of the facts." While the Resolution of the IBP is purely recommendatory, we find no reason to reverse the same. In disciplinary proceedings against members of the bar, only clear preponderance of evidence is required to establish liability. As long as the evidence presented by complainant or that taken judicial notice of by the Court is more convincing and worthy of belief than that which is offered in opposition thereto, the imposition of disciplinary sanction is justified.23 A perusal of Echavia's Answer to the Amended Complaint shows that it indeed conflicts with the complainant's claims. It reads: "1. The allegations (sic) in Paragraph One (1) of the Complaint is admitted in so far as it pertains to the personal circumstance and residence of the answering defendant. The rest of the allegations in Paragraph One (1), and all the allegations in Paragraph Two (2) , THREE (3), FOUR (4), FIVE (5), SIX (6), ELEVEN (11), TWELVE (12), and FOURTEEN (14), of the Complaint are DENIED for lack of knowledge sufficient to form a belief as to the truth of such allegations."24 By way of prayer, Echavia states: "WHEREFORE, it is respectfully prayed that after hearing, judgment be rendered dismissing plaintiff's complaint."25 Anent the authorship by the respondent of the document quoted above, the Investigating Committee found the testimonies of the complainant and Echavia credible as opposed to respondent's bare denial. As pointed out by Echavia, he was approached by Atty. Maderazo, introduced himself as his lawyer and after some sessions in the latter's office, asked him to

return and sign a document which he later identified as the Answer to the Amended Complaint. The Investigating Committee found respondent's defense weak. Respondent did not bother to present his secretary as witness, nor obtain her affidavit to prove his allegations. Instead, he offered a convenient excuse--- that he cannot anymore locate his secretary. Respondent argued that it was the complainant who asked him to prepare Echavia's Answer to the Amended Complaint, after reaching an agreement whereby Echavia would testify in favor of the complainant. After he declined the request, he claimed that it was the complainant who prepared the document and asked his secretary to print the same. But as shown, Echavia's Answer to the Amended Complaint was in no way favorable to the complainant. With the dismissal of Civil Case No. 13666, Echavia is practically off the hook. We cannot find any reason why Echavia would commit perjury and entangle himself, once again, with the law. He does not stand to profit at all by accusing the respondent falsely. Furthermore, considering complainant's stature and lack of legal education, we can not see how she could have prepared Echavia's Answer to the Amended Complaint and device a legal maneuver as complicated as the present case. Respondent's attack on the credibility of Investigating Commissioner Ingles to render an impartial decision, having been an adversary in Civil Case No. R-33277, does not convince us to grant new trial. This is the first time that respondent questions the membership of Commissioner Ingles in the Investigating Committee. If respondent really believed in good faith that Commissioner Ingles would be biased and prejudiced, he should have asked for the latter's inhibition at the first instance. Moreover, we could not find any hint of irregularity, bias or prejudice in the conduct of the investigation that would lead us to set it aside. Finally, we remind the respondent that the practice of law is not a property right but a mere privilege, and as such, must bow to the inherent regulatory power of the Court to exact compliance with the lawyer's public responsibilities.26 The suspension of the respondent's privilege to practice law may result to financial woes. But as the guardian of the legal profession, we are constrained to balance this concern with the injury he caused to the very same profession he vowed to uphold with honesty and fairness.1wphi1.nt IN VIEW WHEREOF, the Resolution of the IBP finding the respondent guilty of violating Canon 6 of the Code of Professional Ethics, and Canon 15 and Rule 15.03 of the Code of Professional Responsibility is affirmed. Respondent is suspended from the practice of law for six (6) months with a stern warning that a similar act in the future shall be dealt with more severely. SO ORDERED. EN BANC

[A.C. No. 5948. January 22, 2003]

GAMALIEL ABAQUETA, complainant, vs. FLORIDO, respondent.

ATTY.

BERNARDITO

A.

RESOLUTION YNARES-SANTIAGO, J.: This is an administrative complaint[1] against Atty. Bernardito A. Florido filed with the Integrated Bar of the Philippines (IBP) Commission on Bar Discipline, praying that appropriate sanctions be imposed on respondent for representing conflicting interests. Complainant is a Filipino by birth who had acquired American citizenship. He resides at 15856 N. 15th Way, Phoenix, Arizona 85022, U.S.A. Respondent is a practicing lawyer based in Cebu City. On November 28, 1983, complainant engaged the professional services of respondent through his attorney-in-fact, Mrs. Charito Y. Baclig, to represent him in Special Proceedings No. 3971-R, entitled, In the Matter of the Intestate Estate of Deceased Bonifacia Abaqueta, [2] Susana Uy Trazo, petitioner before the Regional Trial court of Cebu.[3] Accordingly, respondent entered his appearance in Special Proceedings No. 3971-R as counsel for herein complainant.[4] Subsequently, he filed complainants Objections and Comments to Inventory and Accounting, registering complainants objection . . . to the inclusion of the properties under Items 1 to 5 contained in the inventory of the administratrix dated November 9, 1983. These properties are the sole and exclusive properties of the oppositor per the latest tax declarations already marked as Exhibits 2, 3, 4, 5 and 6 in the Formal Offer of Exhibits by oppositor in writing dated August 17, 1983 xxx.[5] Several years later, Milagros Yap Abaqueta filed an action for sum of money against complainant, docketed as Civil Case No. CEB-11453 and entitled, Milagros Yap Abaqueta vs. Gamaliel Abaqueta and Casiano Gerona.[6] Respondent signed the Complaint as counsel for plaintiff Milagros Yap Abaqueta, averring, inter alia, that: Plaintiff and defendant Gamaliel Abaqueta are the conjugal owners of those certain parcels of land, more particularly as follows The parcels of land referred to as conjugal property of complainant and Milagros YapAbaqueta are the very same parcels of land in Special Proceedings No. 3971-R which respondent, as lawyer of complainant, alleged as the sole and exclusive properties of complainant. In short, respondent lawyer made allegations in Civil Case No. CEB-11453 which were contrary to and in direct conflict with his averments as counsel for complainant in Special Proceedings No. 3971-R. Complainant further averred that respondent admitted he was never authorized by the former to appear as counsel for complainants ex-wife in Civil Case No. CEB-11453; that respondent failed to indicate in the Complaint the true and correct address of herein complainant, which respondent knew as far back as August 2, 1990, when he wrote a letter to the complainant at the said address.[7] Consequently, complainant failed to receive summons and was declared in default in Civil Case No. CEB-11453. While the order of default was eventually set aside, complainant incurred expenses to travel to the Philippines, which were conservatively estimated at $10,000.00. He argues that respondents conduct constitute professional misconduct and malpractice as well as trifling with court processes.

In his defense, respondent claims in his Answer[8] that he always acted in good faith in his professional relationship with complainant in spite of the fact that they have not personally met. He based the matters he wrote in the Complaint on information and documents supplied by Mrs. Charito Y. Baclig, complainants sister-in-law and attorney-infact, indicating that he was sole and exclusive owner of the properties. This was sometime in November 1983. No affidavit of adjudication was ever furnished respondent by complainant and this was apparently suppressed because it would show that the properties formed part of the estate. Eight years later, in November 1991, long after Special Proceedings No. 3971-R was settled and the attorney-client relationship between complainant and respondent was terminated, Mrs. Milagros Abaqueta through Mrs. Baclig, engaged his services to file Civil Case No. CEB-11453. Mrs. Baclig presented to him a deed of absolute sale dated July 7, 1975,[9] showing that the properties subject hereof were not complainants exclusive property but his conjugal property with his wife, the same having been acquired during the subsistence of their marriage. Thus, in all good faith, respondent alleged in the complaint that said properties were conjugal assets of the spouses. Respondent further pointed out that his law firm handles on the average eighty new court cases annually and personally interviews four or five clients, prospective clients and/or witnesses daily except Saturdays and Sundays. It regularly closes to the public at 7:00 p.m., but work continues sometimes until 8:30 p.m. This has been going on for the last twentyfive years out of respondents thirty-three years of private practice. The absence of personal contact with complainant and the lapse of eight years resulted in the oversight and/or lapse of respondents memory that complainant was a former client. Furthermore, the caption of the Special Proceeding was not in the name of complainant but was entitled, In the Matter of the Intestate Estate of Bonifacia Payahay Abaqueta. Respondent expressed regret over the oversight and averred that immediately after discovering that he formerly represented complainant in Special Proceeding No. 3971-R, he filed a motion to withdraw as counsel for plaintiff, which was granted by the trial court. [10] He denied any malice in his acts and alleged that it is not in his character to do malice or falsehood particularly in the exercise of his profession. In his Comments/Observations on Respondents Answer,[11] complainant averred that respondents conduct was geared towards insuring a court victory for Milagros Yap in Civil Case No. CEB-11453, wherein he deliberately stated that complainants address was 9203 Riverside Lodge Drive, Houston, Texas, 77083, U.S.A., when he knew fully well that complainants true and correct address was c/o V.A. Hospital, 7th Street & Italian School Road, Phoenix, Arizona, 85013, U.S.A. By falsely stating and concealing his true and correct address, respondent eventually succeeded in obtaining a default judgment in favor of his client. During the pendency of these proceedings before the IBP, it appeared that respondents son got married to the daughter of IBP National President Arthur D. Lim. Thus, Atty. Lim inhibited himself from participating in the resolution of the case.[12] Subsequently, a Resolution was issued requiring the IBP to elevate the entire records of the case within thirty (30) days from notice.[13] The main issue to be resolved in the case at bar is whether or not respondent violated Rule 15.03 of the Code of Professional Responsibility. The investigating commissioner found that respondent clearly violated the prohibition against representing conflicting interests and recommended that he be suspended from the practice of law for a period of three (3) months. We find the recommendation well-taken. Rule 15.03 of the Code of Professional Responsibility explicitly provides that

RULE 15.03. A lawyer shall not represent conflicting interests except by written consent of all concerned given after a full disclosure of the facts. There is a conflict of interest if there is an inconsistency in the interests of two or more opposing parties. The test is whether or not in behalf of one client, it is the lawyers duty to fight for an issue or claim but it is his duty to oppose it for the other client. [14] In short, if he argues for one client, this argument will be opposed by him when he argues for the other client.[15] There is a representation of conflicting interests if the acceptance of the new retainer will require the attorney to do anything which will injuriously affect his first client in any matter in which he represents him and also whether he will be called upon in his new relation, to use against his first client any knowledge acquired through their connection.[16] As pointed out by the investigating commissioner, respondent does not deny that he represented complainant in Special Proceedings No. 3971-R. He also does not deny that he is the lawyer of Milagros Yap Abaqueta in Civil Case No. CEB-11453, filed against complainant and involving the same properties which were litigated in Special Proceedings No. 3971-R. Respondent also admitted that he did not secure the consent of complainant before he agreed to act as Milagros Yap Abaquetas lawyer in Civil Case No. CEB-11453. The reasons proffered by respondent are hardly persuasive to excuse his clear representation of conflicting interests in this case. First, the investigating commissioner observed that the name Gamaliel Abaqueta is not a common name. Once heard, it will surely ring a bell in ones mind if he came across the name again. In this case, respondent actively prosecuted the cause of complainant in Special Proceedings No. 3971-R, such that it would be impossible for respondent not to have recalled his name. Second, assuming arguendo that respondents memory was indeed faulty, still it is incredible that he could not recall that complainant was his client, considering that Mrs. Charito Baclig, who was complainants attorney-in-fact and the go-between of complainant and respondent in Special Proceedings No. 3971-R, was the same person who brought Milagros Yap Abaqueta to him. Even a person of average intelligence would have made the connection between Mrs. Baclig and complainant under such circumstances. Lastly, the fact that the subject matter of Civil Case No. CEB-11453 and Special Proceedings No. 3971-R are the same properties could not have escaped the attention of respondent. With such an abundance of circumstances to aid respondents memory, it simply strains credulity for him to have conveniently forgotten his past engagement as complainants lawyer. What rather appears, given the prevailing facts of this case, is that he chose to ignore them on the assumption that the long period of time spanning his past and present engagement would effectively blur the memories of the parties to such a discrepancy. It is axiomatic that no lawyer is obliged to act either as adviser or advocate for every person who may wish to become his client. He has the right to decline such employment, [17] subject, however, to Canon 14 of the Code of Professional Responsibility.[18] Once he agrees to take up the cause of the client, the lawyer owes fidelity to such cause and must always be mindful of the trust and confidence reposed in him.[19] He must serve the client with competence and diligence[20] and champion the latters cause with wholehearted fidelity, care and devotion.[21] A lawyer may not, without being guilty of professional misconduct, act as counsel for a person whose interest conflicts with that of his former client.[22] The reason for the prohibition is found in the relation of attorney and client which is one of trust and confidence of the highest degree.[23] Indeed, as we stated in Sibulo v. Cabrera,[24] The relation of attorney and client is based on trust, so that double dealing, which could sometimes lead to treachery, should be avoided.[25]

Credence cannot, however, be given to the charge that respondent fraudulently and maliciously falsified the true and correct address of the complainant notwithstanding respondents knowledge thereof. Lawyers normally do not have knowledge of the personal circumstances of a party in a case and usually rely on the information supplied by their clients. The fact that respondent sent a letter to complainant at the latters correct address[26] sixteen months before the filing of Civil Case No. CEB-11453 does not by itself prove malice on the part of respondent. A new address was furnished by Milagros Yap Abaqueta days before the complaint was filed. Respondent had no reason to doubt the correctness of the address of the complainant given to him by Milagros Yap Abaqueta considering that she was complainants wife. WHEREFORE, Atty. Bernardito A. Florido is SUSPENDED from the practice of law for Three (3) months. He is further ADMONISHED to exercise greater care and diligence in the performance of his duties towards his clients and the court. He is warned that a repetition of the same or similar offense will be dealt with more severely.

G.R. No. L-961

September 21, 1949

BLANDINA GAMBOA HILADO, petitioner, vs. JOSE GUTIERREZ DAVID, VICENTE J. FRANCISCO, JACOB ASSAD and SELIM JACOB ASSAD, respondents. Delgado, Dizon and Flores for petitioner. Vicente J. Francisco for respondents. TUASON, J.: It appears that on April 23, 1945, Blandina Gamboa Hilado brought an action against Selim Jacob Assad to annul the sale of several houses and lot executed during the Japanese occupation by Mrs. Hilado's now deceased husband. On May 14, Attorneys Ohnick, Velilla and Balonkita filed an answer on behalf of the defendant; and on June 15, Attorneys Delgado, Dizon, Flores and Rodrigo registered their appearance as counsel for the plaintiff. On October 5, these attorneys filed an amended complaint by including Jacob Assad as party defendant. On January 28, 1946, Attorney Francisco entered his appearance as attorney of record for the defendant in substitution for Attorney Ohnick, Velilla and Balonkita who had withdrawn from the case. On May 29, Attorney Dizon, in the name of his firm, wrote Attorney Francisco urging him to discontinue representing the defendants on the ground that their client had consulted with him about her case, on which occasion, it was alleged, "she turned over the papers" to Attorney Francisco, and the latter sent her a written opinion. Not receiving any answer to this suggestion, Attorney Delgado, Dizon, Flores and Rodrigo on June 3, 1946, filed a formal motion with the court, wherein the case was and is pending, to disqualify Attorney Francisco. Attorney Francisco's letter to plaintiff, mentioned above and identified as Exhibit A, is in full as follows:

VICENTE J. FRANCISCO Attorney-at-Law 1462 Estrada, Manila July 13, 1945. Mrs. Blandina Gamboa Hilado Manila, Philippines My dear Mrs. Hilado: From the papers you submitted to me in connection with civil case No. 70075 of the Court of First Instance of Manila, entitled "Blandina Gamboa Hilado vs. S. J. Assad," I find that the basic facts which brought about the controversy between you and the defendant therein are as follows: (a) That you were the equitable owner of the property described in the complaint, as the same was purchased and/or built with funds exclusively belonging to you, that is to say, the houses and lot pertained to your paraphernal estate; (b) That on May 3, 1943, the legal title to the property was with your husband, Mr. Serafin P. Hilado; and (c) That the property was sold by Mr. Hilado without your knowledge on the aforesaid date of May 3, 1943. Upon the foregoing facts, I am of the opinion that your action against Mr. Assad will not ordinarily prosper. Mr. Assad had the right to presume that your husband had the legal right to dispose of the property as the transfer certificate of title was in his name. Moreover, the price of P110,000 in Japanese military notes, as of May 3, 1943, does not quite strike me as so grossly inadequate as to warrant the annulment of the sale. I believe, lastly, that the transaction cannot be avoided merely because it was made during the Japanese occupation, nor on the simple allegation that the real purchaser was not a citizen of the Philippines. On his last point, furthermore, I expect that you will have great difficulty in proving that the real purchaser was other than Mr. Assad, considering that death has already sealed your husband's lips and he cannot now testify as to the circumstances of the sale. For the foregoing reasons, I regret to advise you that I cannot appear in the proceedings in your behalf. The records of the case you loaned to me are herewith returned. Yours very truly, (Sgd.) VICENTE J. FRANCISCO VJF/Rag. In his answer to plaintiff's attorneys' complaint, Attorney Francisco alleged that about May, 1945, a real estate broker came to his office in connection with the legal separation of a woman who had been deserted by her husband, and also told him (Francisco) that there was

a pending suit brought by Mrs. Hilado against a certain Syrian to annul the sale of a real estate which the deceased Serafin Hilado had made to the Syrian during the Japanese occupation; that this woman asked him if he was willing to accept the case if the Syrian should give it to him; that he told the woman that the sales of real property during the Japanese regime were valid even though it was paid for in Japanese military notes; that this being his opinion, he told his visitor he would have no objection to defending the Syrian; That one month afterwards, Mrs. Hilado came to see him about a suit she had instituted against a certain Syrian to annul the conveyance of a real estate which her husband had made; that according to her the case was in the hands of Attorneys Delgado and Dizon, but she wanted to take it away from them; that as he had known the plaintiff's deceased husband he did not hesitate to tell her frankly that hers was a lost case for the same reason he had told the broker; that Mrs. Hilado retorted that the basis of her action was not that the money paid her husband was Japanese military notes, but that the premises were her private and exclusive property; that she requested him to read the complaint to be convinced that this was the theory of her suit; that he then asked Mrs. Hilado if there was a Torrens title to the property and she answered yes, in the name of her husband; that he told Mrs. Hilado that if the property was registered in her husband's favor, her case would not prosper either; That some days afterward, upon arrival at his law office on Estrada street, he was informed by Attorney Federico Agrava, his assistant, that Mrs. Hilado had dropped in looking for him and that when he, Agrava, learned that Mrs. Hilado's visit concerned legal matters he attended to her and requested her to leave the "expediente" which she was carrying, and she did; that he told Attorney Agrava that the firm should not handle Mrs. Hilado's case and he should return the papers, calling Agrava's attention to what he (Francisco) already had said to Mrs. Hilado; That several days later, the stenographer in his law office, Teofilo Ragodon, showed him a letter which had been dictated in English by Mr. Agrava, returning the "expedients" to Mrs. Hilado; that Ragodon told him (Attorney Francisco) upon Attorney Agrava's request that Agrava thought it more proper to explain to Mrs. Hilado the reasons why her case was rejected; that he forthwith signed the letter without reading it and without keeping it for a minute in his possession; that he never saw Mrs. Hilado since their last meeting until she talked to him at the Manila Hotel about a proposed extrajudicial settlement of the case; That in January, 1946, Assad was in his office to request him to handle his case stating that his American lawyer had gone to the States and left the case in the hands of other attorneys; that he accepted the retainer and on January 28, 1946, entered his appearance. Attorney Francisco filed an affidavit of stenographer Ragodon in corroboration of his answer. The judge trying the case, Honorable Jose Gutierrez David, later promoted to the Court of Appeals, dismissed the complaint. His Honor believed that no information other than that already alleged in plaintiff's complaint in the main cause was conveyed to Attorney Francisco, and concluded that the intercourse between the plaintiff and the respondent did not attain the point of creating the relation of attorney and client. Stripped of disputed details and collateral matters, this much is undoubted: That Attorney Francisco's law firm mailed to the plaintiff a written opinion over his signature on the merits of her case; that this opinion was reached on the basis of papers she had submitted at his office; that Mrs. Hilado's purpose in submitting those papers was to secure Attorney Francisco's professional services. Granting the facts to be no more than these, we agree with petitioner's counsel that the relation of attorney and client between Attorney Francisco

and Mrs. Hilado ensued. The following rules accord with the ethics of the legal profession and meet with our approval: In order to constitute the relation (of attorney and client) a professional one and not merely one of principal and agent, the attorneys must be employed either to give advice upon a legal point, to prosecute or defend an action in court of justice, or to prepare and draft, in legal form such papers as deeds, bills, contracts and the like. (Atkinson vs. Howlett, 11 Ky. Law Rep. (abstract), 364; cited in Vol. 88, A. L. R., p. 6.) To constitute professional employment it is not essential that the client should have employed the attorney professionally on any previous occasion. . . . It is not necessary 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. 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. . . . (5 Jones Commentaries on Evidence, pp. 4118-4119.) An attorney is employed-that is, he is engaged in his professional capacity as a lawyer or counselor-when he is listening to his client's preliminary statement of his case, or when he is giving advice thereon, just as truly as when he is drawing his client's pleadings, or advocating his client's cause in open court. (Denver Tramway Co. vs. Owens, 20 Colo., 107; 36 P., 848.) Formality is not an essential element of the employment of an attorney. The contract may be express or implied and it is sufficient that the advice and assistance of the attorney is sought and received, in matters pertinent to his profession. An acceptance of the relation is implied on the part of the attorney from his acting in behalf of his client in pursuance of a request by the latter. (7 C. J. S., 848-849; see Hirach Bros. and Co. vs. R. E. Kennington Co., 88 A. L. R., 1.) Section 26 (e), Rule 123 of the Rules of Court provides that "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 professional employment;" and section 19 (e) of Rule 127 imposes upon an attorney the duty "to maintain inviolate the confidence, and at every peril to himself, to preserve the secrets of his client." There is no law or provision in the Rules of Court prohibiting attorneys in express terms from acting on behalf of both parties to a controversy whose interests are opposed to each other, but such prohibition is necessarily implied in the injunctions above quoted. (In re De la Rosa, 27 Phil., 258.) In fact the prohibition derives validity from sources higher than written laws and rules. As has been aptly said in In re Merron, 22 N. M., 252, L.R.A., 1917B, 378, "information so received is sacred to the employment to which it pertains," and "to permit it to be used in the interest of another, or, worse still, in the interest of the adverse party, is to strike at the element of confidence which lies at the basis of, and affords the essential security in, the relation of attorney and client." That only copies of pleadings already filed in court were furnished to Attorney Agrava and that, this being so, no secret communication was transmitted to him by the plaintiff, would not vary the situation even if we should discard Mrs. Hilado's statement that other papers, personal and private in character, were turned in by her. Precedents are at hand to support the doctrine that the mere relation of attorney and client ought to preclude the attorney from accepting the opposite party's retainer in the same litigation regardless of what information was received by him from his first client.

The principle which forbids an attorney who has been engaged to represent a client from thereafter appearing on behalf of the client's opponent applies equally even though during the continuance of the employment nothing of a confidential nature was revealed to the attorney by the client. (Christian vs. Waialua Agricultural Co., 30 Hawaii, 553, Footnote 7, C. J. S., 828.) Where it appeared that an attorney, representing one party in litigation, had formerly represented the adverse party with respect to the same matter involved in the litigation, the court need not inquire as to how much knowledge the attorney acquired from his former during that relationship, before refusing to permit the attorney to represent the adverse party. (Brown vs. Miller, 52 App. D. C. 330; 286, F. 994.) In order that a court may prevent an attorney from appearing against a former client, it is unnecessary that the ascertain in detail the extent to which the former client's affairs might have a bearing on the matters involved in the subsequent litigation on the attorney's knowledge thereof. (Boyd vs. Second Judicial Dist. Court, 274 P., 7; 51 Nev., 264.) This rule has been so strictly that it has been held an attorney, on terminating his employment, cannot thereafter act as counsel against his client in the same general matter, even though, while acting for his former client, he acquired no knowledge which could operate to his client's disadvantage in the subsequent adverse employment. (Pierce vs. Palmer [1910], 31 R. I., 432; 77 Atl., 201, Ann. Cas., 1912S, 181.) Communications between attorney and client are, in a great number of litigations, a complicated affair, consisting of entangled relevant and irrelevant, secret and well known facts. In the complexity of what is said in the course of the dealings between an attorney and a client, inquiry of the nature suggested would lead to the revelation, in advance of the trial, of other matters that might only further prejudice the complainant's cause. And the theory would be productive of other un salutary results. To make the passing of confidential communication a condition precedent; i.e., to make the employment conditioned on the scope and character of the knowledge acquired by an attorney in determining his right to change sides, would not enhance the freedom of litigants, which is to be sedulously fostered, to consult with lawyers upon what they believe are their rights in litigation. The condition would of necessity call for an investigation of what information the attorney has received and in what way it is or it is not in conflict with his new position. Litigants would in consequence be wary in going to an attorney, lest by an unfortunate turn of the proceedings, if an investigation be held, the court should accept the attorney's inaccurate version of the facts that came to him. "Now the abstinence from seeking legal advice in a good cause is by hypothesis an evil which is fatal to the administration of justice." (John H. Wigmore's Evidence, 1923, Section 2285, 2290, 2291.) Hence the necessity of setting down the existence of the bare relationship of attorney and client as the yardstick for testing incompatibility of interests. This stern rule is designed not alone to prevent the dishonest practitioner from fraudulent conduct, but as well to protect the honest lawyer from unfounded suspicion of unprofessional practice. (Strong vs. Int. Bldg., etc.; Ass'n, 183 Ill., 97; 47 L.R.A., 792.) It is founded on principles of public policy, on good taste. As has been said in another case, the question is not necessarily one of the rights of the parties, but as to whether the attorney has adhered to proper professional standard. With these thoughts in mind, it behooves attorneys, like Caesar's wife, not only to keep inviolate the client's confidence, but also to avoid the appearance of treachery and

double-dealing. Only thus can litigants be encouraged to entrust their secrets to their attorneys which is of paramount importance in the administration of justice. So without impugning respondent's good faith, we nevertheless can not sanction his taking up the cause of the adversary of the party who had sought and obtained legal advice from his firm; this, not necessarily to prevent any injustice to the plaintiff but to keep above reproach the honor and integrity of the courts and of the bar. Without condemning the respondents conduct as dishonest, corrupt, or fraudulent, we do believe that upon the admitted facts it is highly in expedient. It had the tendency to bring the profession, of which he is a distinguished member, "into public disrepute and suspicion and undermine the integrity of justice." There is in legal practice what called "retaining fee," the purpose of which stems from the realization that the attorney is disabled from acting as counsel for the other side after he has given professional advice to the opposite party, even if he should decline to perform the contemplated services on behalf of the latter. It is to prevent undue hardship on the attorney resulting from the rigid observance of the rule that a separate and independent fee for consultation and advice was conceived and authorized. "A retaining fee is a preliminary fee given to an attorney or counsel to insure and secure his future services, and induce him to act for the client. It is intended to remunerate counsel for being deprived, by being retained by one party, of the opportunity of rendering services to the other and of receiving pay from him, and the payment of such fee, in the absence of an express understanding to the contrary, is neither made nor received in payment of the services contemplated; its payment has no relation to the obligation of the client to pay his attorney for the services which he has retained him to perform." (7 C.J.S., 1019.) The defense that Attorney Agrava wrote the letter Exhibit A and that Attorney Francisco did not take the trouble of reading it, would not take the case out of the interdiction. If this letter was written under the circumstances explained by Attorney Francisco and he was unaware of its contents, the fact remains that his firm did give Mrs. Hilado a formal professional advice from which, as heretofore demonstrated, emerged the relation of attorney and client. This letter binds and estop him in the same manner and to the same degree as if he personally had written it. An information obtained from a client by a member or assistant of a law firm is information imparted to the firm. (6 C. J., 628; 7 C. J. S., 986.) This is not a mere fiction or an arbitrary rule; for such member or assistant, as in our case, not only acts in the name and interest of the firm, but his information, by the nature of his connection with the firm is available to his associates or employers. The rule is all the more to be adhered to where, as in the present instance, the opinion was actually signed by the head of the firm and carries his initials intended to convey the impression that it was dictated by him personally. No progress could be hoped for in "the public policy that the client in consulting his legal adviser ought to be free from apprehension of disclosure of his confidence," if the prohibition were not extended to the attorney's partners, employers or assistants. The fact that petitioner did not object until after four months had passed from the date Attorney Francisco first appeared for the defendants does not operate as a waiver of her right to ask for his disqualification. In one case, objection to the appearance of an attorney was allowed even on appeal as a ground for reversal of the judgment. In that case, in which throughout the conduct of the cause in the court below the attorney had been suffered so to act without objection, the court said: "We are all of the one mind, that the right of the appellee to make his objection has not lapsed by reason of failure to make it sooner; that professional confidence once reposed can never be divested by expiration of professional employment." (Nickels vs. Griffin, 1 Wash. Terr., 374, 321 A. L. R. 1316.)

The complaint that petitioner's remedy is by appeal and not by certiorari deserves scant attention. The courts have summary jurisdiction to protect the rights of the parties and the public from any conduct of attorneys prejudicial to the administration of the justice. The summary jurisdiction of the courts over attorneys is not confined to requiring them to pay over money collected by them but embraces authority to compel them to do whatever specific acts may be incumbent upon them in their capacity of attorneys to perform. The courts from the general principles of equity and policy, will always look into the dealings between attorneys and clients and guard the latter from any undue consequences resulting from a situation in which they may stand unequal. The courts acts on the same principles whether the undertaking is to appear, or, for that matter, not to appear, to answer declaration, etc. (6 C.J., 718 C.J.S., 1005.) This summary remedy against attorneys flows from the facts that they are officers of the court where they practice, forming a part of the machinery of the law for the administration of justice and as such subject to the disciplinary authority of the courts and to its orders and directions with respect to their relations to the court as well as to their clients. (Charest vs. Bishop, 137 Minn., 102; 162, N.W., 1062, Note 26, 7 C. J. S., 1007.) Attorney stand on the same footing as sheriffs and other court officers in respect of matters just mentioned. We conclude therefore that the motion for disqualification should be allowed. It is so ordered, without costs. Moran, C.J., Ozaeta, Paras, Feria, Bengzon, Padilla, Montemayor, Reyes and Torres, JJ., concur. FIRST DIVISION

[A.C. No. 5858. December 11, 2003]

ROGELIO R. SANTOS, BELTRAN, respondent.

SR., complainant,

vs. ATTY.

RODOLFO

C.

DECISION YNARES-SANTIAGO, J.: This is an administrative complaint for disbarment[1] filed by Rogelio R. Santos, Sr. against Atty. Rodolfo C. Beltran on the grounds of gross misconduct and malpractice. The pertinent facts are as follows: Spouses Filomeno Santiago Santos, Sr. and Benita Roxas Rodriguez had ten children, namely, Romeo, Filomeno, Jr., Arturo, Erlinda, Ma. Alicia, Arcely, Renato, Alberto and Benito and complainant Rogelio Santos, Sr. After the death of Filomeno, Benita donated their two residential lots situated at 11 Javier Baritan, Malabon, Metro Manila, consisting of 489 and 333.4 square meters, respectively, and covered by Transfer Certificates of Titles (TCT) Nos. R-18060 and R-18061, including the ancestral house situated thereon, in favor of the nine children, except complainant. Respondent lawyer notarized the Deed of Donation.[2] Benita Rodriguez died. Complainant and his brother, Alberto, were appointed administrators[3] in the intestate proceeding for the settlement of the spouses estate, docketed as SP. Proc. No. 516-AF, entitled In the Matter of the Intestate Estate of

Spouses Filomeno Santiago Santos, Sr. and Benita Roxas Rodriguez, filed before the Regional Trial Court of Cabanatuan City, Branch 26 thereof. On November 9, 1999, complainant filed a verified complaint against respondent before the Integrated Bar of the Philippines Commission on Bar Discipline (IBP-CBD), alleging that when respondent notarized the subject Deed of Donation, his siblings did not personally appear before him.[4] Complainant submitted the affidavit executed by Benito and Renato attesting to the fact that they signed the Deed of Donation not in the law office of the respondent but in their houses at Villa Benita Subdivision. The Deed also showed that his siblings secured their Community Tax Certificates twenty-two days after the execution of the Deed of Donation, or on September 9, 1994. Complainant contended that respondent notarized the Deed of Donation in disregard of Article 904[5] of the Civil Code. Moreover, he argued that his siblings were American citizens who were thus disqualified from owning real properties in the Philippines. Complainant further alleged that respondent appeared as private prosecutor in Criminal Case No. 73560 for falsification of public document, which he filed against Renato and Benito, without being engaged by him or authorized by the court; that respondent represented conflicting interest when he entered his appearance as defense counsel in an ejectment case in which his former client, Erlinda R. Santos-Crawford, was the plaintiff; and that respondent, through insidious machination acquired the titles of two residential lots at Villa Benita Subdivision owned by SpousesFilomeno and Benita Santos. Respondent denied the allegations. He confirmed the due execution of the Deed of Donation and submitted in support thereof the affidavit executed by Mely Lachica, the secretary of his law office. In her Affidavit, Lachica categorically stated that she caused all parties to sign the Deed. She, nevertheless admitted that she forgot to change the date of the execution of the Deed fromAugust 18, 1994 to September 9, 1994 when all the parties had secured their CTCs.[6] Respondent argued that complainants siblings may still acquire properties in the Philippines through hereditary succession even though they were already American citizens. The certifications issued by the Bureau of Immigration and Deportation were not conclusive proof of the arrival and departure of his siblings considering that there were many ports of entry in the country. Respondent also declared that complainant humiliated his mother when, in his presence and that of his siblings, complainant uttered the unsavory Tagalog words, Putang ina momatanda ka, walanghiya ka, walang pinagkatandaan dapat mamatay ka na.[
7]

Respondent denied having represented complainant in Criminal Case No. 73560 on December 15, 1999 when he appeared as private prosecutor. He explained that complainant filed a complaint for falsification of public document against him and his nine siblings, docketed as I.S. No. 04-99-3187, before the Office of the City Prosecutor of Cabanatuan City, relying on the affidavit executed by Benito and Renato that they signed the Deed of Donation in their houses at Villa Benita and not at respondents office. The prosecutor dismissed the complaint. A second action for falsification of public document was filed by complainant against Renato and Benito, docketed as Criminal Case No. 73560. Respondent appeared at one of the hearings of the said case to defend himself from the accusation of Benito and Renato. Respondent emphasized that he did not ask for any compensation from complainant for that isolated appearance. Respondent denied having acquired any property under litigation. On February 16, 1999, he bought[8] two parcels of land inside Villa Benita Subdivision, covered by TCT Nos. T50223 and 50225, from a corporation owned by the Santoses, Faberns Inc., and not from Spouses Filomeno and Benita Santos, as claimed by complainant. He was surprised when sometime in August 2002, complainant caused the annotation on the said titles of an

adverse claim that the properties belonged to the estate of Spouses Filomeno and Benita Santos. Complainant relied on theContract of Development dated May 10, 1995 which Faberns Inc. executed in favor of Villa Benita Management and Development Corporation where respondent was one of the directors. Respondent admitted having represented Erlinda R. Santos-Crawford in Civil Case No. 12105 for ejectment, entitled Erlinda R. Santos-Crawford v. Renato R. Santos and Rogelio R. Santos, Sr.,[9] involving a land covered by TCT No. T-10168 at No. 1 F. S. Avenue, Villa Benita Subdivision, Cabanatuan City and the improvements thereon. He also acted as defense counsel of Evalyn Valino, Norberto Valino and Danilo Agsaway in Civil Case No. 14823[10] for ejectment filed by Rogelio Santos on behalf of Erlinda R. Santos involving the same property. He emphasized that the decision in Civil Case No. 12105 had long been executed, thus the attorney-client relationship between him and Erlinda Santos-Crawford was also terminated. On July 19, 2002, the IBP-CBD found respondent guilty of violating his notarial commission and recommended that his commission be suspended for a period of one year.[11] The Board of Governors, in Resolution No. CBD Case No. 99-670, modified the recommendation, 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 the applicable laws and rules, with modification, and considering respondents violation of his notarial obligation, Respondents Commission as Notary Public is hereby SUSPENDED, with DISQUALIFICATION from being appointed as Notary Public for two (2) years from notice of final decision.[12] On October 11, 2002, respondent filed a motion for reconsideration of the aforestated Resolution, which was denied by the Board on December 14, 2002 on the ground that it has lost jurisdiction thereof upon its endorsement to this Court.[13] In essence, complainant seeks the disbarment of the respondent for allegedly notarizing a Deed of Donation without the affiants personally appearing before him. Indeed, the power to disbar must be exercised with great caution, and may be imposed only in a clear case of misconduct that seriously affects the standing and the character of the lawyer as an officer of the court and as a member of the bar.[14] Corollary thereto, gross misconduct is defined as improper or wrong conduct, the transgression of some established and definite rule of action, a forbidden act, a dereliction of duty, willful in character, and implies a wrongful intent and not mere error in judgment.[15] The rule is that a notarized document carries the evidentiary weight conferred upon it with respect to its due execution, and documents acknowledged before a notary public have in their favor the presumption of regularity.[16] In the instant case, complainant failed to controvert the said presumption by clear and convincing evidence. Instead, the quantum of evidence shows that complainants siblings appeared before the respondent as notary public and in fact, signed the deed. The claim of Renato and Benito Santos in their affidavit that they did not sign the document in the law office of the respondent but in their houses at Villa Benita is admissible only against them.[17] Likewise, we find the allegation of the complainant that it was physically impossible for his siblings to sign the document untenable. The certifications issued by the BID that the complainants siblings were absent at the time of the execution of the Deed of Donation is not absolute. There are many ports of entry which complainants siblings may have used in coming into the country. The possibility that complainants siblings executed and signed the Deed is not remote. The discrepancy in the date stamped in the Deed and the date when complainants siblings obtained their CTCs had

been substantially explained in the affidavit executed by the secretary of the law office, Mely Lachica. The allegation that respondent represented complainant in Criminal Case No. 73569 without being retained or authorized by the court is also untenable. Respondent adequately explained his isolated appearance at one of the hearings. The transcript of stenographic notes shows that respondent himself was in doubt as to the nature of his appearance in the case. In entering his appearance as private prosecutor, he did not intend to represent complainant but only to defend himself from the accusation of Benito and Renato that he notarized the Deed of Donation in their absence. This was patent in the transcript of stenographic notes wherein he admitted that he himself was in doubt as to his position. We are not persuaded by complainant who tried to insinuate that it was unethical for the respondent to represent him. Anent the charge that respondent acquired properties under litigation in violation of Article 1491[18] of the Civil Code, records show that respondent acquired the property from Faberns Inc., and not from Spouses Filemon and Benita Santos. Complainants allegation that respondent as director of Villa Benita Management and Development Corporation fraudulently caused the transfer of titles of properties, specifically parcels of lands owned by the family corporation, Faberns Inc., by executing a management and development contract, lacks basis. Respondent may not be held accountable based on mere allegation that through insidious machinations he deprived Spouses Filomeno and Benita Santos, now their estate, of the properties. Surmises, suspicion and conjectures are not bases of culpability. Lastly, complainant indicted respondent for representing conflicting interest in violation of Rule 15.03 of the Code of Professional Responsibility, viz: A lawyer shall not represent conflicting interests except by written consent of all concerned given after a full disclosure of the facts. There is conflict of interest when a lawyer represents inconsistent interests of two or more opposing parties. The test is whether or not in behalf of one client, it is the lawyers duty to fight for an issue or claim, but it is his duty to oppose it for the other client. In brief, if he argues for one client, this argument will be opposed by him when he argues for the other client. This rule covers not only cases in which confidential communications have been confided, but also those in which no confidence has been bestowed or will be used. Also, there is conflict of interests if the acceptance of the new retainer will require the attorney to perform an act which will injuriously affect his first client in any matter in which he represents him and also whether he will be called upon in his new relation to use against his first client any knowledge acquired through their connection. Another test of the inconsistency of interests is whether the acceptance of a new relation will prevent an attorney from the full discharge of his duty of undivided fidelity and loyalty to his client or invite suspicion of unfaithfulness or double dealing in the performance thereof.[19] In the case at bar, Civil Case No. 12105 for ejectment was filed by Arcely Y. Santos in behalf of Erlinda Santos-Crawford against complainant and Renato Santos. Respondent, however appeared as counsel for Evalyn Valino, Norberto Valino and Danilo Agsaway in Civil Case No. 14823 for ejectment filed by complainant as attorney-in-fact of Erlinda SantosCrawford. Civil Case No. 14823, although litigated by complainant, was actually brought in behalf of and to protect the interest of Erlinda Santos-Crawford. Respondents act of representing the parties against whom his other client, Erlinda Santos-Crawford, filed suit constituted conflict of interest.[20] WHEREFORE, respondent Atty. Rodolfo Beltran is found GUILTY of representing conflicting interests and is SUSPENDED from the practice of law for a period of one (1) year

effective immediately. Respondent is further STERNLY WARNED that a commission of the same or similar act in the future will be dealt with more severely. Let copies of this Resolution be entered in the record of respondent and served on the IBP, as well as on the Court Administrator who shall circulate it to all courts for their information and guidance. FIRST DIVISION

LETICIA GONZALES, Complainant,

A.C. No. 6836

Present:

PANGANIBAN, C.J., Chairman, YNARES-SANTIAGO, - versus AUSTRIA-MARTINEZ, CALLEJO, and CHICO-NAZARIO, JJ.

Promulgated: ATTY. MARCELINO CABUCANA, Respondent. January 23, 2006

x----------------------------------------------------------- x

RESOLUTION

AUSTRIA-MARTINEZ, J.:

Before this Court is a complaint filed by Leticia Gonzales (Gonzales) praying that Atty. Marcelino Cabucana, (respondent) be disbarred for representing conflicting interests.

On January 8, 2004, Gonzales filed a petition before the Integrated Bar of the Philippines (IBP) alleging that: she was the complainant in a case for sum of money and damages filed before the Municipal Trial Court in Cities (MTCC) of Santiago City, docketed as Civil Case No. 1-567 where she was represented by the law firm CABUCANA, CABUCANA, DE GUZMAN AND CABUCANA LAW OFFICE, with Atty. Edmar Cabucana handling the case and herein respondent as an associate/partner; on February 26, 2001, a decision was rendered in the civil case ordering the losing party to pay Gonzales the amount of P17,310.00 with interest and P6,000.00 as attorneys fees; Sheriff Romeo Gatcheco, failed to fully implement the writ of execution issued in connection with the judgment which prompted Gonzales to file a complaint against the said sheriff with this Court; in September 2003, Sheriff Gatcheco and his wife went to the house of Gonzales; they harassed Gonzales and asked her to execute an affidavit of desistance regarding her complaint before this Court; Gonzales thereafter filed against the Gatchecos criminal cases for trespass, grave threats, grave oral defamation, simple coercion and unjust vexation; notwithstanding the pendency of Civil Case No. 1-567, where respondents law firm was still representing Gonzales, herein respondent represented the Gatchecos in the cases filed by Gonzales against the said spouses; respondent should be disbarred from the practice of law since respondents acceptance of the cases of the Gatchecos violates the lawyer-client relationship between complainant and respondents law firm and renders respondent liable under the Code of Professional Responsibility (CPR) particularly Rules 10.01,[1]13.01,[2] 15.02,[3] 15.03, [4] 21.01[5] and 21.02.[6]

On January 9, 2004, the IBP-Commission on Bar Discipline ordered Atty. Marcelino Cabucana, Jr. to submit his Answer to the complaint.[7]

In his Answer, respondent averred: He never appeared and represented complainant in Civil Case No. 1-567 since it was his brother, Atty. Edmar Cabucana who appeared and represented Gonzales in said case. He admitted that he is representing Sheriff Gatcheco and his wife in the cases filed against them but claimed that his appearance is pro bono and that the spouses pleaded with him as no other counsel was willing to take their case. He entered his appearance in good faith and opted to represent the spouses rather than leave them defenseless. When the Gatchecos asked for his assistance, the spouses said that the cases filed against them by Gonzales were merely instigated by a high ranking official who wanted to get even with them for their refusal to testify in favor of the said official in another case. At first, respondent declined to serve as counsel of the spouses as he too did not want to incur the ire of the high-ranking official, but after realizing that he would be abdicating a sworn duty to delay no man for money or malice, respondent entered his appearance as defense counsel of the spouses free of any charge. Not long after, the present complaint was crafted against respondent which shows that respondent is now the subject of a demolition job. The civil case filed by Gonzales where respondents brother served as counsel is different and distinct from the criminal cases filed by complainant against the Gatcheco spouses, thus, he did not violate any canon on legal ethics. [8]

Gonzales filed a Reply contending that the civil case handled by respondents brother is closely connected with the cases of the Gatchecos which the respondent is handling; that the claim of respondent that he is handling the cases of the spouses pro bono is not true since he has his own agenda in offering his services to the spouses; and that the allegation that she is filing the cases against the spouses because she is being used by a powerful person is not true since she filed the said cases out of her own free will.[9]

The Commission on Bar Discipline of the IBP sent to the parties a Notice of Mandatory Conference dated March 1, 2004.[10] On the scheduled conference, only a representative of complainant appeared.[11] Commissioner Demaree Raval of the IBP-CBD then directed both parties to file their respective verified position papers.[12]

Complainant filed a Memorandum reiterating her earlier assertions and added that respondent prepared and notarized counter-affidavits of the Gatcheco spouses; that the high-ranking official referred to by respondent is Judge Ruben Plata and the accusations of respondent against the said judge is an attack against a brother in the profession which is a violation of the CPR; and that respondent continues to use the name of De Guzman in their law firm despite the fact that said partner has already been appointed as Assistant Prosecutor of Santiago City, again in violation of the CPR.[13]

Respondent filed his Position Paper restating his allegations in his Answer.[14]

On August 23, 2004, Commissioner Wilfredo E.J.E. Reyes issued an Order notifying both parties to appear before his office on October 28, 2004 for a clarificatory question regarding said case.[15] On the said date, only respondent appeared[16] presenting a sworn affidavit executed by Gonzales withdrawing her complaint against respondent. It reads:

SINUMPAANG SALAYSAY TUNGKOL SA PAG-UURONG NG DEMANDA

Ako, si LETICIA GONZALES, nasa tamang edad, Pilipino, may asawa, at nakatira sa Barangay Dubinan East, Santiago City, makaraang manumpa ayon sa batas ay nagsasabing: Ako ang nagdedemanda o petitioner sa CBD Case No. 04-1186 na may pamagat na Leticia Gonzales versus Atty. Marcelino C. Cabucana, Jr. na kasalukuyang nahaharap sa Commission on Bar Discipline ng Integrated Bar of the Philippines

Ang pagkakahain ng naturang demanda ay nag-ugat sa dipagkakaintindihan na namamagitan sa akin at nina Mr. and Mrs. Romeo and Anita Gatcheco.

Dahil sa aking galit sa naturang mag-asawa, idinawit ko si Atty. Marcelino C. Cabucana, Jr. sa sigalot na namamagitan sa akin at sa magasawang Gatcheco, gayong nalalaman ko na siAtty. Marcelino C. Cabucana ay walang nalalaman sa naturang di pagkakaintindihan.

Makaraang pag-isipang mabuti ang paghain ko ng demanda kontra kay Atty. Marcelino C. Cabucana, Jr., nakumbinsi ako na ang pagdedemanda ko kay Atty. Marcelino C. Cabucana, Jr.ay isang malaking pagkakamali dahil siya ay walang kinalalaman (sic) sa di pagkakaintindihan naming(sic) ng magasawang Gatcheco.

Si Atty. Marcelino C. Cabucana, Jr. ay di ko rin naging abogado sa Civil Case No. 1-567 (MTCC Br. I Santiago City) na inihain ko kontra kay Eduardo Mangano.

Nais kong ituwid ang lahat kung kayat aking iniuurong ang naturang kasong inihain ko kontra kay Atty. Marcelino C. Cabucana, Jr. at dahil dito ay hindi na ako interesado pang ituloy and naturang kaso, at aking hinihiling sa kinauukulan na dismisin na ang naturang kaso. Ginawa ko ang sinumpaang salaysay na ito upang patotohanan sa lahat ng nakasaad dito.[17]

Commissioner Reyes issued an Order dated October 28, 2004 requiring Gonzales to appear before him on November 25, 2004, to affirm her statements and to be subject to clarificatory questioning.[18] However, none of the parties appeared.[19] On February 17, 2005, only respondent was present. Commissioner Reyes then considered the case as submitted for resolution.[20]

On February 24, 2005, Commissioner Reyes Recommendation, portions of which are quoted hereunder:

submitted

his

Report

and

The Undersigned Commissioner believes that the respondent made a mistake in the acceptance of the administrative case of Romeo Gatcheco, however, the Commission (sic) believes that there was no malice and bad faith in the said acceptance and this can be shown by the move of the complainant to unilaterally withdraw the case which she filed against Atty. Marcelino C. Cabucana, Jr. However, Atty. Cabucana is reminded to be more careful in the acceptance of cases as conflict of interests might arise.

It is respectfully recommended that Atty. Marcelino C. Cabucana, Jr. (be) sternly warned and reprimanded andadvised to be more circumspect and careful in accepting cases which might result in conflict of interests.[21]

On June 25, 2005, a Resolution was passed by the Board of Governors of the IBP, to wit:

RESOLUTION NO. XVI-2005-153 CBD CASE NO. 03-1186 Leticia Gonzales vs. Atty. Marcelino Cabucana, Jr.

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 as Annex A; and, finding the recommendation fully supported by the evidence on record and the applicable laws and rules, and considering that respondent made (a) mistake in the acceptance of the administrative case of Romeo Gatcheco, Atty. Marcelino Cabucana, Jr. is hereby WARNED and REPRIMANDED and advised to be more circumspect and careful in accepting cases which might result in conflict of interests.[22] Before going to the merits, let it be clarified that contrary to the report of Commissioner Reyes, respondent did not only represent the Gatcheco spouses in the administrative case filed by Gonzales against them. As respondent himself narrated in his Position Paper, he likewise acted as their counsel in the criminal cases filed by Gonzales against them.[23] With that settled, we find respondent guilty of violating Rule 15.03 of Canon 15 of the Code of Professional Responsibility, to wit: Rule 15.03 A lawyer shall not represent conflicting interest except by written consent of all concerned given after a full disclosure of the facts.

It is well-settled that a lawyer is barred from representing conflicting interests except by written consent of all concerned given after a full disclosure of the facts. [24] Such prohibition is founded on principles of public policy and good taste as the nature of the lawyer-client relations is one of trust and confidence of the highest degree.[25] Lawyers are expected not only to keep inviolate the clients confidence, but also to avoid the appearance of treachery and double-dealing for only then can litigants be encouraged to entrust their secrets to their lawyers, which is of paramount importance in the administration of justice.[26] One of the tests of inconsistency of interests is whether the acceptance of a new relation would prevent the full discharge of the lawyers duty of undivided fidelity and loyalty to the client or invite suspicion of unfaithfulness or double-dealing in the performance of that duty.[27]

As we expounded in the recent case of Quiambao vs. Bamba,[28]

The proscription against representation of conflicting interests applies to a situation where the opposing parties are present clients in the same action or in an unrelated action. It is of no moment that the lawyer would not be called upon to contend for one client that which the lawyer has to oppose for the other client, or that there would be no occasion to use the confidential information acquired from one to the disadvantage of the other as the two actions are wholly unrelated. It is enough that the opposing parties in one case, one of whom would lose the suit, are present clients and the nature or conditions of the lawyers respective retainers with each of them would affect the performance of the duty of undivided fidelity to both clients.[29] The claim of respondent that there is no conflict of interests in this case, as the civil case handled by their law firm where Gonzales is the complainant and the criminal cases filed by Gonzales against the Gatcheco spouses are not related, has no merit. The representation of opposing clients in said cases, though unrelated, constitutes conflict of interests or, at the very least, invites suspicion of double-dealing which this Court cannot allow.[30] Respondent further argued that it was his brother who represented Gonzales in the civil case and not him, thus, there could be no conflict of interests. We do not agree. As respondent admitted, it was their law firm which represented Gonzales in the civil case. Such being the case, the rule against representing conflicting interests applies. As we explained in the case of Hilado vs. David:[31] [W]e can not sanction his taking up the cause of the adversary of the party who had sought and obtained legal advice from his firm; this, not necessarily to prevent any injustice to the plaintiff but to keep above reproach the honor and integrity of the courts and of the bar. Without condemning the respondents conduct as dishonest, corrupt, or fraudulent, we do believe that upon the admitted facts it is highly inexpedient. It had the tendency to bring the profession, of which he is a distinguished member, into public disrepute and suspicion and undermine the integrity of justice.[32]

The claim of respondent that he acted in good faith and with honest intention will also not exculpate him as such claim does not render the prohibition inoperative.[33] In the same manner, his claim that he could not turn down the spouses as no other lawyer is willing to take their case cannot prosper as it is settled that while there may be instances where lawyers cannot decline representation they cannot be made to labor under conflict of interest between a present client and a prospective one.[34] Granting also that there really was no other lawyer who could handle the spouses case other than him, still he should have observed the requirements laid down by the rules by conferring with the prospective client to ascertain as soon as practicable whether the matter would involve a conflict with another client then seek the written consent of all concerned after a full disclosure of the facts. [35] These respondent failed to do thus exposing himself to the charge of double-dealing. We note the affidavit of desistance filed by Gonzales. However, we are not bound by such desistance as the present case involves public interest.[36] Indeed, the Courts exercise of its power to take cognizance of administrative cases against lawyers is not for the purpose of enforcing civil remedies between parties, but to protect the court and the public against an attorney guilty of unworthy practices in his profession.[37] In similar cases where the respondent was found guilty of representing conflicting interests a penalty ranging from one to three years suspension was imposed.[38] We shall consider however as mitigating circumstances the fact that he is representing the Gatcheco spouses pro bono and that it was his firm and not respondent personally, which handled the civil case of Gonzales. As recounted by complainant herself, Atty. Edmar Cabucana signed the civil case of complainant by stating first the name of the law firm CABUCANA, CABUCANA, DE GUZMAN AND CABUCANA LAW OFFICE, under which, his name and signature appear; while herein respondent signed the pleadings for the Gatcheco spouses only with his name, [39] without any mention of the law firm. We also note the observation of the IBP Commissioner Reyes that there was no malice and bad faith in respondents acceptance of the Gatchecos cases as shown by the move of complainant to withdraw the case. Thus, for violation of Rule 15.03, Canon 15 of the Code of Professional Responsibility and taking into consideration the aforementioned mitigating circumstances, we impose the penalty of fine of P2,000.00.

WHEREFORE, Resolution No. XVI-2005-153 of the Integrated Bar of the Philippines is APPROVED with MODIFICATION that respondent Atty. Marcelino Cabucana, Jr. is FINED the amount of Two Thousand Pesos (P2,000.00) with a STERN WARNING that a commission of the same or similar act in the future shall be dealt with more severely.