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A.C. No. 9872 January 28, 2014 Respondent obtained P200,000 from Navarro for the registration expenses.
Navarro later learned that the registration decree over the property was
NATIVIDAD P. NAVARRO and HILDA S. PRESBITERO, Complainants, already issued in the name of one Teodoro Yulo. Navarro alleged that she
vs. would not have spent for the registration of the property if respondent only
ATTY. IVAN M. SOLIDUM, JR., Respondent. apprised her of the real situation of the property.

DECISION On 25 May 2006, respondent obtained a loan of P1,000,000 from Navarro

to finance his sugar trading business. Respondent and Navarro executed a
Memorandum of Agreement (MOA) and agreed that the loan (a) shall be for
PER CURIAM: a period of one year; (b) shall earn interest at the rate of 10% per month;
and (c) shall be secured by a real estate mortgage over a property located
This case originated from a complaint for disbarment, dated 26 May 2008, in Barangay Alijis, Bacolod City, covered by Transfer Certificate of Title No.
filed by Natividad P. Navarro (Navarro) and Hilda S. Presbitero (Presbitero) 304688. They also agreed that respondent shall issue postdated checks to
against Atty. Ivan M. Solidum, Jr. (respondent) before the Integrated Bar of cover the principal amount of the loan as well as the interest thereon.
the Philippines Commission on Bar Discipline (IBP-CBD). Respondent delivered the checks to Navarro, drawn against an account in
Metrobank, Bacolod City Branch, and signed them in the presence of
From the Report, dated 1July 2009, of the IBP-CBD, we gathered the Navarro.
following facts of the case:
In June 2006, respondent obtained an additional loan of P1,000,000 from
On 4 April 2006, respondent signed a retainer agreement with Presbitero to Navarro, covered by a second MOA with the same terms and conditions as
follow up the release of the payment for the latters 2.7-hectare property the first MOA. Respondent sent Navarro, through a messenger, postdated
located in Bacolod which was the subject of a Voluntary Offer to Sell (VOS) checks drawn against an account in Bank of Commerce, Bacolod City
to the Department of Agrarian Reform (DAR). The agreement also included Branch. Respondent likewise discussed with Navarro about securing a
the payment of the debts of Presbiteros late husband to the Philippine "Tolling Agreement" with Victorias Milling Company, Inc. but no agreement
National Bank (PNB), the sale of the retained areas of the property, and the was signed.
collection of the rentals due for the retained areas from their occupants. It
appeared that the DAR was supposed to payP700,000 for the property but At the same time, respondent obtained a loan of P1,000,000 from
it was mortgaged by Presbitero and her late husband to PNB Presbitero covered by a third MOA, except that the real estate mortgage
for P1,200,000. Presbitero alleged that PNBs claim had already prescribed, was over a 263-square-meter property located in Barangay Taculing,
and she engaged the services of respondent to represent her in the matter. Bacolod City. Respondent sent Presbitero postdated checks drawn against
Respondent proposed the filing of a case for quieting of title against PNB. an account in Metrobank, Bacolod City Branch.
Respondent and Presbitero agreed to an attorneys fee of 10% of the
proceeds from the VOS or the sale of the property, with the expenses to be Presbitero was dissatisfied with the value of the 263-square-meter property
advanced by Presbitero but deductible from respondents fees. Respondent mortgaged under the third MOA, and respondent promised to execute a
received P50,000 from Presbitero, supposedly for the expenses of the case, real estate mortgage over a 1,000-square-meter parcel of land adjacent to
but nothing came out of it. the 4,000-square-meter property he mortgaged to Navarro.

In May 2006, Presbiteros daughter, Ma. Theresa P. Yulo (Yulo), also However, respondent did not execute a deed for the additional security.
engaged respondents services to handle the registration of her 18.85-
hectare lot located in Nasud-ong, Caradio-an, Himamaylan, Negros. Yulo
convinced her sister, Navarro, to finance the expenses for the registration Respondent paid the loan interest for the first few months. He was able to
of the property. Respondent undertook to register the property in pay complainants a total of P900,000. Thereafter, he failed to pay either
consideration of 30% of the value of the property once it is registered. the principal amount or the interest thereon. In September 2006, the
checks issued by respondent to complainants could no longer be

negotiated because the accounts against which they were drawn were no longer open a current account and they were the ones who proposed
already closed. When complainants called respondents attention, he that his wife and son issue the checks. Respondent further alleged that he
promised to pay the agreed interest for September and October 2006 but already started with the titling of Yulos lot but his services were
asked for a reduction of the interest to 7% for the succeeding months. terminated before it could be completed.

In November 2006, respondent withdrew as counsel for Yulo. On the other A supplemental complaint was filed charging respondent with accepting
hand, Presbitero terminated the services of respondent as counsel. cases while under suspension. In response, respondent alleged that he
Complainants then filed petitions for the judicial foreclosure of the accepted Presbiteros case in February 2006 and learned of his suspension
mortgages executed by respondent in their favor. Respondent countered only in May 2006.
that the 10% monthly interest on the loan was usurious and illegal.
Complainants also filed cases for estafa and violation of Batas Pambansa After conducting a hearing and considering the position papers submitted
Blg. 22 against respondent. by the parties, the IBP-CBD found that respondent violated the Code of
Professional Responsibility.
Complainants alleged that respondent induced them to grant him loans by
offering very high interest rates. He also prepared and signed the checks The IBP-CBD found that respondent borrowed P2,000,000 from Navarro
which turned out to be drawn against his sons accounts. Complainants and P1,000,000 from Presbitero which he failed to pay in accordance with
further alleged that respondent deceived them regarding the identity and the MOAs he executed. The IBP-CBD found that based on the documents
value of the property he mortgaged because he showed them a different presented by the parties, respondent did not act in good faith in obtaining
property from that which he owned. Presbitero further alleged that the loans. The IBP-CBD found that respondent either promised or agreed to
respondent mortgaged his 263-square-meter property to her pay the very high interest rates of the loans although he knew them to be
for P1,000,000 but he later sold it for only P150,000. exorbitant in accordance with jurisprudence. Respondent likewise failed to
deny that he misled Navarro and her husband regarding the identity of the
Respondent, for his defense, alleged that he was engaged in sugar and property mortgaged to them. Respondent also mortgaged a property to
realty business and that it was Yulo who convinced Presbitero and Navarro Presbitero for P1,000,000 but documents showed that its value was
to extend him loans. Yulo also assured him that Presbitero would help him only P300,000. Documents also showed that he sold that property for
with the refining of raw sugar through Victorias Milling Company, Inc. only P150,000. Respondent conspired with Yulo to secure loans by
Respondent alleged that Navarro fixed the interest rate and he agreed promising her a 10% commission and later claimed that they agreed that
because he needed the money. He alleged that their business transactions Yulo would "ride" on the loan by borrowing P300,000 from the amount he
were secured by real estate mortgages and covered by postdated checks. obtained from Navarro and Presbitero. Respondent could not explain how
Respondent denied that the property he mortgaged to Presbitero was less he lost all the money he borrowed in three months except for his claim that
than the value of the loan. He also denied that he sold the property the price of sugar went down.
because the sale was actually rescinded. Respondent claimed that the
property he mortgaged to Navarro was valuable and it was actually worth The IBP-CBD found that respondent misled Navarro and Presbitero
more than P8,000,000. regarding the issuance of the postdated checks, and there was nothing in
the records that would show that he informed them that it would be his
Respondent alleged that he was able to pay complainants when business wife or son who would issue the checks. The IBP-CBD also found that
was good but he was unable to continue paying when the price of sugar respondent had not been transparent in liquidating the money he received
went down and when the business with Victorias Milling Company, Inc. did in connection with Presbiteros VOS with DAR. He was also negligent in his
not push through because Presbitero did not help him. Respondent also accounting regarding the registration of Yulos property which was financed
denied that he was hiding from complainants. by Navarro.

Respondent further alleged that it was Yulo who owed him P530,000 as The IBP-CBD found that respondent was guilty of violating Rule 1.01 of the
interest due for September to December 2005. He denied making any false Code of Professional Responsibility for committing the following acts:
representations. He claimed that complainants were aware that he could


(1) signing drawn checks against the account of his son as if they Complainants filed a motion for reconsideration, praying that the penalty of
were from his own account; disbarment be instead imposed upon respondent.

(2) misrepresenting to Navarro the identity of the lot he mortgaged The only issue in this case is whether respondent violated the Code of
to her; Professional Responsibility.

(3) misrepresenting to Presbitero the true value of the 263-square- The records show that respondent violated at least four provisions of the
meter lot he mortgaged to her; Code of Professional Responsibility.

(4) conspiring with Yulo to obtain the loans from complainants; Rule 1.01 of the Code of Professional Responsibility provides:

(5) agreeing or promising to pay 10% interest on his loans although Rule 1.01. - A lawyer shall not engage in unlawful, dishonest, immoral or
he knew that it was exorbitant; and deceitful conduct.

(6) failing to pay his loans because the checks he issued were With respect to his client, Presbitero, it was established that respondent
dishonored as the accounts were already closed. agreed to pay a high interest rate on the loan he obtained from her. He
drafted the MOA. Yet, when he could no longer pay his loan, he sought to
The IBP-CBD also found that respondent violated Canon 16 and Rule 16.01 nullify the same MOA he drafted on the ground that the interest rate was
of the Code of Professional Responsibility when he failed to properly unconscionable. It was also established that respondent mortgaged a 263-
account for the various funds he received from complainants. square-meter property to Presbitero for P1,000,000 but he later sold the
property for only P150,000, showing that he deceived his client as to the
real value of the mortgaged property. Respondents allegation that the sale
In addition, the IBP-CBD found that respondent violated Rule 16.04 of the was eventually rescinded did not distract from the fact that he did not
Code of Professional Responsibility which prohibits borrowing money from a apprise Presbitero as to the real value of the property.
client unless the clients interest is fully protected or the client is given
independent advice.
Respondent failed to refute that the checks he issued to his client
Presbitero and to Navarro belonged to his son, Ivan Garcia Solidum III
On the matter of practicing law while under suspension, the IBP-CBD found whose name is similar to his name. He only claimed that complainants
that the records were not clear whether the notice of suspension knew that he could no longer open a current bank account, and that they
respondent received on 29 May 2006 was the report and recommendation even suggested that his wife or son issue the checks for him. However, we
of the IBP-CBD or the final decision of this Court. The IBP-CBD likewise are inclined to agree with the IBP-CBDs finding that he made complainants
found that there was insufficient evidence to prove that respondent believe that the account belonged to him. In fact, respondent signed in the
mishandled his cases. presence of Navarro the first batch of checks he issued to Navarro.
Respondent sent the second batch of checks to Navarro and the third batch
The IBP-CBD recommended that respondent be meted the penalty of of checks to Presbitero through a messenger, and complainants believed
disbarment. that the checks belonged to accounts in respondents name.

In Resolution No. XIX-2011-267 dated 14 May 2011, the IBP Board of It is clear that respondent violated Rule 1.01 of the Code of Professional
Governors adopted and approved the recommendation of the IBP-CBD with Responsibility. We have ruled that conduct, as used in the Rule, is not
modification by reducing the recommended penalty from disbarment to confined to the performance of a lawyers professional duties. 1 A lawyer
suspension from the practice of law for two years. The IBP Board of may be disciplined for misconduct committed either in his professional or
Governors likewise ordered respondent to return the amount of his unpaid private capacity.2 The test is whether his conduct shows him to be wanting
obligation to complainants. in moral character, honesty, probity, and good demeanor, or whether it
renders him unworthy to continue as an officer of the court. 3

In this case, the loan agreements with Navarro were done in respondents by the IBP-CBD, respondent had been less than diligent in accounting for
private capacity. Although Navarro financed the registration of Yulos lot, the funds he received from Navarro for the registration of Yulos property.
respondent and Navarro had no lawyer-client relationship. However,
respondent was Presbiteros counsel at the time she granted him a loan. It Unfortunately, the records are not clear whether respondent rendered an
was established that respondent misled Presbitero on the value of the accounting to Yulo who had since passed away.
property he mortgaged as a collateral for his loan from her. To appease
Presbitero, respondent even made a Deed of Undertaking that he would
give her another 1,000-square-meter lot as additional collateral but he As regards Presbitero, it was established during the clarificatory hearing
failed to do so. that respondent received P50,000 from Presbitero. As the IBP-CBD pointed
out, the records do not show how respondent spent the funds because he
was not transparent in liquidating the money he received from Presbitero.
Clearly, respondent is guilty of engaging in dishonest and deceitful
conduct, both in his professional capacity with respect to his client,
Presbitero, and in his private capacity with respect to complainant Navarro. Clearly, respondent had been negligent in properly accounting for the
Both Presbitero and Navarro allowed respondent to draft the terms of the money he received from his client, Presbitero.1wphi1Indeed, his failure to
loan agreements. Respondent drafted the MOAs knowing that the interest return the excess money in his possession gives rise to the presumption
rates were exorbitant. Later, using his knowledge of the law, he assailed that he has misappropriated it for his own use to the prejudice of, and in
the validity of the same MOAs he prepared. He issued checks that were violation of the trust reposed in him by, the client. 5
drawn from his sons account whose name was similar to his without
informing complainants. Further, there is nothing in the records that will Rule 16.04 of the Code of Professional Responsibility provides:
show that respondent paid or undertook to pay the loans he obtained from
complainants. Rule 16.04. - A lawyer shall not borrow money from his client unless the
clients interests are fully protected by the nature of the case or by
Canon 16 and Rule 16.01 of the Code of Professional Responsibility provide: independent advice. Neither shall a lawyer lend money to a client except,
when in the interest of justice, he has to advance necessary expenses in a
CANON 16. - A LAWYER SHALL HOLD IN TRUST ALL MONEYS AND legal matter he is handling for the client.
Here, respondent does not deny that he borrowed P1,000,000 from his
Rule 16.01 A lawyer shall account for all money or property collected or client Presbitero. At the time he secured the loan, respondent was already
received for or from the client. the retained counsel of Presbitero.

The fiduciary nature of the relationship between the counsel and his client While respondents loan from Presbitero was secured by a MOA, postdated
imposes on the lawyer the duty to account for the money or property checks and real estate mortgage, it turned out that respondent
collected or received for or from his client. 4 We agree with the IBP-CBD that misrepresented the value of the property he mortgaged and that the
respondent failed to fulfill this duty. In this case, the IBP-CBD pointed out checks he issued were not drawn from his account but from that of his son.
that respondent received various amounts from complainants but he could Respondent eventually questioned the terms of the MOA that he himself
not account for all of them. prepared on the ground that the interest rate imposed on his loan was
unconscionable. Finally, the checks issued by respondent to Presbitero
were dishonored because the accounts were already closed. The interest of
Navarro, who financed the registration of Yulos 18.85-hectare lot, claimed his client, Presbitero, as lender in this case, was not fully protected.
that respondent received P265,000 from her. Respondent countered Respondent violated Rule 16.04 of the Code of Professional Responsibility,
that P105,000 was paid for real estate taxes but he could not present any which presumes that the client is disadvantaged by the lawyers ability to
receipt to prove his claim. Respondent also claimed that he paid P70,000 to use all the legal maneuverings to renege on his obligation. 6 In his dealings
the surveyor but the receipt was only for P15,000. Respondent claimed with his client Presbitero, respondent took advantage of his knowledge of
that he paid P50,000 for filing fee, publication fee, and other expenses but the law as well as the trust and confidence reposed in him by his client.
again, he could not substantiate his claims with any receipt. As pointed out


We modify the recommendation of the IBP Board of Governors imposing on ANGELITA C. ORCINO, complainant,
respondent the penalty of suspension from the practice of law for two vs.
years. Given the facts of the case, we see no reason to deviate from the ATTY. JOSUE GASPAR, respondent.
recommendation of the IBP-CBD imposing on respondent the penalty of
disbarment. Respondent failed to live up to the high standard of morality, PUNO, J.:
honesty, integrity, and fair dealing required of him as a member of the
legal profession.7 Instead, respondent employed his knowledge and skill of
the law and took advantage of his client to secure undue gains for On June 14, 1992, complainant Angelita C. Orcino filed with this Court a
himself8 that warrants his removal from the practice of law. Likewise, we letter-complaint dated December 10, 1991 against respondent Atty. Josue
cannot sustain the IBP Board of Governors recommendation ordering Gaspar, her former counsel. Complainant prayed that this Court impose
respondent to return his unpaid obligation to complainants, except for disciplinary sanctions on respondent for abandoning his duties and for
advances for the expenses he received from his client, Presbitero, that failing to return the legal fees she fully paid for his services.
were not accounted at all. In disciplinary proceedings against lawyers, the
only issue is whether the officer of the court is still fit to be allowed to The complaint arose from the following facts: Complainant engaged the
continue as a member of the Bar.9 Our only concern is the determination of services of respondent to prosecute a criminal case she intended to file
respondents administrative liability.10 against several suspects in the slaying of her husband. In consideration
thereof, complainant bound herself to pay respondent legal fees of
Our findings have no material bearing on other judicial action which the P20,000.00 P10,000.00 to be paid upon signing of the contract and the
parties may choose to file against each other. 11 Nevertheless, when a balance to be paid on or before the conclusion of the case. Complainant
lawyer receives money from a client for a particular purpose involving the was also to pay P500.00 per appearance of respondent before the court
client-attorney relationship, he is bound to render an accounting to the and fiscal. This agreement was embodied in a contract executed on
client showing that the money was spent for that particular purpose. 12 If February 22, 1991. 1
the lawyer does not use the money for the intended purpose, he must
immediately return the money to his client. 13 Respondent was given an In accordance with the contract, complainant paid respondent the sum of
opportunity to render an accounting, and he failed. He must return the full P5,000.00 on February 25, 1991, 2 another P5,000.00 on March 31,
amount of the advances given him by Presbitero, amounting to P50,000. 1991, 3 and P10,000.00 on May 21, 1991, 4 for a total of P20,000.00.

WHEREFORE, the Court finds Atty. Ivan M. Solidum, Jr. GUILTY of violating Forthwith, respondent entered into his duties. He interviewed witnesses
Rule 1.01, Canon 16, Rule 16.01, and Rule 16.04 of the Code of and gathered evidence to build a case against the suspects. He drew up
Professional Responsibility. Accordingly, the Court DISBARS him from the the necessary sworn statements and dutifully attended the preliminary
practice of law effective immediately upon his receipt of this Decision. Atty. investigation. The case was thereafter filed with the Regional Trial Court,
Solidum is ORDERED to return the advances he received from Hilda S. Branch 37, Baloc, Sto. Domingo, Nueva Ecija. 5
Presbitero, amounting to P50,000, and to submit to the Office of the Bar
Confidant his compliance with this order within thirty days from finality of As private prosecutor, respondent religiously attended the bail hearings for
this Decision. Let copies of this Decision be furnished the Office of the Bar the accused although these hearings were postponed on motion of the
Confidant, the Integrated Bar of the Philippines for distribution to all its accused's counsel. Respondent however failed to attend the hearing
chapters, and the Office of the Court Administrator for dissemination to all scheduled in August 1991. It was at this nearing that the court, over
courts all over the country. Let a copy of this Decision be attached to the complainant's objections, granted bail to all the accused. After the hearing,
personal records of respondent. SO ORDERED. complainant immediately went to respondent's residence and confronted
him with his absence. 6Respondent explained that he did not receive formal
notice of the hearing. 7 Complainant became belligerent and started
accusing him of jeopardizing the case by his absence. Respondent said that
A.C. No. 3773 September 24, 1997 her suspicions were based on rumors and intrigues fed to her by her
relatives. 8 Complainant, however, continued accusing him belligerently.


She asked for the records of the case saying that she could refer them to xxx xxx xxx
another lawyer. Stung by her words, respondent gave her the records. 9
A lawyer may retire at any time from any action special proceeding with
Complainant never returned the records nor did she see respondent. On the written consent of his client filed in court and copy thereof served upon
September 18, 1991, respondent filed before the trial court a "Motion to the adverse party. Should the client refuse to give his consent, the lawyer
Withdraw as Counsel." 10 The motion did not bear the consent of must file an application with the court. The court, on notice to the client
complainant. and adverse party, shall determine whether he ought to be allowed to
retire. The application for withdrawal must be based on a good cause. 18
On October 23, 1991, the court issued an order directing respondent to
secure complainant's consent to the motion "and his appearance as private In the instant case, complainant did not give her written consent to
prosecutor shall continue until he has secured this consent." 11 respondent's withdrawal. The court thus ordered respondent to secure this
consent. Respondent allegedly informed the court that complainant had
Complainant refused to sign her conformity to respondent's become hostile and refused to sign his motion. 19 He, however, did not file
withdrawal. 12 Meanwhile, the hearings in the criminal case continued. an application with the court for it to determine whether he should be
Respondent did not appear at the hearings nor did he contact complainant. allowed to withdraw.
Complainant was thus compelled to engage the services of another lawyer.
Hence, the letter-complaint. Granting that respondent's motion without complainant's consent was an
application for withdrawal with the court, we find that this reason is
We referred the letter-complaint to the Integrated Bar of the Philippines, insufficient to justify his withdrawal from the case. Respondent's
Commission on Bar Discipline, for investigation, report and withdrawal was made on the ground that "there no longer exist[ed] the . . .
recommendation. confidence" between them and that there had been "serious differences
between them relating to the manner of private prosecution." 20
The rule in this jurisdiction is that a client has the absolute right to
terminate the attorney-client relation at any time with or without Rule 22.01 of Canon 22 of the Code of Professional Responsibility provides:
cause. 13 The right of an attorney to withdraw or terminate the relation
other than for sufficient cause is, however, considerably CANON 22 A LAWYER SHALL WITHDRAW HIS SERVICES ONLY FOR
restricted. 14 Among the fundamental rules of ethics is the principle that an GOOD CAUSE AND UPON NOTICE APPROPRIATE IN THE
attorney who undertakes to conduct an action impliedly stipulates to carry CIRCUMSTANCES.
it to its conclusion. 15 He is not at liberty to abandon it without reasonable
cause. 16 A lawyer's right to withdraw from a case before its final Rule 22.01 A lawyer may withdraw his services in
adjudication arises only from the client's written consent or from a good any of the following cases:
cause. 17
a) When the client pursues an illegal or immoral
Section 26 of Rule 138 of the Revised Rules of Court provides: course of conduct in connection with the matter he
is handling;
Sec. 26. Change of attorneys An attorney may retire at any time
from any action or special proceeding, by the written consent of his b) When the client insists that the lawyer pursue
client filed in court. He may also retire at any time from an action conduct violative of these canons and rules;
or special proceeding, without the consent of his client, should the
court, on notice to the client and attorney, and on hearing,
determine that he ought to be allowed to retire. In case of c) When his inability to work with co-counsel will
substitution, the name of the attorney newly employed shall be not promote the best interest of the client;
entered on the docket of the court in place of the former one, and
written notice of the change shall be given to the adverse party.

d) When the mental or physical condition of the require. 22 He must still appear on the date of hearing 23 for the attorney-
lawyer renders it difficult for him to carry out the client relation does not terminate formally until there is a withdrawal of
employment effectively; record. 24

e) When the client deliberately fails to pay the fees Respondent expressly bound himself under the contract to bring the
for the services or fails to comply with the retainer criminal case to its termination. He was in fact paid in full for his services.
agreement; Respondent failed to comply with his undertaking, hence, it is but fair that
he return to complainant half of the amount paid him. The peculiar
f) When the lawyer is elected or appointed to public circumstances of the case have rendered it impossible for respondent and
office; and complainant to continue their relation under the contract.

g) Other similar cases. IN VIEW WHEREOF, respondent is admonished to exercise more prudence
and judiciousness in dealing with his clients. He is also ordered to return to
complainant within fifteen (15) days from notice the amount of ten
A lawyer may withdraw his services from his client only in the following thousand pesos (P10,000.00) representing a portion of his legal fees
instances: (a) when a client insists upon an unjust or immoral conduct of received from the latter with a warning that failure on his part to do so will
his case; (b) when the client insists that the lawyer pursue conduct result in the imposition of stiffer disciplinary action. SO ORDERED.
violative of the Code of Professional Responsibility; (c) when the client has
two or more retained lawyers and the lawyers could not get along to the
detriment of the case; (d) when the mental or physical condition of the
lawyer makes him incapable of handling the case effectively; (e) when the
client deliberately fails to pay the attorney's fees agreed upon; (f) when the A.C. No. 6056 September 9, 2015
lawyer is elected or appointed to public office; (g) other similar cases.
The instant case does not fall under any of the grounds mentioned. Neither vs.
can this be considered analogous to the grounds enumerated. As found by Attys. JUAN B. MENDOZA and EUSEBIO P. NA VARRO,
the Commission on Bar Discipline, this case arose from a simple JR., Respondent.
misunderstanding between complainant and respondent. Complainant was
upset by respondent's absence at the hearing where bail was granted to DECISION
the suspected killers of her husband. She vehemently opposed the grant of
bail. It was thus a spontaneous and natural reaction for her to confront
respondent with his absence. Her belligerence arose from her VILLARAMA, JR., J.:
overzealousness, nothing more. Complainant's words and actions may
have hurt respondent's feelings considering the work he had put into the Before us is a complaint for disbarment against Atty. Juan B. Mendoza (Atty.
case. But her words were uttered in a burst of passion. And even at that Mendoza) for alleged deceitful acts against his client, and Atty. Eusebio P.
moment, complainant did not expressly terminate respondent's services. Navarro, Jr. (Atty. Navarro) for negligence in the handling of his client's
She made this clear when she refused to sign his "Motion to Withdraw as defense in the collection case filed by Atty. Mendoza.
Factual Antecedents
Assuming, nevertheless, that respondent was justified in terminating his
services, he, however, cannot just do so and leave complainant in the cold Eladio Mendoza (Eladio) applied for original registration of two parcels of
unprotected. The lawyer has no right to presume that his petition for land (Lot Nos. 3771 and 2489) situated in Calamba, Laguna before the
withdrawal will be granted by the court. 21 Until his withdrawal shall have Community Environment and Natural Resources Office (CENRO) at Los
been approved, the lawyer remains counsel of record who is expected by Banos, Laguna and Land Management Bureau (LMB) in Manila. 1 While his
his client as well as by the court to do what the interests of his client application was still pending, Eladio died leaving all his children as heirs to

his estate; among them is herein complainant Felicisima Mendoza Vda. De On March 29, 2000, the RTC rendered judgment in favor of Atty. Mendoza
Robosa (Felicisima). Eladio's children pursued the application and and against Felicisima and her siblings. The RTC ruled that Felicisima failed
executed a Special Power of Attomey 2 (SP A) in favor of Felicisima. Their to substantiate her claim that she did not enter into a contingency contract
relative, Atty. Mendoza, prepared and notarized the said SPA. They also for legal services with Atty. Mendoza, and ordered Felicisima to pay Atty.
engaged the services of Atty. Mendoza as their counsel in the proceedings Mendoza P1,258,000.00 (for the land sold at P7,120,800.00) representing
before the CENRO and LMB. attorneys fees as well as the total cost of suit. 7

On February 20, 1993, upon the behest of Atty. Mendoza, Felicisima signed Atty. Navarro then filed a Notice of Appeal 8on behalf of Felicisima. However,
a Contract for Service3 prepared by Atty. Mendoza. The said contract Atty. Mendoza moved for an execution pending appeal with the RTC. Since
stipulated that in the event of a favorable CENRO or LMB resolution, no opposition was filed by Felicisima and her siblings, the RTC granted the
Felicisima shall convey to Atty. Mendoza one-fifth () of the lands subject said motion and issued a writ of execution, which resulted in the levy and
of the application or one-fifth () of the proceeds should the same eventual transfer of Felicisimas properties covered by Transfer Certificate
property be sold. of Title Nos. T-433859 and T-433860 in favor of Atty. Mendoza as the
highest bidder in the execution sale.9
The CENRO and the LMB proceedings resulted in the dismissal of Felicisima
and her siblings application for Lot No. 2489 and the partial grant of their Meanwhile, the Court of Appeals (CA) ordered Felicisima to file an
application for Lot No. 3771.4 The Bureau of Lands issued an Original appellants brief but Atty. Navarro failed to file the same within the period
Certificate of Title (OCT) covering one-third () or about 8,901 square granted by the CA. Consequently, the CA dismissed Felicisimas appeal for
meters of Lot No. 3771 in the names of Felicisima and her siblings. non-compliance with Section 1(e), Rule 50 of the Revised Rules of Court. 10
Subsequently, Felicisima and her siblings sold the land to Greenfield
Corporation (Greenfield) and received the amount of P2,000,000.00 as On June 3, 2003, Felicisima filed a complaint-affidavit for disbarment before
down payment. this Court against Atty. Mendoza for allegedly deceiving her into signing
the Contract for Service by taking advantage of her illiteracy, and against
On October 15, 1998, Atty. Mendoza, joined by his wife Filomena S. Atty. Navarro for dereliction of duty in handling her case before the CA
Mendoza, filed in the Regional Trial Court (RTC) of Tanauan, Batangas a causing her properties to be levied and sold at public auction. 11
Complaint5 against Felicisima and her siblings (Civil Case No. T-1080).
Felicisima alleges that Atty. Mendoza made her sign a document at her
Atty. Mendoza claimed that except for the amount of P40,000.00, Felicisima house without the presence of her siblings. Said document (Contract for
and her siblings refused to pay his attorneys fees equivalent to of the Service) was written in English which she does not understand. She claims
proceeds of the sale of the land as stipulated in the Contract for Service. that Atty. Mendoza told her the document will shield her from her siblings
possible future claims on the property because she alone is entitled to the
In their Answer with Counterclaim,6 Felicisima and her siblings denied the property as her siblings did not help her in processing the application for
"existence and authenticity of the x x x Contract of Service," adding that it original registration. She was not given a copy of the said document and
did not reflect the true intention of the parties as they only agreed to pay she discovered only during the trial that Atty. Mendoza anchors his claim
Atty. Mendoza P1,500.00 per appearance and up to P1,500.00 for gasoline over of proceeds from the sale of the land awarded by the CENRO and
expenses. They also asserted that, based on quantum meruit, Atty. LMB on the same document she had signed.12
Mendoza is not entitled to the claimed attorneys fees because they lost in
one case and he failed to accomplish the titling of the land awarded to As to Atty. Navarro, Felicisima claims that her case before the CA was
them, which would have enhanced the value of the property. neglected despite repeated follow-ups on her part. She also points out that
Atty. Navarro abandoned her case before the RTC when the latter failed to
Felicisima and her siblings hired the services of Atty. Navarro as their file an opposition to Atty. Mendozas motion for execution pending appeal,
counsel in Civil Case No. T-1080. which resulted in the loss of her properties.13


In his Comment,14 Atty. Mendoza avers that he has been a lawyer since at the CA. He claims that Felicisima blamed her and even accused him of
1954 and retired sometime in 1983 due to partial disability. He went back conniving with Atty. Mendoza. Felicisima would not accept his explanation
to practicing his profession in 1996 on a selective basis due to his disability and she obviously failed to understand his earlier instruction as he had
but completely stopped a year after. Being 82 years of age at the time of filed the Notice of Appeal precisely to give her enough time to secure the
filing his comment, Atty. Mendoza admits that he is now totally disabled, services of a new lawyer having told her that he was quite busy with his
cannot walk on his own, cannot even write and sign his name, and can only other cases. He therefore pleads for mercy and compassion if he had
move about with the help of his family for he has been suffering from a somehow committed some lapses considering that this is the first time he
severe case of "acute gouty arthritic attack" which causes extreme was charged administratively in his almost 39 years of law practice and
difficulty in moving virtually all his joints. He points out that he had that he is too willing to take complainants cause if not for such apparent
previously handled pro bono a concubinage case filed by Felicisima against miscommunication between a lawyer and his client. 15
her husband, having yielded to her repeated pleas as she was then
financially hard-up and psychologically distraught. For the application with On December 7, 2005, the Court referred the case to the Integrated Bar of
the CENRO and LMB, he agreed to be paid for his legal services on a the Philippines (IBP) for investigation, report and recommendation. 16
contingent basis, which contract was subsequently found by the RTC to be
valid. When it was time to collect his attorneys fees, Felicisima and her
siblings refused to pay him without any justifiable reason and even On November 6, 2006, Felicisima filed a position paper 17 reiterating that
threatened to shoot him if he continued to press for his compensation. This Atty. Mendoza clearly abused the trust and confidence she reposed in him,
left Atty. Mendoza with no other recourse but to avail of the judicial process depriving her of her material possessions by filing suit to enforce the
to enforce his claim. Contract for Service. She asserted that they could not have entered into a
contract with Atty. Mendoza for the conveyance of a portion of the land to
be awarded by the Bureau of Lands as his attorneys fees because they
Replying to the comment of Atty. Mendoza, Felicisima maintains that she already agreed to pay his fee per hearing plus transportation expenses and
did not understand the contents of the Contract for Service and if it was the sum of P40,000.00. She contended that Atty. Mendoza should be held
truly their agreement (contingent basis) they would not have given money liable for deceit and misrepresentation for tricking her to sign, to her
to Atty. Mendoza amounting to P66,000.00. In fact, she points out that Atty. detriment, a document that she did not understand.
Mendoza failed to recover one of the lands applied for and to have the land
awarded to them titled because he became ill. Further, she denies the
allegation that she and her siblings threatened to shoot Atty. Mendoza for As to Atty. Navarro, Felicisima maintained that he abandoned his
how could they do it to a lawyer who will certainly have them jailed. responsibility to monitor and keep her updated of the status of her case
Besides, he never mentioned such incident during the hearing of the case. before the CA. She also alleges that Atty. Navarro made it appear to her
that he had already filed the appellants brief when, in fact, there was no
such undertaking. She thus prayed that Atty. Navarro be held liable for
On his part, Atty. Navarro asserts that he did his best to win Felicisimas negligence in the conduct and manner of handling her case before the CA.
case although he was unsuccessful. He explains that even before handling
Felicisimas case, he had been saddled by many cases involving politicians
and sympathizers, having previously served as councilor in the Municipality IBPs Report and Recommendation
of Sto. Tomas, Batangas for two consecutive terms. He thus emphasized to
Felicisima that in order to "keep the case alive", he could file the Notice of After two postponements, the mandatory conference was finally held on
Appeal in her behalf, and instructed her to look for another lawyer who has September 25, 2006 where all parties appeared except for Atty. Mendoza.
the time to attend to her case and that she would return to him only when Upon termination of the hearing, the parties were required to file their
she failed to get one. However, Atty. Navarro admits that since he was too position papers but only Felicisima complied.
preoccupied with so many cases in the local courts, he had altogether
forgotten about Felicisimas case, not having seen her again as per their On March 6, 2007, the Investigating Commissioner of the IBP Commission
agreement. on Bar Discipline (CBD) submitted her Report and
Recommendation18 finding Atty. Mendoza guilty of taking advantage of
Atty. Navarro avers that after a long time Felicisima suddenly showed up at Felicisimas ignorance just to have the Contract for Service signed. She
his office complaining why there was no appellants brief filed on her behalf held that Atty. Mendoza violated Canon 17 of the Code of Professional


Responsibility (CPR) that a lawyer owes fidelity to the cause of his client She claims that despite several demands, Atty. Navarro ignored them and
and shall be mindful of the trust and confidence reposed on him, as well as made himself scarce.24
Rule 20.04, Canon 20 which exhorts lawyers to avoid controversies with
clients concerning matters of compensation and to resort to judicial action On February 28, 2012, the IBP-CBD forwarded the case to this Court for
only to prevent imposition, injustice or fraud.19 proper disposition pursuant to Section 12, Rule 139-B of the Rules of Court.
Among the records transmitted was the Resolution dated January 15, 2012
As to Atty. Navarro, the Investigating Commissioner held that his denying the motion for reconsideration filed by Atty. Navarro. 25
participation in politics affected his law practice and caused him to forget
about Felicisimas case. Having failed to file the appellants brief as ordered The Courts Ruling
by the CA, Atty. Navarro even filed a Motion to Withdraw Appearance at a
very late stage, leaving no time for Felicisima to secure the services of
another lawyer. His infraction caused the eviction of Felicisima and her The Court has consistently held that in suspension or disbarment
children from their residence by virtue of the writ of execution and public proceedings against lawyers, the lawyer enjoys the presumption of
auction of her real properties. The Investigating Commissioner further said innocence, and the burden of proof rests upon the complainant to prove
that Atty. Navarros acts showed lack of diligence in violation of Canon 18 the allegations in his complaint. The evidence required in suspension or
of the CPR and his Lawyers Oath.20 disbarment proceedings is preponderance of evidence. In case the
evidence of the parties are equally balanced, the equipoise doctrine
mandates a decision in favor of the respondent. 26 For the Court to exercise
The Investigating Commissioner recommended that both Atty. Mendoza its disciplinary powers, the case against the respondent must be
and Atty. Navarro be suspended for two (2) years from the practice of law. 21 established by clear, convincing and satisfactory proof. 27

On September 19, 2007, the IBP Board of Governors issued a Preponderance of evidence means that the evidence adduced by one side
Resolution22 modifying the Investigating Commissioners Report and is, as a whole, superior to or has greater weight than that of the other. 28 It
Recommendation by lowering the period of suspension from two (2) years means evidence which is more convincing to the court as worthy of belief
to six (6) months. than that which is offered in opposition thereto. 29 Under Section 1 of Rule
133, in determining whether or not there is preponderance of evidence, the
Atty. Navarro filed a motion for reconsideration 23 contending that the IBP court may consider the following: (a) all the facts and circumstances of the
Board of Governors failed to consider that after the filing of the Notice of case; (b) the witnesses manner of testifying, their intelligence, their
Appeal, there was no more lawyer-client relationship between him and means and opportunity of knowing the facts to which they are testifying,
Felicisima. Insisting that there was a miscommunication between him and the nature of the facts to which they testify, the probability or improbability
Felicisima regarding his instruction that she should engage the services of of their testimony; (c) the witnesses interest or want of interest, and also
another lawyer after the filing of the Notice of Appeal, he stressed that she their personal credibility so far as the same may ultimately appear in the
only later found it difficult to scout for a new lawyer because she was being trial; and (d) the number of witnesses, although it does not mean that
charged exorbitant acceptance fees. Hence, Felicisima should be held preponderance is necessarily with the greater number.
equally negligent in not hiring the services of another lawyer despite a
clear understanding to this effect. He further cites the lack of After a thorough review of the evidence and pleadings submitted by the
communication between him and Felicisima, which resulted in the late parties, we hold that Felicisima was able to prove her charges against Atty.
filing of the Notice of Withdrawal that she volunteered to file a long time Navarro but not Atty. Mendoza.
Contract for Service with Atty.
In her comment to Atty. Navarros motion for reconsideration, Felicisima Mendoza a contract for contingent
reiterated that Atty. Navarro should be held liable for negligence in failing Fees
to update her of the status of the case and admitting such oversight.
The Contract for Service dated February 20, 1993 reads:


That the client hereby employs the Attorney as their counsel for the titling P1,424,000.00 minus the amount of P40,000.00 he received, or the amount
and recovery of their two parcels of land situated at Barangay Maunong, of P1,384,000.00.
Calamba, Laguna, [Lot] No. 2489 with an area of approximately 21,784
Square Meters and [L]ot No. 3771 with an area of more or less 26,703 and During her testimony, Felicisima Mendoza admitted the authenticity of the
in consideration of the services of the client agrees to pay the following: Special Power of Attorney whereby her brothers and sisters authorized her
to secure the services of the plaintiff Juan Mendoza adding that it was in
1. For the prosecution of said proceedings (titling and recovery of the said writing, in English and was explained to her before she signed it; that on
parcels of land and hearing at the Land Management Bureau, Manila, and the basis of the authority given sisters she engaged the services of Atty.
at the Office of the Community Environment and Natural Resources Office Mendoza; that the signature in the document, entitled Contract of Service,
at Los Baos, Laguna the client will give the Attorney one fifth (1/5[)] of the is that of her name which she signed in "his house."
said two parcels of land or one fifth (1/5[)] of the selling price of the said
properties if sold. On the basis of the evidence, the Court finds no ground to support
Felicisimas claim that she did not enter into any written agreement with
Said Attorney hereby accepts said employment on said terms and the plaintiff, Juan Mendoza, for the latter to render legal services and the
conditions and to do his best care, skill and ability, and at all times to corresponding compensation therefor as set forth in the Contract of
protect the rights and interest of said client. Service. However, the Court finds that the amounts received by the
plaintiff Juan Mendoza from defendant Felicisima Mendoza during the
2. That the expenses of the proceedings, and such others as filing fees, course of his legal services for the twenty hearings in the amount of
expenses of publication, costs legally taxable and all others shall be for the P1,300.00 per hearing or a total of P26,000.00 should also be deducted
account of the client.30 from his claim of P1,384,000.00 leaving an unpaid balance of
P1,258,000.00 due plaintiff Juan Mendoza for legal services rendered the
We cannot sustain the finding of the IBP that Atty. Mendoza misled
Felicisima into signing the above contract which supposedly was intended
to protect her from the claims of her siblings who did not spend for the Given the above finding of the RTC that Felicisima in fact entered into a
application with the CENRO and LMB. Such finding was based solely on the contract for legal services with Atty. Mendoza, thus debunking her defense
statements of Felicisima in her affidavit-complaint. While Felicisima made a in her Answer denying the existence and authenticity of the said
reference to her testimony before the RTC, she did not attach the transcript document, it appears that Felicisima raised the issue of voluntariness of
of stenographic notes of the said testimony detailing the circumstances of her signing the Contract for Service only during the hearing when she
her signing the Contract for Service. Neither is the receipt by Atty. Mendoza supposedly testified that, having reached only Grade IV and trusting
of the sum of P40,000.00 after Felicisima and her siblings sold the land, by completely her lawyer cousin, Atty. Mendoza who told her that the
itself an indication of fraud and deceit in the execution of the Contract for document will protect her from the claims of her siblings, she actually
Service. signed the Contract for Service. 32 The RTC, however, found the evidence
adduced by Felicisima as insufficient to defeat Atty. Mendozas claim for
attorneys fees. Said judgment had attained finality and even pending
Upon the other hand, Atty. Mendoza presented the RTC Decision in Civil appeal was already executed on motion by Atty. Mendoza.
Case No. T-1080 dated March 29, 2000, the relevant portions of which
It bears to stress that a contingent fee arrangement is valid in this
jurisdiction and is generally recognized as valid and binding but must be
It is not disputed that Atty. Mendoza was paid P1,000.00 for every laid down in an express contract. 33 The validity of contingent fees depends,
appearance and he was also given P300.00 for hiring a vehicle and driver in large measure, upon the reasonableness of the amount fixed as
for each scheduled hearing. He also received P40,000.00 from Felicisima contingent fee under the circumstances of the case. 34Nevertheless, when it
Mendoza when defendants one-third portion of Lot No. 3771 was sold. is shown that a contract for a contingent fee was obtained by undue
influence exercised by the attorney upon his client or by any fraud or
Atty. Mendoza filed the instant case to collect one-fifth of the sale price of imposition, or that the compensation is clearly excessive, the Court must,
defendants land which was sold for P7,120,800.00 or the amount of and will protect the aggrieved party.35

Apart from the allegations in her affidavit-complaint, Felicisima failed to Once he agrees to take up the cause of a client, a lawyer owes fidelity to
establish by clear and satisfactory proof of the deception allegedly such cause and must always be mindful of the trust and confidence
committed by Atty. Mendoza when she agreed in writing for the latters reposed in him. He must serve the client with competence and diligence
contingent fees. Fraud and irregularity in the execution of their contingency and champion the latters cause with wholehearted fidelity, care and
fee contract cannot be deduced from the fact alone that Atty. Mendoza devotion. Elsewise stated, he owes entire devotion to the interest of the
filed suit to enforce their contract. client, warm zeal in the maintenance and defense of his clients rights, and
the exertion of his utmost learning and ability to the end that nothing be
Atty. Navarros Gross Negligence taken or withheld from his client, save by the rules of law, legally applied.
This simply means that his client is entitled to the benefit of any and every
remedy and defense that is authorized by the law of the land and he may
With respect to Atty. Navarro, the facts on record clearly established his expect his lawyer to assert every such remedy or defense. If much is
failure to live up to the standards of diligence and competence of the legal demanded from an attorney, it is because the entrusted privilege to
profession. practice law carries with it the correlative duties not only to the client but
also to the court, to the bar and to the public. A lawyer who performs his
Lawyers engaged to represent a client in a case bear the responsibility of duty with diligence and candor not only protects the interest of his client;
protecting the latters interest with warmth, zeal and utmost he also serves the ends of justice, does honor to the bar and helps
diligence.36 They must constantly keep in mind that their actions or maintain the respect of the community to the legal profession. 38
omissions would be binding on the client.37
Atty. Navarros asseveration that he had instructed Felicisima to look for
In this case, Atty. Navarro agreed to represent Felicisima and her siblings in another lawyer and given them the Notice of Withdrawal of Appearance for
Civil Case No. T-1080 and as their counsel he filed the Answer with them to file in the CA, fails to convince. If it is true that he did not agree to
Counterclaim. He likewise attended the hearings of the case until the RTC continue being Felicisimas counsel before the CA, he should have
rendered an adverse judgment. However, after filing the Notice of Appeal, immediately filed the Notice of Withdrawal of Appearance himself after
nothing was heard of again from him. He did not file any opposition when filing the Notice of Appeal. Despite receipt of the order to file appellants
Atty. Mendoza moved for execution pending appeal, which resulted in the brief from the CA, he did not inform Felicisima about it nor did he inquire
sale of Felicisimas properties at public auction and eventual eviction of from the latter whether they already secured the services of a new
Felicisima and her children from the said premises. Worse, he failed to file counsel. That such withdrawal was filed long after the expiration of the
an appellants brief despite receipt of the order from the CA directing him period to file appellants brief and the denial by the CA of the motion for
to do so within the period specified therein, and to file a motion for extension also belatedly filed by him, clearly indicate that he never
reconsideration when the appeal was dismissed due to non-filing of such updated Felicisima on the status of their appeal, such information being
brief. His motion for extension of time to submit an appellants brief was crucial after Atty. Mendoza succeeded in having the judgment executed
filed 93 days late and was thus denied by the CA. Barely a week after, he pending appeal.
filed a notice of withdrawal of appearance bearing the conformity of his
clients which was granted. It is evident from the foregoing that Atty. Atty. Navarro, in fact, admitted that he forgot about Felicisimas case due
to his political activities. Despite having received notices from the CA, he
Navarro failed to inform Felicisima of the status of the case so that the allowed the period of filing the appellants brief to lapse and failed to file a
latter was surprised upon being served the eviction order of the court and motion for extension before such period expired. He did file a motion for
eventual dismissal by the CA of their appeal. extension but only three months later and when such motion was denied,
he finally moved to withdraw from the case. There being no appellants
Canon 18 of the CPR mandates that a lawyer shall serve his client with brief filed, the CA granted Atty. Mendozas motion to dismiss the appeal.
competence and diligence.1wphi1 Rule 18.03 further provides that a Under the circumstances, Atty. Navarro was grossly negligent in his duties,
lawyer shall not neglect a legal matter entrusted to him and his negligence resulting in great prejudice to Felicisima who lost her properties to satisfy
in connection therewith shall render him liable. the judgment in favor of Atty. Mendoza.


We have held that the failure of counsel to submit the appeal brief for his misconduct that seriously affects the standing and character of the lawyer
client within the reglementary period constitutes inexcusable as an officer of the court and a member of the bar.45
negligence,39 an offense that entails disciplinary action. 40 The filing of a
brief within the period set by law is a duty not only to the client, but also to WHEREFORE, the Court finds respondent Atty. Eusebio P. Navarro, Jr. GUILTY
the court.41 The failure to file an appellate court brief without any justifiable of violation of Rule 18.03 and Rule 18.04 of the Code of Professional
reason thus deserves sanction.42 Responsibility, and is hereby SUSPENDED from the practice of law for six
(6) months effective upon finality of this Decision, with warning that a
Atty. Navarros negligent handling of Felicisimas case was exacerbated by repetition of the same or similar violation shall be dealt with more severely.
his failure to inform her of the status of her case. There was no mention in The charges against Atty. Juan B. Mendoza are DISMISSED.
his pleadings of any attempt on his part to contact Felicisima at the crucial
stages when Atty. Mendoza moved for execution pending appeal and the SO ORDERED.
CA sent a directive for the filing of the appellants brief. If indeed, he had
already instructed Felicisima to look for another lawyer, he should have
apprised her of these developments and explained to her the urgency of
filing the notice of withdrawal of appearance and entry of appearance of a
new counsel she may have already engaged.

Atty. Navarro's failure to communicate vital information to his client

violated Rule 18.04 which provides:

Rule 18.04 A lawyer shall keep the client informed of the status of his case
and shall respond within a reasonable time to the client's request for

The lawyer's duty to keep his client constantly updated on the

developments of his case is crucial in maintaining the client's confidence.
Indeed, the relationship of lawyer-client being one of confidence, there is
ever present the need for the lawyer to infonn timely and adequately the
client of important developments affecting the client's case. The lawyer
should not leave the client in the dark on how the lawyer is defending the
client's interests.43

In cases involving a lawyer's failure to file a brief or other pleading before

an appellate court, this Court has imposed suspension from the practice of
law for periods ranging from three to six months, and in most serious
cases, even disbannent.44

We find the recommendation of the IBP-Board of Governors to suspend

Atty. Navarro from the practice of law for six months appropriate under the
circumstances. Considering that this is his first administrative offense, such
penalty, and not disbarment as prayed for by complainant, serves the
purpose of protecting the interest of the public and the legal profession.
For this Court will exercise its power to disbar only in clear cases of


Caldwell, Memphis, for Defendant-Appellant, Ryland. Dale H. Tuttle,

Memphis, for Amicus Curiae, Tennessee Defense Lawyers Association.

The United States District Court for the Western District of Tennessee has
certified the following questions to this Court pursuant to Rule 23 of the
Tennessee Supreme Court:1

1.Whether a contract between a personal injury plaintiff and his

physician to pay the physician a fee contingent on the outcome of litigation
for the coordination of and consultation with respect to the medico/legal
aspects of the lawsuit, including potentially the giving of expert medical
testimony at trial, is enforceable under the laws of Tennessee;

2. Whether a contract between a personal injury plaintiff and his

physician to pay the physician a fee contingent on the outcome of litigation
for medical services and treatment (i.e., actual care and treatment for the
injuries) to the plaintiff/patient is enforceable under the laws of Tennessee;

3. If either or both of the above contracts are unenforceable, whether the

physician may recover on a quantum meruit theory for the expert and/or
medical services.

We accepted these important legal questions of first impression under Rule

23 and, in response, conclude that a contract requiring a party to pay a
physician a fee for medico-legal expert services and/or medical treatment
that is contingent on the outcome of litigation is contrary to public policy in
this state and therefore void. We also conclude that under the facts of
this case, payment for the physician's expert services and/or medical
treatment pursuant to a theory of quantum meruit is not appropriate.

On June 21, 1990, the defendant, Robert G. Harris, a resident of Mississippi,

was injured in an automobile accident occurring in Louisiana. Harris filed
a lawsuit against several defendants in Tennessee in connection with the
Supreme Court of Tennessee,at Nashville. accident, and the case was removed to the United States District Court for
Greg SWAFFORD, M.D., Plaintiff/Appellee, v. Robert G. Greg the Western District of Tennessee. Harris went to the plaintiff, Dr. Greg
HARRIS, and Darrell R. Ryland, Individually and P.C., Swafford of Memphis, Tennessee, for treatment of a cold and his injuries.
The injured Harris and the physician Swafford entered into two contractual
Decided: March 16, 1998 agreements. The first was an oral agreement between Harris and Dr.
William J. Simmons, Memphis, for Plaintiff-Appellee. Marc E. Overlock, Swafford whereby Dr. Swafford would act as medico/legal consultant and
Nashville, for Amicus Curiae, Tennessee Medical Association. William L. assist with the preparation of Harris's personal injury suit in return for
Bomar, Glankler Brown, PLLC, Memphis, for Defendant-Appellant, Harris. 151/313 percent of any monetary recovery received by Harris. The
George T. Lewis, III, Bradley E. Trammell, Baker, Donelson, Bearman & agreement was reduced to writing on April 16, 1995.


The second agreement, entitled Medical Reports and Doctor's Lien, was We first examine the American Medical Association Code of Ethics, 6.01,
entered into in August of 1994. This agreement, which was signed by which condemns contingency fees for the provision of medical services:
Harris and his attorney, Darrell Ryland, required Ryland to pay Dr. Swafford
any money owed to him for medical services provided to Harris. This Contingent Physician Fees: If a physician's fee for medical services is
agreement, according to the District Court's order of certification, was not contingent on the successful outcome of a claim, such as a malpractice or
contingent on the outcome of the personal injury litigation. worker's compensation claim, there is the ever present danger that the
physician may become less of a healer and more of an advocate or
In preparation for the trial, Dr. Swafford testified at one deposition relating partisan in the proceedings. Accordingly, a physician's fee for medical
to Harris's personal injury claim and also, according to the complaint, service should be based on the value of the service provided by the
provided medical consultation, treatment, and services. When Harris's physician to the patient and not on the uncertain outcome of a contingency
personal injury claim settled for $625,000, Dr. Swafford demanded 151/313 that does not in any way relate to the value of the medical service.
percent as provided in the first contract. When he was not paid, Dr.
Swafford filed suit for breach of contract against Harris and his attorney Similarly, although the Code of Ethics recognizes that as a citizen and as a
Ryland, as well as a suit for inducement to breach a contract against professional with special training and experience, the physician has an
Ryland. ethical obligation to assist in the administration of justice, it again
prohibits the use of a contingency fee by a medical witness:
The parties dispute the nature of the contractual agreements. Harris and
Attorney Ryland contend that the agreement for medico-legal services was [t]he medical witness must not become an advocate or a partisan in the
a contingency fee contract, while the agreement for medical treatment was legal proceeding. The medical witness should be adequately prepared
not a contingency fee contract. Dr. Swafford, on the other hand, argues and should testify honestly and truthfully. The attorney for the party who
that the contingency fee contract included medico-legal services as well as calls the physician as a witness should be informed of all favorable and
medical treatment services. He also contends that if the contingency fee unfavorable information developed by the physician's evaluation of the
contract is unenforceable, he is entitled to recovery under a quantum case. It is unethical for a physician to accept compensation that is
meruit theory. contingent upon the outcome of litigation.

The District Court, finding that a response to the questions of law set forth American Medical Association Code of Ethics, 9.07 (emphasis added).
above would substantially dispose of the case, certified the questions to
this Court pursuant to Rule 23 of the Tennessee Supreme Court. We The AMA Code has been adopted as a regulatory policy by the Tennessee
agreed to review these important questions of first impression. Board of Medical Examiners, the Tennessee statutory agency charged with
the licensing and supervision of physicians in this jurisdiction. The Board
CONTINGENCY FEE FOR CONSULTING AND EXPERT TESTIMONY of Medical Examiners has the statutory responsibility and authority to
deny, suspend, or revoke a license for, among other things,
The defendants, Harris and his attorney Ryland, relying on extensive unprofessional, dishonorable or unethical conduct. Tenn.Code Ann. 63-
authority in Tennessee and elsewhere, contend that a contingency fee 6-214(b)(1)(1997).2 Accordingly, a violation of the AMA Code constitutes
contract for the expert services of a physician is contrary to sound public unprofessional conduct and violates public policy established by the
policy and void. Dr. Swafford, although not challenging this authority, Tennessee Board of Medical Examiners.
contends that at the time of contracting, there was no existing law in
Tennessee, and no guidelines applicable to him, which [gave] notice [of] The Supreme Court, under its inherent and statutory authority, governs the
any public policy against contingency fee contracts. admission and discipline of attorneys in this State. See, e.g., Dockery v.
Bd. of Professional Responsibility, 937 S.W.2d 863 (Tenn.1996). The Code
We begin our analysis by determining whether the contingent fee contract of Professional Responsibility and Disciplinary Rules governing the conduct
violated existing Tennessee public policy and if so, how such policy was of attorneys are a part of the Rules of the Supreme Court. Tenn. Sup.Ct. R.
established. 8. Disciplinary Rule 7-109(C) of the Code of Professional Responsibility
provides that a lawyer shall not pay, offer to pay, or acquiesce in the
payment of compensation to a witness contingent upon the content of the


witness's testimony or the outcome of a case. (Emphasis added). to swell the damages so likely to color his testimony as to be inimical to
Similarly, ethical consideration 7-28 provides: the pure administration of justice, and therefore invalid.

Witnesses should always testify truthfully and should be free from any Id. (quoting, Sherman v. Burton, 165 Mich. 293, 130 N.W. 667 (1911)).
financial inducements hat might tempt them to do otherwise. A lawyer
should not pay or agree to pay a non-expert witness an amount in excess In a New Jersey case, Polo v. Gotchel, 225 N.J.Super. 429, 542 A.2d 947
of reimbursement for expenses and financial loss incident to being a (1987), the plaintiffs contracted with a medical-legal consulting service
witness; however, a lawyer may pay or agree to pay an expert witness a that was to locate medical experts to provide opinions and testimony as to
reasonable fee for services as an expert. But in no event should a lawyer medical aspects of the plaintiff's malpractice suit. In return, the
pay or agree to pay a contingent fee to any witness. defendant was to receive a contingency fee of 6 percent of the plaintiff's
gross recovery. In deciding the enforceability of the contract, the New
(Emphasis added). In our view, these provisions of the Code of Jersey Supreme Court considered the AMA Code of Ethics provisions that
Professional Responsibility, promulgated by the Supreme Court and condemn contingency fees, a New Jersey statute that prohibited the use of
authorized by the Tennessee Constitution and statutes, reflect public contingency fees by physicians, and sections of the Code of Professional
policy, just as it is reflected in the American Medical Association Code of Responsibility that prohibit an attorney from sharing a contingency fee with
Ethics. See, e.g., Spiegel v. Thomas, Mann & Smith, P.C., 811 S.W.2d 528, a non-lawyer. After observing that the 6 percent fee invaded the plaintiff's
531 (Tenn.1991)(holding that a contract which violated sections of the right of recovery and that the defendant's service would not exist but for
Code of Professional Responsibility was void as against the public policy of the participation of doctors, the Court concluded that the contract was void
Tennessee.). as against public policy. Id. at 948-49.

Accordingly, the medical and legal communities share the ethical Similar public policy concerns have been emphasized by courts and
prohibition against the use of contingency fees for expert witnesses which commentators with regard to contingency fee contracts with other types of
is contained in the respective professional codes for each profession and experts as well. For example, in Belfonte v. Miller, 212 Pa.Super. 508, 243
adopted by the State as the public policy of Tennessee. This public policy A.2d 150 (1968), the court invalidated a 10 percent contingency fee for the
is re-enforced by the actions of the Tennessee Bar Association and the services of a real estate appraiser, stating that improper conduct or bias
Tennessee Medical Association in adopting the Interprofessional Code of can be predicted easily when the compensation of the witness is directly
Cooperation, which provides in part that [u]nder no circumstances may a related to the absolute amount of an award which may in turn be
physician charge or accept compensation for any service which is dependent to a great degree on the testimony of that same witness. Id.
contingent upon the outcome of a lawsuit. Article VI, 2. at 153; see also New England Telephone and Telegraph Co. v. Board of
Assessors, 392 Mass. 865, 468 N.E.2d 263, 265 (1984)(the majority rule in
Courts from other jurisdictions have likewise relied upon professional codes this country is that an expert witness may not collect compensation which
in concluding that contingency fees for expert medical witnesses are by agreement was contingent on the outcome of the controversy.);
unenforceable as against sound public policy. For example, in Dupree v. Restatement of Contracts 552(2)(a bargain to pay an expert witness for
Malpractice Research, Inc., 179 Mich.App. 254, 445 N.W.2d 498 (1989), testifying to his opinion is illegal if the agreed compensation is
contracts were executed whereby the defendant, Malpractice Research, contingent on the outcome of the controversy.); cf. Ojeda v. Sharp
Inc., provided expert testimony and advice in connection with the plaintiff's Cabrillo Hospital, 8 Cal.App.4th 1, 10 Cal.Rptr.2d 230 (1992)(contingency
medical malpractice action in exchange for payment of costs and 20% of fee contract with medical consulting service not per se void). 3
the plaintiff's recovery. The Court of Appeals, citing professional codes in
the medical and legal professions, ruled that the contracts were against Given this overwhelming weight of authority, we disagree with Dr.
public policy because they threaten[ed] the legitimate recoveries of Swafford's contention that no controlling public policy existed or that the
injured plaintiffs and imperil[ed] defendants and the fundamental truth- public policy was not applicable simply because he is not a member of the
seeking mission of our court system. Id. at 502. The Court also American or Tennessee Medical Associations. On the contrary, it is our
reasoned: view that sound public policy in this jurisdiction, as in others, is crystal
clear: a contingency fee contract for the services of a physician acting in a
The [expert's] interest in the amount of the damages furnished a powerful medico-legal expert capacity is void as against public policy and therefore
motive for exaggeration, suppression, and misrepresentation, a temptation unenforceable.

CONTINGENCY FEE FOR MEDICAL TREATMENT services rendered under a theory of quantum meruit. The defendants,
Harris and his attorney Ryland, argue that a quantum meruit recovery is
Much of the foregoing authority and discussion is pertinent to the issue not appropriate where the underlying contract is void as against public
of a contingency fee for medical treatment as well. In particular, the policy.4
American Medical Association Code of Ethics, 6.01, emphasizing the
ever present danger that the physician may become less of a healer and A quantum meruit action is an equitable substitute for a contract claim
more of an advocate or partisan, states that a physician's fee for medical pursuant to which a party may recover the reasonable value of goods and
services should be based on the value of the service provided by the services provided to another if the following circumstances are shown:
physician to the patient and not on the uncertain outcome of a contingency
that does not in any way relate to the value of the medical service. 1. There is no existing, enforceable contract between the parties
covering the same subject matter;
The prohibition in the American Medical Association Code of Ethics, which
has been adopted by the Tennessee Board of Medical Examiners, is a clear 2. The party seeking recovery proves that it provided valuable goods or
reflection of public policy. As the New Jersey Supreme Court said in Polo v. services;
Gotchel, supra,
3. The party to be charged received the goods or services;
Section 8.04 This section clearly enunciates the public policy that
doctor's fees should not be based on an uncertain outcome of a 4. The circumstances indicate that the parties to the transaction should
contingency, the underlying public policy being the danger of the physician have reasonably understood that the person providing the goods or
becoming more of an advocate and less of a healer. A doctor's fee should services expected to be compensated; and
be calculated only on the value of the medical services provided, in
accordance with accepted standards of fee payment for services rendered. 5. The circumstances demonstrate that it would be unjust for a party to
retain the goods or services without payment.
542 A.2d at 948 (emphasis added).
Castelli v. Lien, 910 S.W.2d 420, 427 (Tenn.Ct.App.1995); see Paschall's,
The same public policy is contained in the Interprofessional Code of Inc. v. Dozier, 219 Tenn. 45, 54, 407 S.W.2d 150, 154 (1966).
Cooperation adopted by the Tennessee Medical Association and the
Tennessee Bar Association, which states that under no circumstances may With regard to the first factor, we observe that the parties dispute the
a physician receive a contingency fee for any service. Article VI, 2. scope of the contingency fee contract. Harris and Attorney Ryland
Simply put, contingency fees for medical services not only imperil the contend it was solely for medico-legal expert services and that a separate,
sanctity of the doctor/patient relationship but also create the potential that non-contingency fee agreement existed for the medical treatment. Dr.
pecuniary interests may influence professional judgment. Swafford, on the other hand, contends that the contingency fee contract
included expert services and medical treatment and that, if void, he is
In this case the contracts indicate that the parties contemplated the legal entitled to quantum meruit recovery for both.
action and also Dr. Swafford's role in the proceedings. With the financial
incentives already in place, it is immaterial whether the contingency fee We need not dwell on this factual dispute because our decision with
contract was for medico-legal expert services and/or for medical respect to recovery under quantum meruit rests principally upon the fifth
treatment. Under the authority discussed above, a contingency fee for factor. Although we have not addressed this issue before under these
either is against sound public policy and therefore void and unenforceable. circumstances, we have held on at least one prior occasion that quantum
meruit was not available where the underlying contract was found void as
QUANTUM MERUIT against public policy. For example, in White v. McBride, 937 S.W.2d 796
(Tenn.1996), a contract provided that an attorney would receive a
We turn to the third and final question certified for our review. Dr. contingency fee plus a $2,500 retainer. The trial court found that the
Swafford contends that if contingency fee contracts for the services of a contingency fee was clearly excessive in relation to the work performed by
physician are unenforceable, he is entitled to receive payment for the the attorney in violation of Code of Professional Responsibility, Disciplinary


Rule 2-106, but awarded the attorney $12,500 based on quantum meruit. and/or medical treatment that is contingent on the outcome of litigation is
We held that although attorneys should not be unfairly penalized for against public policy and unenforceable. We also conclude that a
innocent errors in drafting that might render a contract unenforceable, the quantum meruit recovery is not appropriate under the facts of this case.
violation of Disciplinary Rule 2-106 was an ethical transgression of the
most flagrant sort as it goes to the heart of the fiduciary relationship that Costs of this appeal are taxed to the plaintiff, Dr. Greg Swafford, for which
exists between attorney and client. Id. at 803. We therefore reversed execution may issue if necessary.
the trial court's award of quantum meruit.
The Michigan Court of Appeals reached a similar conclusion with respect to
a contingency fee contract for physician services in Dupree, supra. After 1. The Supreme Court may, at its discretion, answer questions of law
holding that the contingency fee contract was void as against public policy, certified to it by the Supreme Court of the United States, a Court of
the court said: Appeals of the United States, a District Court of the United States in
Tennessee, or a United States Bankruptcy Court in Tennessee. This rule
While it is not necessarily the case that quantum meruit is an inappropriate may be invoked when the certifying court determines that, in a proceeding
consideration where the underlying contract is void as against public before it, there are questions of law of this state which will be
policy, where a contract violates strong, established public policies determinative of the cause and as to which it appears to the certifying
quantum meruit will not be given in aid of or to encourage unprofessional court there is no controlling precedent in the decisions of the Supreme
conduct infringing the integrity of judicial proceedings. In this case, we Court of Tennessee. Tenn. Sup.Ct. R. 23, 1.
find contingent fee contracts of the type at issue so repugnant to
established public policy, as expressed by statutes, court rules, and court 2. Relying on these provisions, the Tennessee Medical Association,
opinions, that to permit recovery on a quantum meruit basis would defeat proceeding as amicus curiae, asserts that the contingency fee contracts
or subvert those policies and threaten the integrity of the judicial system. used for medical services or medical-legal consulting are void as against
public policy. It further asserts that the harm in such contracts is that the
445 N.W.2d at 500 (emphasis added; citations omitted). inherent pecuniary interest diverts the physician's attention from the
paramount interest of providing quality health care.
In our view, White and Dupree are applicable in this case. The
contingency fee contract for physician services is expressly prohibited by 3. We note that a few commentators, while acknowledging the
both the American Medical Association Code of Ethics and the Tennessee legitimate public policy goals of the majority rule against contingency fee
Code of Professional Responsibility. For the reasons previously discussed, contracts for experts, have proposed alternative arrangements based on
the violation not only subverts the doctor/patient relationship but also the competing policy of providing expert services for litigants who may not
converts Dr. Swafford into a partisan with an economic interest in the otherwise be able to afford expert services. See J. Parker, Contingent
outcome. Swafford's principal defense on appeal is that he was either Expert Witness Fees: Access and Legitimacy, 64 S. Cal. L.Rev. 1363 (1991)
unaware of the ethical provisions or did not belong to the organizations (proposing contingency fee based on hours worked rather than amount of
that promulgate the provisions-an explanation tantamount to suggesting plaintiff's recovery); Note, Contingent Fees for Expert Witnesses in Civil
he is subject to no public policy or regulatory authority whatsoever. We Litigation, 86 Yale L.J. 1680 (1977)(proposing extensive court supervision of
conclude that allowing quantum meruit under these circumstances would contingency fee contract).
undermine and subvert strong public policies established to prohibit
unprofessional conduct which affects the integrity of the judicial process 4. The Tennessee Medical Association, proceeding as amicus curiae,
and the administration of justice. agrees that a recovery under quantum meruit is not appropriate under the
facts of this case.
ANDERSON, Chief Justice. BIRCH, DROWOTA, REID and HOLDER, JJ., concur.
Based on the foregoing authority and discussion we conclude that a
contract requiring a party to pay a fee for medico/legal expert services