A.C. No. 5303 June 15, 2006 A.
, 2006 A. Jalandoni, Chairman/President of PRC was sued before RTC, Branch 52 in Civil Case No.
HUMBERTO C. LIM, JR., in behalf of PENTA RESORTS CORPORATION/Attorney-
in-Fact of LUMOT A. JALANDONI, Complainant,
vs.
ATTY. NICANOR V. VILLAROSA, Respondent.
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. Administrative Case No. 5463: Sandra F. Vaflor v. Atty. Adoniram P. Pamplona
and Atty. Nicanor V. Villarosa;
2. 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
(b) 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
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 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
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 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 respondent’s 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 letter expressly 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 PRC’s 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 corporation’s 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 [lawyer’s] 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 xxx
-I-
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 respondent’s 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
for [the] entire proceedings of the case?
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 Lim’s 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 withdraw13 since Mrs. Gargoles is Mrs. Jalandoni’s 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 [family’s].
From the facts obtaining, it is evident that complainant had a lawyer-client relationship with
the respondent before the latter [was] retained as counsel by the Spouses Jalbuena when the
latter were sued by complainant’s 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
respondent’s 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
Investigator’s 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 Lim’s 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. whether there existed a conflict of interest in the cases represented and handled by
respondent, and
 2. 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 PRC’s 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 AAQSC’s 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 respondent’s alleged effort to settle the existing controversy among the family
members37 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 respondent’s 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."43Respondent 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
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. Alminaza’s professional engagement on her behalf
despite respondent’s 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 client’s
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 Lim’s apparent use of his wife’s 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.
SO ORDERED.

The appearance of Atty. Alminaza in fact was not even to substitute for respondent but to act
as additional counsel.45 Mrs. Jalandoni’s conformity to having an additional lawyer did not
necessarily mean conformity to respondent’s desire to withdraw as counsel. Respondent’s
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. Jalandoni’s 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:
Adm. Case No. 6708 August 25, 2005
(CBD Case No. 01-874)
FELICITAS S. QUIAMBAO, Complainant,
vs.
ATTY. NESTOR A. BAMBA, Respondent.
RESOLUTION
DAVIDE, JR., C.J.:
We are aware of the hapless fact that there are not enough lawyers to serve an exploding
population. This unfortunate state of affairs, however, will not seize this Court from exercising
its disciplinary power over lawyers culpable of serious indiscretions. The incidence of public
force must be deployed to bear upon the community to eventually forge a legal profession that
provides quality, ethical, accessible, and cost-effective legal service to our people and whose
members are willing and able to answer the call to public service.
In this administrative case for disbarment, complainant Felicitas S. Quiambao charges
respondent Atty. Nestor A. Bamba with violation of the Code of Professional Responsibility
for representing conflicting interests when the latter filed a case against her while he was at
that time representing her in another case, and for committing other acts of disloyalty and
double-dealing.
From June 2000 to January 2001, the complainant was the president and managing director of
Allied Investigation Bureau, Inc. (AIB), a family-owned corporation engaged in providing
security and investigation services. She avers that she procured the legal services of the
respondent not only for the corporate affairs of AIB but also for her personal case.
Particularly, the respondent acted as her counsel of record in an ejectment case against
Spouses Santiago and Florita Torroba filed by her on 29 December 2000 before the
Metropolitan Trial Court (MeTC) of Parañaque City, which was docketed as Civil Case No.
11928. She paid attorney’s fees for respondent’s legal services in that case. 1 About six months
after she resigned as AIB president, or on 14 June 2001, the respondent filed on behalf of AIB
a complaint for replevin and damages against her before the MeTC of Quezon City for the
purpose of recovering from her the car of AIB assigned to her as a service vehicle. This he did
without withdrawing as counsel of record in the ejectment case, which was then still pending. 2
Apart from the foregoing litigation matter, the complainant, in her Position Paper, charges the
respondent with acts of disloyalty and double-dealing. She avers that the respondent proposed
to her that she organize her own security agency and that he would assist her in its
organization, causing her to resign as president of AIB. The respondent indeed assisted her in
December 2000 in the formation of another security agency, Quiambao Risk Management
Specialists, Inc., (QRMSI), which was later registered under complainant’s name, with the
respondent as a "silent partner" represented by his associate Atty. Gerardo P. Hernandez. The
respondent was paid attorney’s fees for his legal services in organizing and incorporating
QRMSI. He also planned to "steal" or "pirate" some of the more important clients of AIB.
While serving as legal counsel for AIB and a "silent partner" of QRMSI, he convinced
complainant’s brother Leodegario Quiambao to organize another security agency, San Esteban
Security Services, Inc. (SESSI) where he (the respondent) served as its incorporator, director,
and president. The respondent and Leodegario then illegally diverted the funds of AIB to fund
the incorporation of SESSI, and likewise planned to eventually close down the operations of
AIB and transfer the business to SESSI.3
For his part, the respondent admits that he represented the complainant in the aforementioned
ejectment case and later represented AIB in the replevin case against her. He, however, denies
that he was the "personal lawyer" of the complainant, and avers that he was made to believe
that it was part of his function as counsel for AIB to handle even the "personal cases" of its
officers. Even assuming that the complainant confided to him privileged information about her
legal interests, the ejectment case and the replevin case are unrelated cases involving different
issues and parties and, therefore, the privileged information which might have been gathered
from one case would have no use in the other. At any rate, it was the complainant herself who
insisted that he stay as her counsel despite the perceived differences among her, her brother,
and AIB over the motor vehicle subject of the replevin case. The complainant even asked him
to assist her in her monetary claims against AIB.4
The respondent also denies the charge raised by the complainant in her position paper that he
agreed to be a "silent partner" of QRMSI through his nominee, Atty. Gerardo P. Hernandez,
who was his former law partner. He declined complainant’s offer to assume that role and
suggested Atty. Hernandez in his place; thus, 375 shares of stock were registered in Atty.
Hernandez’s name as consideration of his (Atty. Hernandez’s) legal services as corporate
secretary and legal counsel of QRMSI. The respondent also denies that he convinced
complainant’s brother Leodegario to organize another security agency and that the funds of
AIB were unlawfully diverted to SESSI. It was to complement the business of AIB, which was
then in danger of collapse, that SESSI was established. Leodegario’s wife and her son have the
effective control over SESSI. Respondent’s subscribed shareholdings in SESSI comprise only
800 shares out of 12,500 subscribed shares. He serves AIB and SESSI in different capacities:
as legal counsel of the former and as president of the latter.5
In his Report and Recommendation6 dated 31 August 2004, the investigating commissioner of
the IBP found the respondent guilty of representing conflicting interests based on the
following undisputed facts: first, the respondent was still complainant’s counsel of record in
the ejectment case when he filed, as legal counsel of AIB, the replevin case against her; and
second, the respondent was still the legal counsel of AIB when he advised the complainant on
the incorporation of another security agency, QRMSI, and recommended his former law
partner, Atty. Gerardo Hernandez, to be its corporate secretary and legal counsel and also
when he conferred with Leodegario to organize another security agency, SESSI, where the
respondent became an incorporator, stockholder, and president. Thus, the investigating
commissioner recommended that the respondent be suspended from the practice of law for one
year.
The IBP Board of Governors adopted and approved the investigating commissioner’s report
and recommendation, but reduced the penalty from one year to a stern reprimand. 7
The issue in this case is whether the respondent is guilty of misconduct for representing
conflicting interests in contravention of the basic tenets of the legal profession.
Rule 15.03, Canon 5 of the Code of Professional Responsibility provides: "A lawyer shall not
represent conflicting interests except by written consent of all concerned given after a full
disclosure of the facts." This prohibition is founded on principles of public policy and good
taste.8 In the course of a lawyer-client relationship, the lawyer learns all the facts connected
with the client’s case, including the weak and strong points of the case. The nature of that
relationship is, therefore, one of trust and confidence of the highest degree. 9 It behooves
lawyers not only to keep inviolate the client’s 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. 10
In broad terms, lawyers are deemed to represent conflicting interests when, in behalf of one
client, it is their duty to contend for that which duty to another client requires them to
oppose.11 Developments in jurisprudence have particularized various tests to determine
whether a lawyer’s conduct lies within this proscription. One test is whether a lawyer is duty-
bound to fight for an issue or claim in behalf of one client and, at the same time, to oppose that
claim for the other client.12 Thus, if a lawyer’s argument for one client has to be opposed by
that same lawyer in arguing for the other client, there is a violation of the rule.
Another test of inconsistency of interests is whether the acceptance of a new relation would
prevent the full discharge of the lawyer’s duty of undivided fidelity and loyalty to the client or
invite suspicion of unfaithfulness or double-dealing in the performance of that duty.13 Still
another test is whether the lawyer would be called upon in the new relation to use against a
former client any confidential information acquired through their connection or previous
employment.14
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 lawyer’s respective
retainers with each of them would affect the performance of the duty of undivided fidelity to
both clients.15
In this case, it is undisputed that at the time the respondent filed the replevin case on behalf of
AIB he was still the counsel of record of the complainant in the pending ejectment case. We
do not sustain respondent’s theory that since the ejectment case and the replevin case are
unrelated cases fraught with different issues, parties, and subject matters, the prohibition is
inapplicable. His representation of opposing clients in both cases, though unrelated, obviously
constitutes conflict of interest or, at the least, invites suspicion of double-dealing. While the
respondent may assert that the complainant expressly consented to his continued
representation in the ejectment case, the respondent failed to show that he fully disclosed the
facts to both his clients and he failed to present any written consent of the complainant and
AIB as required under Rule 15.03, Canon 15 of the Code of Professional Responsibility.
Neither can we accept respondent’s plea that he was duty-bound to handle all the cases
referred to him by AIB, including the personal cases of its officers which had no connection to
its corporate affairs. That the representation of conflicting interest is in good faith and with
honest intention on the part of the lawyer does not make the prohibition
inoperative.16 Moreover, lawyers are not obliged to act either as an adviser or advocate for
every person who may wish to become their client. They have the right to decline such
employment, subject, however, to Canon 14 of the Code of Professional
Responsibility.17 Although there are instances where lawyers cannot decline
representation,18 they cannot be made to labor under conflict of interest between a present
client and a prospective one.19
Additionally, in his position paper, the respondent alleges that when the complainant invited
the respondent to join QRMSI, he "vehemently refused to join them due to his perception
of conflicting interest as he was then (and still is at present) the Legal Counsel" of AIB,
which is also a security agency.20 To bolster his allegation, he invoked the affidavits of
complainant’s witnesses which contained statements of his apprehension of conflict of interest
should he join QRMSI.21
Surprisingly, despite his apprehension or awareness of a possible conflict of interest should he
join QRMSI, the respondent later allowed himself to become an incorporator, stockholder, and
president of SESSI, which is also a security agency. He justified his act by claiming that that
while both AIB and SESSI are engaged in security agency business, he is serving in different
capacities. As the in-house legal counsel of AIB, he "serves its legal interest the parameter of
which evolves around legal matters" such as protecting the legal rights and interest of the
corporation; conducting an investigation or a hearing on violations of company rules and
regulations of their office employees and security guards; sending demand letters in collection
cases; and representing the corporation in any litigation for or against it. And as president of
SESSI, he serves the operational aspects of the business such as "how does it operate[], how
much do they price their services, what kind or how do they train[] their security guards, how
they solicit clients." Thus, conflict of interest is far-fetched. Moreover, the respondent argues
that the complainant, not being a stockholder of AIB and SESSI, has no right to question his
alleged conflict of interest in serving the two security agencies.22
While the complainant lacks personality to question the alleged conflict of interests on the part
of the respondent in serving both security agencies, we cannot just turn a blind eye to
respondent’s act. It must be noted that the proscription against representation of conflicting
interests finds application where the conflicting interests arise with respect to the same general
matter however slight the adverse interest may be. It applies even if the conflict pertains to the
lawyer’s private activity or in the performance of a function in a non-professional
capacity.23 In the process of determining whether there is a conflict of interest, an important
criterion is probability, not certainty, of conflict.
Since the respondent has financial or pecuniary interest in SESSI, which is engaged in a
business competing with his client’s, and, more importantly, he occupies the highest position
in SESSI, one cannot help entertaining a doubt on his loyalty to his client AIB. This kind of
situation passes the second test of conflict of interest, which is whether the acceptance of a
new relationship would prevent the full discharge of the lawyer’s duty of undivided fidelity
and loyalty to the client or invite suspicion of unfaithfulness or double-dealing in the
performance of that duty. The close relationship of the majority stockholders of both
companies does not negate the conflict of interest. Neither does his protestation that his
shareholding in SESSI is "a mere pebble among the sands."
In view of all of the foregoing, we find the respondent guilty of serious misconduct for
representing conflicting interests.
Furthermore, it must be noted that Republic Act No. 5487, otherwise known as the Private receipt of this Resolution, with a warning that a similar infraction in the future shall be dealt
Security Agency Law, prohibits a person from organizing or having an interest in more than with more severely.
one security agency. From respondent’s position paper, it can be culled that Leodegario
Quiambao is the president and managing director of AIB, holding 60% of the outstanding Let copies of this Resolution be furnished to the Office of the Bar Confidant and the Integrated
shares; while his four other siblings who are permanent residents in the United States own the Bar of the Philippines.
remaining 40%.24 This prohibition notwithstanding, the respondent organized SESSI, with
Leodegario’s wife and son as majority stockholders holding about 70% of the outstanding
shares and with him (the respondent), as well as the rest of the stockholders, holding minimal SO ORDERED.
shares.25 In doing so, the respondent virtually allowed Leodegario and the latter’s wife to
violate or circumvent the law by having an interest in more than one security agency. It must
be noted that in the affidavit26 of Leodegario’s wife, she mentioned of their conjugal property.
In the absence of evidence to the contrary, the property relation of Leodegario and his wife can
be presumed to be that of conjugal partnership of gains; hence, the majority shares in AIB and
SESSI are the conjugal property of Leodegario and his wife, thereby placing themselves in
possession of an interest in more than one security agency in contravention of R.A. No. 5487.
Thus, in organizing SESSI, the respondent violated Rule 1.02, Canon 1 of the Code of
Professional Responsibility, which mandates lawyers to promote respect for the law and
refrain from counseling or abetting activities aimed at defiance of the law.

As to the recommendation that the penalty be reduced from a suspension of one year to a stern
warning, we find the same to be without basis. We are disturbed by the reduction made by the
IBP Board of Governors of the penalty recommended by the investigating commissioner
without clearly and distinctly stating the facts and reasons on which that reduction is based.

Section 12(a), Rule 139-B of the Rules of Court reads in part as follows:

SEC. 12. Review and decision by the Board of Governors. –

(a) Every case heard by an investigator shall be reviewed by the IBP Board of Governors upon
the record and evidence transmitted to it by the Investigator with his report. The decision of
the Board upon such review shall be in writing and shall clearly and distinctly state the facts
and the reasons on which it is based.

We may consider the resolution of the IBP Board of Governors as a memorandum decision
adopting by reference the report of the investigating commissioner. However, we look with
disfavor the change in the recommended penalty without any explanation therefor. Again, we
remind the IBP Board of Governors of the importance of the requirement to announce in plain
terms its legal reasoning, since the requirement that its decision in disciplinary proceedings
must state the facts and the reasons on which its decision is based is akin to what is required of
the decisions of courts of record.27 The reasons for handing down a penalty occupy no lesser
station than any other portion of the ratio.

In similar cases where the respondent was found guilty of representing conflicting interests a
penalty ranging from one to three years’ suspension was imposed. 28 In this case, we find that a
suspension from the practice of law for one year is warranted.

WHEREFORE, respondent Atty. Nestor A. Bamba is hereby held GUILTY of violation of

Rule 15.03 of Canon 15 and Rule 1.02 of Canon 1 of the Code of Professional Responsibility.
He is SUSPENDED from the practice of law for a period of ONE (1) YEAR effective from
A.C. No. 6836 January 23, 2006
LETICIA GONZALES, Complainant,
vs.
ATTY. MARCELINO CABUCANA, Respondent.
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 attorney’s 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
respondent’s 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 respondent’s acceptance of the cases of the Gatchecos
violates the lawyer-client relationship between complainant and respondent’s 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 21.015 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 respondent’s 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 respondent’s 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 appeared16 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 di-pagkakaintindihan 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 mag-
asawang Gatcheco, gayong nalalaman ko na si Atty. 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 mag-asawang 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 kaya’t 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 submitted his Report and Recommendation,
portions of which are quoted hereunder:
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 and…advised 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.25Lawyers are expected not only
to keep inviolate the client’s 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 lawyer’s 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 lawyer’s 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 respondent’s 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
Gatcheco spouses only with his name,39without 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
respondent’s 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.
SO ORDERED.

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 Court’s 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
A.C. No. 5804 July 1, 2003
BENEDICTO HORNILLA and ATTY. FEDERICO D. RICAFORT, complainants,
vs.
ATTY. ERNESTO S. SALUNAT, respondent.
RESOLUTION
YNARES-SANTIAGO, J.:
On November 21, 1997, Benedicto Hornilla and Federico D. Ricafort filed an administrative
complaint1 with the Integrated Bar of the Philippines (IBP) Commission on Bar Discipline,
against respondent Atty. Ernesto S. Salunat for illegal and unethical practice and conflict of
interest. They alleged that respondent is a member of the ASSA Law and Associates, which
was the retained counsel of the Philippine Public School Teachers Association (PPSTA).
Respondent’s brother, Aurelio S. Salunat, was a member of the PPSTA Board which approved
respondent’s engagement as retained counsel of PPSTA.
Complainants, who are members of the PPSTA, filed an intra-corporate case against its
members of the Board of Directors for the terms 1992-1995 and 1995-1997 before the
Securities and Exchange Commission, which was docketed as SEC Case No. 05-97-5657, and
a complaint before the Office of the Ombudsman, docketed as OMB Case No. 0-97-0695, for
unlawful spending and the undervalued sale of real property of the PPSTA. Respondent
entered his appearance as counsel for the PPSTA Board members in the said cases.
Complainants contend that respondent was guilty of conflict of interest because he was
engaged by the PPSTA, of which complainants were members, and was being paid out of its
corporate funds where complainants have contributed. Despite being told by PPSTA members
of the said conflict of interest, respondent refused to withdraw his appearance in the said cases.
Moreover, complainants aver that respondent violated Rule 15.06 2 of the Code of Professional
Responsibility when he appeared at the meeting of the PPSTA Board and assured its members
that he will win the PPSTA cases.
In his Answer,3 respondent stressed that he entered his appearance as counsel for the PPSTA
Board Members for and in behalf of the ASSA Law and Associates. As a partner in the said
law firm, he only filed a "Manifestation of Extreme Urgency" in OMB Case No. 0-97-
0695.4 On the other hand, SEC Case No. 05-97-5657 was handled by another partner of the
firm, Atty. Agustin V. Agustin. Respondent claims that it was complainant Atty. Ricafort who
instigated, orchestrated and indiscriminately filed the said cases against members of the
PPSTA and its Board.
Respondent pointed out that his relationship to Aurelio S. Salunat was immaterial; and that
when he entered into the retainer contract with the PPSTA Board, he did so, not in his
individual capacity, but in representation of the ASSA Law Firm. He denied that he ensured
the victory of the PPSTA Board in the case he was handling. He merely assured the Board that
the truth will come out and that the case before the Ombudsman will be dismissed for lack of
jurisdiction, considering that respondents therein are not public officials, but private
employees. Anent the SEC case, respondent alleged that the same was being handled by the
law firm of Atty. Eduardo de Mesa, and not ASSA.
By way of Special and Affirmative Defenses, respondent averred that complainant Atty.
Ricafort was himself guilty of gross violation of his oath of office amounting to gross
misconduct, malpractice and unethical conduct for filing trumped-up charges against him and
Atty. De Mesa. Thus, he prayed that the complaint against him be dismissed and, instead,
complainant Ricafort be disciplined or disbarred.
The complainant was docketed as CBD Case No. 97-531 and referred to the IBP Commission
on Bar Discipline. After investigation, Commissioner Lydia A. Navarro recommended that
respondent be suspended from the practice of law for six (6) months. The Board of Governors
thereafter adopted Resolution No. XV-3003-230 dated June 29, 2002, approving the report and
recommendation of the Investigating Commissioner.
Respondent filed with this Court a Motion for Reconsideration of the above Resolution of the
IBP Board of Governors.
The pertinent rule of the Code of Professional Responsibility 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.
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 lawyer’s 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."5 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. 6 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.7 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.8
In this jurisdiction, a corporation’s board of directors is understood to be that body which (1)
exercises all powers provided for under the Corporation Code; (2) conducts all business of the
corporation; and (3) controls and holds all property of the corporation. 9 Its members have been
characterized as trustees or directors clothed with a fiduciary character.10 It is clearly separate
and distinct from the corporate entity itself.
Where corporate directors have committed a breach of trust either by their frauds, ultra vires
acts, or negligence, and the corporation is unable or unwilling to institute suit to remedy the
wrong, a stockholder may sue on behalf of himself and other stockholders and for the benefit
of the corporation, to bring about a redress of the wrong done directly to the corporation and
indirectly to the stockholders.11 This is what is known as a derivative suit, and settled is the
doctrine that in a derivative suit, the corporation is the real party in interest while the
stockholder filing suit for the corporation’s behalf is only nominal party. The corporation
should be included as a party in the suit.12
Having thus laid a suitable foundation of the basic legal principles pertaining to derivative SO ORDERED.
suits, we come now to the threshold question: can a lawyer engaged by a corporation defend
members of the board of the same corporation in a derivative suit? On this issue, the following
disquisition is enlightening:

The possibility for conflict of interest here is universally recognized. Although early cases
found joint representation permissible where no conflict of interest was obvious, the emerging
rule is against dual representation in all derivative actions. Outside counsel must thus be
retained to represent one of the defendants. The cases and ethics opinions differ on whether
there must be separate representation from the outset or merely from the time the corporation
seeks to take an active role. Furthermore, this restriction on dual representation should not be
waivable by consent in the usual way; the corporation should be presumptively incapable of
giving valid consent.13(underscoring ours)

In other jurisdictions, the prevailing rule is that a situation wherein a lawyer represents both
the corporation and its assailed directors unavoidably gives rise to a conflict of interest. The
interest of the corporate client is paramount and should not be influenced by any interest of the
individual corporate officials.14 The rulings in these cases have persuasive effect upon us.
After due deliberation on the wisdom of this doctrine, we are sufficiently convinced that a
lawyer engaged as counsel for a corporation cannot represent members of the same
corporation’s board of directors in a derivative suit brought against them. To do so would be
tantamount to representing conflicting interests, which is prohibited by the Code of
Professional Responsibility.

In the case at bar, the records show that SEC Case No. 05-97-5657, entitled "Philippine Public
School Teacher’s Assn., Inc., et al. v. 1992-1995 Board of Directors of the Philippine Public
School Teacher’s Assn. (PPSTA), et al.," was filed by the PPSTA against its own Board of
Directors. Respondent admits that the ASSA Law Firm, of which he is the Managing Partner,
was the retained counsel of PPSTA. Yet, he appeared as counsel of record for the respondent
Board of Directors in the said case. Clearly, respondent was guilty of conflict of interest when
he represented the parties against whom his other client, the PPSTA, filed suit.

In his Answer, respondent argues that he only represented the Board of Directors in OMB
Case No. 0-97-0695. In the said case, he filed a Manifestation of Extreme Urgency wherein he
prayed for the dismissal of the complaint against his clients, the individual Board Members.
By filing the said pleading, he necessarily entered his appearance therein. 15 Again, this
constituted conflict of interests, considering that the complaint in the Ombudsman, albeit in
the name of the individual members of the PPSTA, was brought in behalf of and to protect the
interest of the corporation.

Therefore, respondent is guilty of representing conflicting interests. Considering however, that

this is his first offense, we find the penalty of suspension, recommended in IBP Resolution
No. XV-2002-230 dated June 29, 2002, to be too harsh. Instead, we resolve to admonish
respondent to observe a higher degree of fidelity in the practice of his profession.

ACCORDINGLY, respondent Atty. Ernesto Salunat is found GUILTY of representing

conflicting interests and is ADMONISHED to observe a higher degree of fidelity in the
practice of his profession. He is further WARNED that a repetition of the same or similar acts
will be dealt with more severely.
ADM. CASE NO. 6876 March 7, 2008
HEIRS OF LYDIO "JERRY" FALAME, namely: MELBA FALAME, LEO FALAME
and JERRY FALAME,petitioners, vs.ATTY. EDGAR J. BAGUIO, respondent.
On Petition for Review1 is the Resolution of the Integrated Bar of the Philippines (IBP) Board
of Governors dismissing the disbarment complaint filed by the Heirs of Lydio "Jerry" Falame
(complainants) against Atty. Edgar J. Baguio (respondent), docketed as CBD Case No. 04-
1191.
In their Complaint2 against respondent, complainants alleged that on 15 July 1991, their father,
the late Lydio "Jerry" Falame (Lydio), engaged the services of respondent to represent him in
an action for forcible entry docketed as Civil Case No. A-2694 (the first civil case) and
entitled "Heirs of Emilio T. Sy, represented by Anastacia Velayo Vda. De Sy and Belen V. Sy
vs. Lydio 'Jerry' Falame, Raleigh Falame and Four (4) John Does," in which Lydio was one
of the defendants.3
Complainants recounted that respondent, as counsel for the defendants, filed the answer to the
complaint in the first civil case. Subsequently, when the parties to the first civil case were
required to file their respective position papers, respondent used and submitted in evidence the
following: (1) a special power of attorney dated 1 July 1988 executed by Lydio in favor of his
brother, Raleigh Falame, appointing the latter to be his attorney-in-fact; and (2) the affidavit of
Raleigh Falame dated 23 July 1988, executed before respondent, in which Raleigh stated that
Lydio owned the property subject of the first civil case.4
Complainants claimed that even after the Municipal Trial Court of Dipolog City had ruled in
favor of the defendants in the first civil case, Lydio retained the services of respondent as his
legal adviser and counsel for his businesses until Lydio's death on 8 September 1996. 5
However, on 23 October 2000, in representation of spouses Raleigh and Noemi Falame,
respondent filed a case against complainants allegedly involving the property subject of the
first civil case, entitled "Spouses Rally F. Falame and Noemi F. Falame v. Melba A. Falame,
Leo A. Falame, Jerry A. Falame, Jr., Sugni Realty Holdings and Development Corporations,
their representatives, agents and persons acting in their behalf" and docketed as Civil Case
No. 5568 (the second civil case) before the Regional Trial Court of Dipolog City, Branch 6.
The complaint sought the declaration of nullity of the deed of sale, its registration in the
registry of deeds, Transfer Certificate of Title No. 20241 issued as a consequence of the
registration of the deed of sale, and the real estate mortgage on the said property.
Alternatively, it prayed for specific performance and reconveyance or legal redemption and
damages with preliminary injunction and restraining order.6
Firstly, complainants maintained that by acting as counsel for the spouses Falame in the
second civil case wherein they were impleaded as defendants, respondent violated his oath of
office and duty as an attorney. Plainly, they contended that the spouses Falame's interests are
adverse to those of his former client, Lydio.7
Secondly, complainants claimed that respondent knowingly made false statements of fact in
the complaint in the second civil case to mislead the trial court. In so doing, respondent
violated paragraph (d), Section 208 of Rule 138 of the Rules of Court,9 complainants asserted
further.
Lastly, complainants alleged that the second civil case is a baseless and fabricated suit which
respondent filed as counsel for complainants' uncle against the heirs of respondent's deceased
client. Specifically, they averred that respondent filed the case for the sole purpose of
retaining, maintaining and/or withholding the possession of the subject property from
complainants who are its true owners. Complainants concluded that respondent violated
paragraph (g), Section 2010 of Rule 138 of the Rules of Court.11
In his Answer with Motion to Dismiss,12 respondent controverted complainants' allegations.
He emphasizes that it was only Raleigh Falame who personally engaged his legal services for
him and on Lydio's behalf and that, in fact, it was Raleigh who paid him the attorney's fees. He
also stated that he signed the jurat in Raleigh's affidavit, which was submitted as evidence in
the first civil case, believing to the best of his knowledge that there is good ground to support
it. Insisting that he did not betray the confidence reposed in him by Lydio as the latter's
counsel in the first civil case, respondent maintained that he did not reveal or use any fact he
acquired knowledge of during the existence of the attorney-client relation in the first civil case
as he had never even conferred with nor talked to Lydio in the first place. Respondent likewise
contended that he did not knowingly make any misleading or untruthful statement of fact in
the complaint in the second civil case and neither did he employ any means inconsistent with
truth and honor in the hearing of the case.13
Respondent vigorously averred that Lydio had not retained him as counsel in any case or
transaction. Stressing the long interval of twelve years separating the termination of the first
civil case and his acceptance of the second civil case, respondent pointed out that the first civil
case was not between Lydio and Raleigh but rather between the heirs of Emilio T. Sy on one
hand and Lydio and Raleigh on the other where physical possession of property was at stake.
Respondent further averred that in contrast the second civil case is one involving the spouses
Raleigh and Noemi Falame as plaintiffs, and Melba, Leo and Jerry Jr., all surnamed Falame,
and Sugni Realty Holdings and Development Corporation, as defendants—a case which arose
from the wrongful acts committed by Melba, Leo and Jerry Jr. after Lydio's death. 14
Respondent maintained that since the second civil case was still pending before the trial court,
the IBP had no jurisdiction over the instant administrative case. He added that complainants
filed this administrative case when Raleigh could no longer testify in his own favor as he had
died a year earlier.15
In their Position Paper16 dated 7 September 2004, in addition to their previous charges against
respondent, complainants claimed that respondent violated Rule 15.03 17 of the Code of
Professional Responsibility when he represented the cause of the spouses Falame against that
of his former client, Lydio.18
On 25 June 2005, the IBP Board of Governors passed Resolution No. XVI-2005-167 adopting
and approving Investigating Commissioner Winston D. Abuyuan's report and recommendation
for the dismissal of this administrative case, thus:19
x x x The charge lacks specification as to what part of the lawyer's oath was violated by the
respondent and what confidence was disclosed. The complainants may have in mind the
prohibition against disclosure of secret information learned in confidence, but there is no
specification in the complaint what secret or information learned in confidence under Civil
Case No. A-2694 was disclosed or will be disclosed by respondent in Civil Case No. 5568. In
administrative complaints for disbarment or suspension against lawyers, the complainant must
specify in the affidavit-complaint the alleged secrets or confidential information disclosed or
will be disclosed in the professional employment (Uy v. Gonzalez, 426 SCRA 422; 431). In
the absence of such specification, the complaint must fail.
In the complaint, there is no specific charge against respondent for violation of Canon 15, Rule
15.03 of the Code of Professional Responsibility about the prohibition against representation
of conflicting interest. So, the allegation in paragraph 1, page 8 and 9 of complainants' position
paper stating: With all due respect, it is submitted that respondent violated Canon 15, Rule
15.03 of the Code of Professional Responsibility" cannot be countenanced. The reason being
that it is an elementary principle of due process to which the respondent is entitled that only
those charged in the complaint can be proved by the complainants. A charge not specified in
the complaint cannot be proved (Uy v. Gonzales, id.)
x x x But still this charge will not proper for lack of sufficient bases.
xxx
Civil Case No. 5568, which was commenced on 03 October 2000, or three years since the
complainants became owners of Lydio Falame's properties, is a suit against the complainants,
not as representatives of Lydio Falame, but as owners of their respective aliquot interests in
the property in question (Gayon v. Gayon, 36 SCRA 104; 107-108). The complainants are
sued not on the basis of the acts, rights, obligations and interest of Lydio Falame on the
material possession of the improvements found on Lot 345 litigated in Civil Case No. A-2694
nor even on such land itself, but rather on the facts alleged in the second amended and
supplemental complaint which give rise to their cause of action against them.
While the complainants could not specify under what circumstances the respondent committed
[the] alleged breach of confidence, breach of secrecy or revelation of secret or confidential
information[,] the respondent has shown that he did not commit any violation of such duties or
obligations of an attorney.
It is clear that only Raleigh Falame engaged the legal services of the respondent for his and
Lydio Falame's defense in Civil Case No. A-2694.
xxx
The other allegations of the complainants that the respondent violated paragraph (d), Section
20 of Rule 139, Rules of Court, and his lawyer's oath when he allegedly betrayed the trust and
confidence of his former client by denying knowledge of the fact that the land was owned by
Lydio Falame and when he did not disclose to the Court that at one time his present clients
categorically declared and unconditionally recognized the full ownership of the late Lydio
Falame and complainant Melba Falame over subject matter of both cases equally lacks
evidentiary basis.
xxx
It is beyond the competence of the complainants to conclude and is outside the jurisdiction of
this Honorable Commission to rule as to whether or nor (sic) the complaint in Civil Case
No.5568 is baseless or fabricated. It is only the Honorable Court which has the exclusive
jurisdiction to determine the same and cannot be the subject of an administrative complaint
against the respondent.
xxx
WHEREFORE, premises considered, it is respectfully recommended that this complaint be
dismissed on grounds of prescription, the same having been filed four (4) years after the
alleged misconduct took place and for lack of merit.
RESPECTFULLY SUBMITTED.20
Dissatisfied, complainants filed the instant petition for review under Rule 45 of the Rules of
Court reiterating their allegations in the complaint and their position paper.21 They likewise
assert that the IBP erred in holding that the instant administrative complaint had been filed out
of time since it was filed on 16 January 2004, or three (3) years, four (4) months and sixteen
(16) days after the second civil case was filed on 23 October 2000. 22 In addition, in their
Consolidated Comment (should be Consolidated Reply),23 complainants invoke the Court's
ruling in Frias v. Bautista-Lozada24to support their contention that administrative complaints
against members of the bar do not prescribe.25
In his Comment,26 respondent principally maintains that the charges imputed to him have
never been proven by clear, convincing and satisfactory evidence which is the quantum of
proof required in administrative cases against lawyers, and that complainants have the burden
to prove their accusations as he enjoys the presumption of innocence. 27 Respondent likewise
asserts that in accusing him of violation of Rule 15.03 of the Code of Professional
Responsibility only in their position paper and in the instant petition, complainants infringed
his right to due process and to be informed of the nature and cause of accusation against him.28
There is merit in the petition.
At the outset, the Court holds that the instant administrative action is not barred by
prescription. As early as 1947, the Court held in Calo, Jr. v. Degamo,29 to wit:
The ordinary statutes of limitation have no application to disbarment proceedings,
nor does the circumstance that the facts set up as a ground for disbarment constitute
a crime, prosecution for which in a criminal proceeding is barred by limitation,
affect the disbarment proceeding x x x (5 Am. Jur. 434)30
This doctrine was reaffirmed in the relatively recent case of Frias v. Bautista-Lozada31where
the Court held that Rule VII, Section 1 of the Rules of Procedure of the CBD-IBP, which
provides for a prescriptive period for the filing of administrative complaints against lawyers,
should be struck down as void and of no legal effect for being ultra vires.32
Prescinding from the unavailability of the defense of prescription, the Court concurs with the
Investigating Commissioner's opinion that some of the charges raised by complainants in their
complaint are unsubstantiated.
There is, however, sufficient basis to hold respondent accountable for violation of Rule 15.03
of the Code of Professional Responsibility. While this charge was not raised in the initiatory
pleading, it was put forward in complainants' position paper filed with the IBP and in the
petition filed with the Court. In fact, respondent proffered his defenses to the charge in his
position paper before the IBP and likewise in his comment before the Court. In his very first
pleading before the IBP, the answer with motion to dismiss, he denied having Lydio as his
client. Such absence of attorney-client relationship is the essential element of his defense to
the charge of conflict of interest, as articulated in his subsequent submissions.
The Court, therefore, rules and so holds that respondent has been adequately apprised of and
heard on the issue. In administrative cases, the requirement of notice and hearing does not
connote full adversarial proceedings. Actual adversarial proceedings only become necessary
for clarification when there is a need to propound searching questions to witnesses who give
vague testimonies. Due process is fulfilled when the parties were given reasonable opportunity
to be heard and to submit evidence in support of their arguments. 33
Rule 15.03 of the Code of Professional Responsibility provides:
A lawyer shall not represent conflicting interests except by written consent of all
concerned given after a full disclosure of the facts.
A lawyer 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.34 The test is whether, on
behalf of one client, it is the lawyer's duty to contest for that which his duty to another client
requires him to oppose or when the possibility of such situation will develop. 35 The 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.36 In addition, the rule holds even if
the inconsistency is remote or merely probable or the lawyer has acted in good faith and with
no intention to represent conflicting interests.37
The rule concerning conflict of interest prohibits a lawyer from representing a client if that
representation will be directly adverse to any of his present or former clients. In the same way,
a lawyer may only be allowed to represent a client involving the same or a substantially
related matter that is materially adverse to the former client only if the former client consents
to it after consultation. The rule is grounded in the fiduciary obligation of loyalty. 38 In the
course of a lawyer-client relationship, the lawyer learns all the facts connected with the client's
case, including the weak and strong points of the case. The nature of that relationship is,
therefore, one of trust and confidence of the highest degree. 39
The termination of attorney-client relation provides no justification for a lawyer to represent
an interest adverse to or in conflict with that of the former client. The client's confidence once
reposed should not be divested by mere expiration of professional employment. Even after the
severance of the relation, a lawyer should not do anything which will injuriously affect his
former client in any matter in which he previously represented him nor should he disclose or
use any of the client's confidences acquired in the previous relation. 40
In relation to this, Canon 17 of the Code of Professional Responsibility provides that a lawyer
owes fidelity to the cause of his client and shall be mindful of the trust and confidence reposed
on him. His highest and most unquestioned duty is to protect the client at all hazards and costs
even to himself.41 The protection given to the client is perpetual and does not cease with the
termination of the litigation, nor is it affected by the party's ceasing to employ the attorney and
retaining another, or by any other change of relation between them. It even survives the death
of the client.42
In the case at bar, respondent admitted having jointly represented Lydio and Raleigh as
defendants in the first civil case. Evidently, the attorney-client relation between Lydio and
respondent was established despite the fact that it was only Raleigh who paid him. The case
of Hilado v. David43tells us that it is immaterial whether such employment was paid, promised
or charged for.44
As defense counsel in the first civil case, respondent advocated the stance that Lydio solely
owned the property subject of the case. In the second civil case involving the same property,
respondent, as counsel for Raleigh and his spouse, has pursued the inconsistent position that
Raleigh owned the same property in common with Lydio, with complainants, who inherited
the property, committing acts which debase respondent's rights as a co-owner.
The fact that the attorney-client relation had ceased by reason of Lydio's death or through the
completion of the specific task for which respondent was employed is not reason for
respondent to advocate a position opposed to that of Lydio.45 Precedents tell us that even after
the termination of his employment, an attorney may not 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.46 And while complainants have never been respondent's clients, they derive their
rights to the property from Lydio's ownership of it which respondent maintained in the first
civil case.
For representing Raleigh's cause which is adverse to that of his former client—Raleigh's
supposed co-ownership of the subject property— respondent is guilty of representing
conflicting interests. Having previously undertaken joint representation of Lydio and Raleigh,
respondent should have diligently studied and anticipated the
potential conflict of interest. Accordingly, disciplinary action is warranted. 47 Heretofore,
respondent is enjoined to look at any representation situation from "the point of view that there
are possible conflicts"; and further, "to think in terms of impaired loyalty" that is to evaluate if
his representation in any way will impair loyalty to a client. 48Considering, however, that this is
respondent's first offense, the Court resolves to reprimand respondent, with admonition to
observe a higher degree of fidelity in the practice of his profession. 49
WHEREFORE, respondent Atty. Edgar J. Baguio is found GUILTY of representing
conflicting interests and meted out the penalty of REPRIMAND. He is further admonished to
observe a higher degree of fidelity in the practice of his profession and to bear in mind that a
repetition of the same or similar acts will be dealt with more severely.
SO ORDERED.