A.C. No.

8243 July 24, 2009

ROLANDO B. PACANA, JR., Complainant,
vs.
ATTY. MARICEL PASCUAL-LOPEZ, Respondent.
DECISION
PER CURIAM:
This case stems from an administrative complaint 1 filed by Rolando Pacana, Jr. against Atty. Maricel Pascual-Lopez
charging the latter with flagrant violation of the provisions of the Code of Professional Responsibility. 2 Complainant
alleges that respondent committed acts constituting conflict of interest, dishonesty, influence peddling, and failure to
render an accounting of all the money and properties received by her from complainant.
On January 2, 2002, complainant was the Operations Director for Multitel Communications Corporation (MCC).
MCC is an affiliate company of Multitel International Holdings Corporation (Multitel). Sometime in July 2002, MCC
changed its name to Precedent Communications Corporation (Precedent). 3
According to complainant, in mid-2002, Multitel was besieged by demand letters from its members and investors
because of the failure of its investment schemes. He alleges that he earned the ire of Multitel investors after becoming
the assignee of majority of the shares of stock of Precedent and after being appointed as trustee of a fund amounting to
Thirty Million Pesos (₱30,000,000.00) deposited at Real Bank.
Distraught, complainant sought the advice of respondent who also happened to be a member of the Couples for Christ,
a religious organization where complainant and his wife were also active members. From then on, complainant and
respondent constantly communicated, with the former disclosing all his involvement and interests in Precedent and
Precedent’s relation with Multitel. Respondent gave legal advice to complainant and even helped him prepare standard
quitclaims for creditors. In sum, complainant avers that a lawyer-client relationship was established between him and
respondent although no formal document was executed by them at that time. A Retainer Agreement 4 dated January 15,
2003 was proposed by respondent. Complainant, however, did not sign the said agreement because respondent
verbally asked for One Hundred Thousand Pesos (₱100,000.00) as acceptance fee and a 15% contingency fee upon
collection of the overpayment made by Multitel to Benefon, 5 a telecommunications company based in Finland.
Complainant found the proposed fees to be prohibitive and not within his means. 6 Hence, the retainer agreement
remained unsigned.7
After a few weeks, complainant was surprised to receive a demand letter from respondent 8 asking for the return and
immediate settlement of the funds invested by respondent’s clients in Multitel. When complainant confronted
respondent about the demand letter, the latter explained that she had to send it so that her clients – defrauded investors
of Multitel – would know that she was doing something for them and assured complainant that there was nothing to
worry about.9
Both parties continued to communicate and exchange information regarding the persistent demands made by Multitel
investors against complainant. On these occasions, respondent impressed upon complainant that she can closely work
with officials of the Anti-Money Laundering Council (AMLC), the Department of Justice (DOJ), the National Bureau
of Investigation (NBI), the Bureau of Immigration and Deportations (BID), 10 and the Securities and Exchange
Commission (SEC)11 to resolve complainant’s problems. Respondent also convinced complainant that in order to be
absolved from any liability with respect to the investment scam, he must be able to show to the DOJ that he was
willing to divest any and all of his interests in Precedent including the funds assigned to him by Multitel. 12
Respondent also asked money from complainant allegedly for safekeeping to be used only for his case whenever
necessary. Complainant agreed and gave her an initial amount of ₱900,000.00 which was received by respondent
herself.13 Sometime thereafter, complainant again gave respondent ₱1,000,000.00. 14 Said amounts were all part of
Precedent’s collections and sales proceeds which complainant held as assignee of the company’s properties. 15
When complainant went to the United States (US), he received several messages from respondent sent through
electronic mail (e-mail) and short messaging system (SMS, or text messages) warning him not to return to the
Philippines because Rosario Baladjay, president of Multitel, was arrested and that complainant may later on be
implicated in Multitel’s failed investment system. Respondent even said that ten (10) arrest warrants and a hold
departure order had been issued against him. Complainant, thereafter, received several e-mail messages from
respondent updating him of the status of the case against Multitel and promised that she will settle the matter
discreetly with government officials she can closely work with in order to clear complainant’s name. 16 In two separate
e-mail messages,17 respondent again asked money from complainant, ₱200,000 of which was handed by
complainant’s wife while respondent was confined in Saint Luke’s Hospital after giving birth, 18 and another ₱700,000
allegedly to be given to the NBI.19
Through respondent’s persistent promises to settle all complainant’s legal problems, respondent was able to convince
complainant who was still in the US to execute a deed of assignment in favor of respondent allowing the latter to
retrieve 178 boxes containing cellular phones and accessories stored in complainant’s house and inside a
warehouse.20 He also signed a blank deed of sale authorizing respondent to sell his 2002 Isuzu Trooper. 21
Sometime in April 2003, wary that respondent may not be able to handle his legal problems, complainant was advised
by his family to hire another lawyer. When respondent knew about this, she wrote to complainant via e-mail, as
follows:
Dear Butchie,

Hi! Ok ka lang? Hope you are fine. Sorry if I shocked you but I had to do it as your friend and lawyer.
The charges are all non-bailable but all the same as the SEC report I told you before. The findings are the
same, i.e. your company was the front for the fraud of Multitel and that funds were provided you.

I anticipated this, that is why I really pushed for a quitclaim. Rolly is willing to return the Crosswind,
laptap (sic) and [P]alm [P]ilot. Manny Cancio really helped. Anthony na lang. Then, I will need the
accounting of all the funds you received from the sale of the phones, every employees and directors[’]
quitclaim (including yours), the funds transmitted to the clients through me, the funds you utilized, and
whatelse (sic) is still unremitted, every centavo must be accounted for as DOJ and NBI can have the
account opened.

I will also need the P30 M proof of deposit with Real [B]ank and the trust given [to] you. So we can
inform them [that] it was not touched by you.

I have been informed by Efie that your family is looking at hiring Coco Pimentel. I know him very well
as his sister Gwen is my best friend. I have no problem if you hire him but I will be hands off. I work
differently kasi. In this cases (sic), you cannot be highprofile (sic) because it is the clients who will be
sacrificed at the expense of the fame of the lawyer. I have to work quietly and discreetly. No funfare. Just
like what I did for your guys in the SEC. I have to work with people I am comfortable with. Efren Santos
will sign as your lawyer although I will do all the work. He can help with all his connections. Val’s
friend in the NBI is the one is (sic) charge of organized crime who is the entity (sic) who has your
warrant. My law partner was the state prosecutor for financial fraud. Basically we have it covered in all
aspects and all departments. I am just trying to liquidate the phones I have allotted for you s ana (sic) for
your trooper kasi whether we like it or not, we have to give this agencies (sic) to make our work easier
according to Val. The funds with Mickey are already accounted in the quit claims (sic) as attorneys (sic)
fees. I hope he will be able to send it so we have funds to work with.

As for your kids, legally they can stay here but recently, it is the children who (sic) the irate clients and
government officials harass and kidnap to make the individuals they want to come out from hiding (sic).
I do not want that to happen. Things will be really easier on my side.

Please do not worry. Give me 3 months to make it all disappear. But if you hire Coco, I will give him the
free hand to work with your case. Please trust me. I have never let you down, have I? I told you this will
happen but we are ready and prepared. The clients who received the phones will stand by you and make
you the hero in this scandal. I will stand by you always. This is my expertise. TRUST me! That is all.
You have an angel on your side. Always pray though to the best legal mind up there. You will be ok!

Candy22
On July 4, 2003, contrary to respondent’s advice, complainant returned to the country. On the eve of his departure
from the United States, respondent called up complainant and conveniently informed him that he has been cleared by
the NBI and the BID.23
About a month thereafter, respondent personally met with complainant and his wife and told them that she has already
accumulated ₱12,500,000.00 as attorney’s fees and was willing to give ₱2,000,000.00 to complainant in appreciation
for his help. Respondent allegedly told complainant that without his help, she would not have earned such amount.
Overwhelmed and relieved, complainant accepted respondent’s offer but respondent, later on, changed her mind and
told complainant that she would instead invest the ₱2,000,000.00 on his behalf in a business venture. Complainant
declined and explained to respondent that he and his family needed the money instead to cover their daily expenses as
he was no longer employed. Respondent allegedly agreed, but she failed to fulfill her promise. 24
Respondent even publicly announced in their religious organization that she was able to help settle the ten (10)
warrants of arrest and hold departure order issued against complainant and narrated how she was able to defend
complainant in the said cases.25
By April 2004, however, complainant noticed that respondent was evading him. Respondent would either refuse to
return complainant’s call or would abruptly terminate their telephone conversation, citing several reasons. This went
on for several months.26 In one instance, when complainant asked respondent for an update on the collection of
Benefon’s obligation to Precedent which respondent had previously taken charge of, respondent arrogantly answered
that she was very busy and that she would read Benefon’s letter only when she found time to do so.
On November 9, 2004, fed up and dismayed with respondent’s arrogance and evasiveness, complainant wrote
respondent a letter formally asking for a full accounting of all the money, documents and properties given to the
latter.27 Respondent rendered an accounting through a letter dated December 20, 2004. 28 When complainant found
respondent’s explanation to be inadequate, he wrote a latter expressing his confusion about the
accounting.29Complainant repeated his request for an audited financial report of all the properties turned over to her;
otherwise, he will be constrained to file the appropriate case against respondent. 30 Respondent replied,31 explaining
that all the properties and cash turned over to her by complainant had been returned to her clients who had money
claims against Multitel. In exchange for this, she said that she was able to secure quitclaim documents clearing
complainant from any liability.32 Still unsatisfied, complainant decided to file an affidavit-complaint 33 against
respondent before the Commission on Bar Discipline of the Integrated Bar of the Philippines (IBP) seeking the
disbarment of respondent.
In her Answer-Affidavit,34 respondent vehemently denied being the lawyer for Precedent. She maintained that no
formal engagement was executed between her and complainant. She claimed that she merely helped complainant by
providing him with legal advice and assistance because she personally knew him, since they both belonged to the
same religious organization.35 lavvph!1

Respondent insisted that she represented the group of investors of Multitel and that she merely mediated in the
settlement of the claims her clients had against the complainant. She also averred that the results of the settlement
between both parties were fully documented and accounted for. 36 Respondent believes that her act in helping
complainant resolve his legal problem did not violate any ethical standard and was, in fact, in accord with Rule 2.02
of the Code of Professional Responsibility.37
To bolster her claim that the complaint was without basis, respondent noted that a complaint for estafa was also filed
against her by complainant before the Office of the City Prosecutor in Quezon City citing the same grounds. The
complaint was, however, dismissed by Assistant City Prosecutor Josephus Joannes H. Asis for insufficiency of
evidence.38 Respondent argued that on this basis alone, the administrative case must also be dismissed.
In her Position Paper,39 respondent also questioned the admissibility of the electronic evidence submitted by
complainant to the IBP’s Commission on Bar Discipline. Respondent maintained that the e-mail and the text messages
allegedly sent by respondent to complainant were of doubtful authenticity and should be excluded as evidence for
failure to conform to the Rules on Electronic Evidence (A.M. No. 01-7-01-SC).
After due hearing, IBP Investigating Commissioner Patrick M. Velez issued a Report and Recommendation 40 finding
that a lawyer-client relationship was established between respondent and complainant despite the absence of a written
contract. The Investigating Commissioner also declared that respondent violated her duty to be candid, fair and loyal
to her client when she allowed herself to represent conflicting interests and failed to render a full accounting of all the
cash and properties entrusted to her. Based on these grounds, the Investigating Commissioner recommended her
disbarment.
Respondent moved for reconsideration,41 but the IBP Board of Governors issued a Recommendation 42 denying the
motion and adopting the findings of the Investigating Commissioner.
The case now comes before this Court for final action.
We affirm the findings of the IBP.
Rule 15.03, Canon 15 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
full disclosure of the facts.
This prohibition is founded on principles of public policy, good taste 43 and, more importantly, upon necessity. In the
course of a lawyer-client relationship, the lawyer learns all the facts connected with the client’s case, including its
weak and strong points. Such knowledge must be considered sacred and guarded with care. No opportunity must be
given to him to take advantage of his client; for if the confidence is abused, the profession will suffer by the loss
thereof.44 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 paramount in the administration of justice.45 It is for these reasons that we have described the attorney-client
relationship as one of trust and confidence of the highest degree. 46
Respondent must have known that her act of constantly and actively communicating with complainant, who, at that
time, was beleaguered with demands from investors of Multitel, eventually led to the establishment of a lawyer-client
relationship. Respondent cannot shield herself from the inevitable consequences of her actions by simply saying that
the assistance she rendered to complainant was only in the form of "friendly accommodations," 47 precisely because at
the time she was giving assistance to complainant, she was already privy to the cause of the opposing parties who had
been referred to her by the SEC.48
Respondent also tries to disprove the existence of such relationship by arguing that no written contract for the
engagement of her services was ever forged between her and complainant. 49 This argument all the more reveals
respondent’s patent ignorance of fundamental laws on contracts and of basic ethical standards expected from an
advocate of justice. The IBP was correct when it said:
The absence of a written contract will not preclude the finding that there was a professional relationship between the
parties. Documentary formalism is not an essential element in the employment of an attorney; the contract may be
express or implied. To establish the relation, it is sufficient that the advice and assistance of an attorney is sought and
received in any matter pertinent to his profession.50 (Emphasis supplied.) 1awphi1

Given the situation, the most decent and ethical thing which respondent should have done was either to advise
complainant to engage the services of another lawyer since she was already representing the opposing parties, or to
desist from acting as representative of Multitel investors and stand as counsel for complainant. She cannot be
permitted to do both because that would amount to double-dealing and violate our ethical rules on conflict of interest.
In Hornilla v. Atty. Salunat,51 we explained the concept of conflict of interest, thus:
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." This rule covers not only cases in which confidential communications have been confided, but also those
in which no confidence has been bestowed or will be used. Also, there is conflict of interests if the acceptance of the
new retainer will require the attorney to perform an act which will injuriously affect his first client in any matter in
which he represents him and also whether he will be called upon in his new relation to use against his first client any
knowledge acquired through their connection. Another test of the inconsistency of interests is whether the acceptance
of a new relation will prevent an attorney from the full discharge of his duty of undivided fidelity and loyalty to his
client or invite suspicion of unfaithfulness or double dealing in the performance thereof. 52
Indubitably, respondent took advantage of complainant’s hapless situation, initially, by giving him legal advice and,
later on, by soliciting money and properties from him. Thereafter, respondent impressed upon complainant that she
had acted with utmost sincerity in helping him divest all the properties entrusted to him in order to absolve him from
any liability. But simultaneously, she was also doing the same thing to impress upon her clients, the party claimants
against Multitel, that she was doing everything to reclaim the money they invested with Multitel. Respondent herself
admitted to complainant that without the latter’s help, she would not have been able to earn as much and that, as a
token of her appreciation, she was willing to share some of her earnings with complainant. 53 Clearly, respondent’s act
is shocking, as it not only violated Rule 9.02, Canon 9 of the Code of Professional Responsibility, 54 but also toyed
with decency and good taste.
Respondent even had the temerity to boast that no Multitel client had ever complained of respondent’s unethical
behavior.55 This remark indubitably displays respondent’s gross ignorance of disciplinary procedure in the Bar. As a
member of the Bar, she is expected to know that proceedings for disciplinary actions against any lawyer may be
initiated and prosecuted by the IBP Board of Governors, motu proprio or upon referral by this Court or by the Board
of Officers of an IBP Chapter56 even if no private individual files any administrative complaint.
Upon review, we find no cogent reason to disturb the findings and recommendations of the IBP Investigating
Commissioner, as adopted by the IBP Board of Governors, on the admissibility of the electronic evidence submitted
by complainant. We, accordingly, adopt the same in toto.
Finally, respondent argues that the recommendation of the IBP Board of Governors to disbar her on the grounds of
deceit, malpractice and other gross misconduct, aside from violation of the Lawyer’s Oath, has been rendered moot
and academic by voluntary termination of her IBP membership, allegedly after she had been placed under the
Department of Justice’s Witness Protection Program. 57 Convenient as it may be for respondent to sever her
membership in the integrated bar, this Court cannot allow her to do so without resolving first this administrative case
against her.
The resolution of the administrative case filed against respondent is necessary in order to determine the degree of her
culpability and liability to complainant. The case may not be dismissed or rendered moot and academic by
respondent’s act of voluntarily terminating her membership in the Bar regardless of the reason for doing so. This is
because membership in the Bar is a privilege burdened with conditions. 58 The conduct of a lawyer may make him or
her civilly, if not criminally, liable to his client or to third parties, and such liability may be conveniently avoided if
this Court were to allow voluntary termination of membership. Hence, to terminate one’s membership in the Bar
voluntarily, it is imperative that the lawyer first prove that the voluntary withdrawal of membership is not a ploy to
further prejudice the public or to evade liability. No such proof exists in the present case.
WHEREFORE, respondent Attorney Maricel Pascual-Lopez is hereby DISBARRED for representing conflicting
interests and for engaging in unlawful, dishonest and deceitful conduct in violation of her Lawyer’s Oath and the
Code of Professional Responsibility.
Let a copy of this Decision be entered in the respondent’s record as a member of the Bar, and notice of the same be
served on the Integrated Bar of the Philippines, and on the Office of the Court Administrator for circulation to all
courts in the country.
SO ORDERED.

G. R. No. 195002 January 25, 2012

HECTOR TREÑAS, Petitioner,
vs.
PEOPLE OF THE PHILIPPINES, Respondent.
DECISION
SERENO, J.:
Where life or liberty is affected by its proceedings, courts must keep strictly within the limits of the law authorizing
them to take jurisdiction and to try the case and render judgment thereon.1
This is a Petition for Review on Certiorari under Rule 45 of the 1997 Revised Rules of Civil Procedure, seeking to
annul and set aside the Court of Appeals (CA) Decision dated 9 July 2010 2 and Resolution dated 4 January 2011.
Statement of the Facts and of the Case
The pertinent facts, as found by the CA, are as follows:
Sometime in December 1999, Margarita Alocilja (Margarita) wanted to buy a house-and-lot in Iloilo City covered by
TCT No. 109266. It was then mortgaged with Maybank. The bank manager Joselito Palma recommended the
appellant Hector Treñas (Hector) to private complainant Elizabeth, who was an employee and niece of Margarita, for
advice regarding the transfer of the title in the latter’s name. Hector informed Elizabeth that for the titling of the
property in the name of her aunt Margarita, the following expenses would be incurred:
P20,000.00- Attorney’s fees,
P90,000.00- Capital Gains Tax,
P24,000.00- Documentary Stamp,
P10,000.00- Miscellaneous Expenses.
Thereafter, Elizabeth gave P150,000.00 to Hector who issued a corresponding receipt dated December 22, 1999 and
prepared [a] Deed of Sale with Assumption of Mortgage. Subsequently, Hector gave Elizabeth Revenue Official
Receipt Nos. 00084370 for P96,000.00 and 00084369 for P24,000.00. However, when she consulted with the BIR,
she was informed that the receipts were fake. When confronted, Hector admitted to her that the receipts were fake and
that he used the P120,000.00 for his other transactions. Elizabeth demanded the return of the money.
To settle his accounts, appellant Hector issued in favor of Elizabeth a Bank of Commerce check No. 0042856 dated
November 10, 2000 in the amount of P120,000.00, deducting from P150,000.00 the P30,000.00 as attorney’s fees.
When the check was deposited with the PCIBank, Makati Branch, the same was dishonored for the reason that the
account was closed. Notwithstanding repeated formal and verbal demands, appellant failed to pay. Thus, the instant
case of Estafa was filed against him.3
On 29 October 2001, an Information was filed by the Office of the City Prosecutor before the Regional Trial Court
(RTC), both of Makati City. The Information reads as follows:
That on or about the 23rd day of December, 1999, in the City of Makati, Metro Manila, Philippines and within the
jurisdiction of this Honorable Court, the above-named accused, received in trust from ELIZABETH LUCIAJA the
amount of P150,000.00 which money was given to her by her aunt Margarita Alocilja, with the express obligation on
the part of the accused to use the said amount for expenses and fees in connection with the purchase of a parcel of
land covered by TCT No. T-109266, but the said accused, once in possession of the said amount, with the intent to
gain and abuse of confidence, did then and there willfully, unlawfully and feloniously misappropriate, misapply and
convert to his own personal use and benefit the amount of P130,000.00 less attorney’s fees and the said accused failed
and refused and still fails and refuses to do so, to the damage and prejudice of complainant Elizabeth Luciaja and
Margarita Alocilja in the aforementioned amount of P130,000.00.
CONTRARY TO LAW.4
During arraignment on 26 April 2002, petitioner, acting as his own counsel, entered a plea of "Not Guilty." Allegedly
due to old age and poor health, and the fact that he lives in Iloilo City, petitioner was unable to attend the pre-trial and
trial of the case.
On 8 January 2007, the RTC rendered a Decision 5 finding petitioner guilty of the crime of Estafa under section 1,
paragraph (b), of Article 315 of the Revised Penal Code (RPC), with the dispositive portion as follows:
WHEREFORE, in view of the foregoing, judgment is rendered finding accused Hector Trenas guilty of the crime of
Estafa with abuse of confidence as penalized under Article 315 of the Revised Penal Code, and which offense was
committed in the manner described in the aforementioned information. As a consequence of this judgment, accused
Hector Trenas is sentenced to suffer a penalty of Ten (10) Years and One (1) Day of Prision Mayor to Seventeen (17)
Years and Four (4) Months of Reclusion Temporal. Moreover, he is ordered to indemnify private complainant
Elizabeth Luciaja the amount of P130,000.00 with interest at the legal rate of 12% per annum, reckoned from the date
this case was filed until the amount is fully paid.
SO ORDERED.6
We note at this point that petitioner has been variably called Treñas and Trenas in the pleadings and court issuances,
but for consistency, we use the name "Treñas", under which he was accused in the Information.
On 24 August 2007, petitioner filed a Motion for Reconsideration, 7 which was denied by the RTC in a Resolution
dated 2 July 2008.8
On 25 September 2008, petitioner filed a Notice of Appeal before the RTC. 9 The appeal was docketed as CA-G.R. CR
No. 32177. On 9 July 2010, the CA rendered a Decision 10 affirming that of the RTC. On 4 August 2010, petitioner
filed a Motion for Reconsideration, which was denied by the CA in a Resolution dated 4 January 2011. 11
On 25 January 2011, petitioner filed a Motion for Extension of Time to File Petition for Review on Certiorari 12 before
this Court. He asked for a period of 15 days within which to file a petition for review, and the Court granted his
motion in a Resolution dated 9 February 2011.
On 3 February 2011, petitioner filed his Petition for Review on Certiorari before this Court, with the following
assignment of errors:
1. THE COURT OF APPEALS ERRED IN RULING THAT AN ACCUSED HAS TO PRESENT
EVIDENCE IN SUPPORT OF THE DEFENSE OF LACK OF JURISDICTION EVEN IF SUCH LACK OF
JURISDICTION APPEARS IN THE EVIDENCE OF THE PROSECUTION;
2. THE COURT OF APPEALS ERRED IN RULING THAT DEMAND MADE BY A PERSON OTHER
THAN THE AGGRIEVED PARTY SATISFIES THE REQUIREMENT OF DEMAND TO CONSTITUTE
THE OFFENSE OF ESTAFA;13
On the first issue, petitioner asserts that nowhere in the evidence presented by the prosecution does it show that ₱
150,000 was given to and received by petitioner in Makati City. Instead, the evidence shows that the Receipt issued by
petitioner for the money was dated 22 December 1999, without any indication of the place where it was issued.
Meanwhile, the Deed of Sale with Assumption of Mortgage prepared by petitioner was signed and notarized in Iloilo
City, also on 22 December 1999. Petitioner claims that the only logical conclusion is that the money was actually
delivered to him in Iloilo City, especially since his residence and office were situated there as well. Absent any direct
proof as to the place of delivery, one must rely on the disputable presumption that things happened according to the
ordinary course of nature and the ordinary habits of life. The only time Makati City was mentioned was with respect
to the time when the check provided by petitioner was dishonored by Equitable-PCI Bank in its De la Rosa-Rada
Branch in Makati. Petitioner asserts that the prosecution witness failed to allege that any of the acts material to the
crime of estafa had occurred in Makati City. Thus, the trial court failed to acquire jurisdiction over the case.
Petitioner thus argues that an accused is not required to present evidence to prove lack of jurisdiction, when such lack
is already indicated in the prosecution evidence.
As to the second issue, petitioner claims that the amount of P150,000 actually belongs to Margarita. Assuming there
was misappropriation, it was actually she – not Elizabeth – who was the offended party. Thus, the latter’s demand
does not satisfy the requirement of prior demand by the offended party in the offense of estafa. Even assuming that the
demand could have been properly made by Elizabeth, the demand referred to the amount of P120,000, instead of
P150,000. Finally, there is no showing that the demand was actually received by petitioner. The signature on the
Registry Return Receipt was not proven to be that of petitioner’s.
On 30 May 2011, this Court issued a Resolution directing the Office of the Solicitor General (OSG) to file the latter’s
Comment on the Petition. On 27 July 2011, the OSG filed a Motion for Extension, praying for an additional period of
60 days within which to submit its Comment. This motion was granted in a Resolution dated 12 September 2011. On
23 September 2011, the OSG filed a Motion for Special Extension, requesting an additional period of five days. On 29
September 2011, it filed its Comment on the Petition.
In its Comment, the OSG asserts that the RTC did not err in convicting petitioner as charged. The OSG notes that
petitioner does not dispute the factual findings of the trial court with respect to the delivery of ₱150,000 to him, and
that there was a relationship of trust and confidence between him and Elizabeth. With respect to his claim that the
Complaint should have been filed in Iloilo City, his claim was not supported by any piece of evidence, as he did not
present any. Further, petitioner is, in effect, asking the Court to weigh the credibility of the prosecution witness,
Elizabeth. However, the trial court’s assessment of the credibility of a witness is entitled to great weight, unless tainted
with arbitrariness or oversight of some fact or circumstance, which is not the case here.
With respect to the second issue, the OSG stresses that the defense of "no valid demand" was not raised in the lower
court. Nevertheless, the demand letter sent to Elizabeth suffices, as she is also one of the complainants alleged in the
Information, as an agent of Margarita. Moreover, no proof was adduced as to the genuineness of petitioner’s signature
in the Registry Return Receipt of the demand letter.
The OSG, however, submits that the Court may recommend petitioner for executive clemency, in view of his
advanced age and failing health.
The Court’s Ruling
The Petition is impressed with merit.
Review of Factual Findings
While the Petition raises questions of law, the resolution of the Petition requires a review of the factual findings of the
lower courts and the evidence upon which they are based.
As a rule, only questions of law may be raised in a petition for review under Rule 45 of the Rules of Court. In many
instances, however, this Court has laid down exceptions to this general rule, as follows:
(1) When the factual findings of the Court of Appeals and the trial court are contradictory;
(2) When the conclusion is a finding grounded entirely on speculation, surmises or conjectures;
(3) When the inference made by the Court of Appeals from its findings of fact is manifestly mistaken, absurd
or impossible;
(4) When there is grave abuse of discretion in the appreciation of facts;
(5) When the appellate court, in making its findings, went beyond the issues of the case, and such findings are
contrary to the admissions of both appellant and appellee;
(6) When the judgment of the Court of Appeals is premised on misapprehension of facts;
(7) When the Court of Appeals failed to notice certain relevant facts which, if properly considered, would
justify a different conclusion;
(8) When the findings of fact are themselves conflicting;
(9) When the findings of fact are conclusions without citation of the specific evidence on which they are
based; and
(10) When the findings of fact of the Court of Appeals are premised on the absence of evidence but such
findings are contradicted by the evidence on record.14
In this case, the findings of fact of the trial court and the CA on the issue of the place of commission of the offense are
conclusions without any citation of the specific evidence on which they are based; they are grounded on conclusions
and conjectures.
The trial court, in its Decision, ruled on the commission of the offense without any finding as to where it was
committed:
Based on the evidence presented by the prosecution through private complainant Elizabeth Luciaja, the Court is
convinced that accused Trenas had committed the offense of Estafa by taking advantage of her trust so that he could
misappropriate for his own personal benefit the amount entrusted to him for payment of the capital gains tax and
documentary stamp tax.
As clearly narrated by private complainant Luciaja, after accused Trenas had obtained the amount of P150,000.00
from her, he gave her two receipts purportedly issued by the Bureau of Internal Revenue, for the fraudulent purpose of
fooling her and making her believe that he had complied with his duty to pay the aforementioned taxes. Eventually,
private complainant Luciaja discovered that said receipts were fabricated documents.15
In his Motion for Reconsideration before the RTC, petitioner raised the argument that it had no jurisdiction over the
offense charged. The trial court denied the motion, without citing any specific evidence upon which its findings were
based, and by relying on conjecture, thus:
That the said amount was given to [Treñas] in Makati City was incontrovertibly established by the prosecution.
Accused Treñas, on the other hand, never appeared in Court to present countervailing evidence. It is only now that he
is suggesting another possible scenario, not based on the evidence, but on mere "what ifs". x x x
Besides, if this Court were to seriously assay his assertions, the same would still not warrant a reversal of the assailed
judgment. Even if the Deed of Sale with Assumption of Mortgage was executed on 22 December 999 in Iloilo City, it
cannot preclude the fact that the P150,000.00 was delivered to him by private complainant Luciaja in Makati City the
following day. His reasoning the money must have been delivered to him in Iloilo City because it was to be used for
paying the taxes with the BIR office in that city does not inspire concurrence. The records show that he did not even
pay the taxes because the BIR receipts he gave to private complainant were fake documents. Thus, his argumentation
in this regard is too specious to consider favorably.16
For its part, the CA ruled on the issue of the trial court’s jurisdiction in this wise:
It is a settled jurisprudence that the court will not entertain evidence unless it is offered in evidence. It bears emphasis
that Hector did not comment on the formal offer of prosecution’s evidence nor present any evidence on his behalf. He
failed to substantiate his allegations that he had received the amount of P150,000.00 in Iloilo City. Hence, Hector’s
allegations cannot be given evidentiary weight.
Absent any showing of a fact or circumstance of weight and influence which would appear to have been overlooked
and, if considered, could affect the outcome of the case, the factual findings and assessment on the credibility of a
witness made by the trial court remain binding on appellate tribunal. They are entitled to great weight and respect and
will not be disturbed on review.17
The instant case is thus an exception allowing a review of the factual findings of the lower courts.
Jurisdiction of the Trial Court
The overarching consideration in this case is the principle that, in criminal cases, venue is jurisdictional. A court
cannot exercise jurisdiction over a person charged with an offense committed outside its limited territory. In Isip v.
People,18 this Court explained:
The place where the crime was committed determines not only the venue of the action but is an essential element of
jurisdiction. It is a fundamental rule that for jurisdiction to be acquired by courts in criminal cases, the offense should
have been committed or any one of its essential ingredients should have taken place within the territorial jurisdiction
of the court. Territorial jurisdiction in criminal cases is the territory where the court has jurisdiction to take cognizance
or to try the offense allegedly committed therein by the accused. Thus, it cannot take jurisdiction over a person
charged with an offense allegedly committed outside of that limited territory. Furthermore, the jurisdiction of a court
over the criminal case is determined by the allegations in the complaint or information. And once it is so shown, the
court may validly take cognizance of the case. However, if the evidence adduced during the trial shows that the
offense was committed somewhere else, the court should dismiss the action for want of jurisdiction. (Emphasis
supplied.)
In a criminal case, the prosecution must not only prove that the offense was committed, it must also prove the identity
of the accused and the fact that the offense was committed within the jurisdiction of the court.
In Fukuzume v. People,19 this Court dismissed a Complaint for estafa, wherein the prosecution failed to prove that the
essential elements of the offense took place within the trial court’s jurisdiction. The Court ruled:
More importantly, we find nothing in the direct or cross-examination of Yu to establish that he gave any money to
Fukuzume or transacted business with him with respect to the subject aluminum scrap wires inside or within the
premises of the Intercontinental Hotel in Makati, or anywhere in Makati for that matter. Venue in criminal cases is an
essential element of jurisdiction. x x x
In the present case, the criminal information against Fukuzume was filed with and tried by the RTC of Makati. He was
charged with estafa as defined under Article 315, paragraph 2(a) of the Revised Penal Code, the elements of which are
as follows: x x x
The crime was alleged in the Information as having been committed in Makati. However, aside from the sworn
statement executed by Yu on April 19, 1994, the prosecution presented no other evidence, testimonial or documentary,
to corroborate Yu's sworn statement or to prove that any of the above-enumerated elements of the offense charged was
committed in Makati. Indeed, the prosecution failed to establish that any of the subsequent payments made by Yu in
the amounts of P50,000.00 on July 12, 1991, P20,000.00 on July 22, 1991, P50,000.00 on October 14, 1991 and
P170,000.00 on October 18, 1991 was given in Makati. Neither was there proof to show that the certifications
purporting to prove that NAPOCOR has in its custody the subject aluminum scrap wires and that Fukuzume is
authorized by Furukawa to sell the same were given by Fukuzume to Yu in Makati. On the contrary, the testimony of
Yu established that all the elements of the offense charged had been committed in Parañaque, to wit: that on July 12,
1991, Yu went to the house of Fukuzume in Parañaque; that with the intention of selling the subject aluminum scrap
wires, the latter pretended that he is a representative of Furukawa who is authorized to sell the said scrap wires; that
based on the false pretense of Fukuzume, Yu agreed to buy the subject aluminum scrap wires; that Yu paid Fukuzume
the initial amount of P50,000.00; that as a result, Yu suffered damage. Stated differently, the crime of estafa, as
defined and penalized under Article 315, paragraph 2(a) of the Revised Penal Code, was consummated when Yu and
Fukuzume met at the latter's house in Parañaque and, by falsely pretending to sell aluminum scrap wires, Fukuzume
was able to induce Yu to part with his money.
xxx
From the foregoing, it is evident that the prosecution failed to prove that Fukuzume committed the crime of estafa in
Makati or that any of the essential ingredients of the offense took place in the said city. Hence, the judgment of the
trial court convicting Fukuzume of the crime of estafa should be set aside for want of jurisdiction, without prejudice,
however, to the filing of appropriate charges with the court of competent jurisdiction. (Emphasis supplied)
In this case, the prosecution failed to show that the offense of estafa under Section 1, paragraph (b) of Article 315 of
the RPC was committed within the jurisdiction of the RTC of Makati City.
That the offense was committed in Makati City was alleged in the information as follows:
That on or about the 23rd day of December, 1999, in the City of Makati, Metro Manila, Philippines and within the
jurisdiction of this Honorable Court, the above-named accused, received in trust from ELIZABETH LUCIAJA the
amount of P150,000.00 x x x. (Emphasis supplied.)20
Ordinarily, this statement would have been sufficient to vest jurisdiction in the RTC of Makati. However, the Affidavit
of Complaint executed by Elizabeth does not contain any allegation as to where the offense was committed. It
provides in part:
4. THAT on 23 December 1999, [Elizabeth] personally entrusted to ATTY. HECTOR TREÑAS the sum of
P150,000.00 to be expended as agreed and ATTY. HECTOR TREÑAS issued to me a receipt, a photo copy of
which is hereto attached as Annex "B",
5. THAT despite my several follow-ups with ATTY. HECTOR TREÑAS, the latter failed to transfer the title
of aforesaid property to MRS. MARGARITA ALOCILJA. He also failed to pay the capital gains tax,
documentary stamps and BIR-related expenses. What ATTY. HECTOR TREÑAS accomplished was only the
preparation of the Deed of Sale covering aforesaid property. A copy of said Deed of Sale is hereto attached as
Annex "C",
6. THAT in view of my persistent follow-ups, ATTY. HECTOR TREÑAS issued to me a check for refund of
the sum given to him less the attorney’s fee of P20,000.00 and the sum of P10,000.00 allegedly paid to BIR or
in the net sum of P120,000.00. x x x
7. THAT when said check was deposited at EQUITABLE PCI BANK dela Rosa-Rada Branch at Makati City,
the same was dishonored by the drawee bank for the reason: ACCOUNT CLOSED. x x x 21
Aside from the lone allegation in the Information, no other evidence was presented by the prosecution to prove that
the offense or any of its elements was committed in Makati City.
Under Article 315, par. 1 (b) of the RPC, the elements of estafa are as follows: (1) that money, goods or other personal
property is received by the offender in trust or on commission, or for administration, or under any other obligation
involving the duty to make delivery of or to return the same; (2) that there be misappropriation or conversion of such
money or property by the offender, or denial on his part of such receipt; (3) that such misappropriation or conversion
or denial is to the prejudice of another; and (4) there is demand by the offended party to the offender. 22
There is nothing in the documentary evidence offered by the prosecution 23 that points to where the offense, or any of
its elements, was committed. A review of the testimony of Elizabeth also shows that there was no mention of the place
where the offense was allegedly committed:
Q After the manager of Maybank referred Atty. Treñas to you, what happened next?
A We have met and he explained to the expenses and what we will have to… and she will work for the Deed
of Sale.
 Q And did he quote any amount when you got to the expenses?
A Yes. I gave him ONE HUNDRED FIFTY THOUSAND.
Q What was the amount quoted to you?
A ONE HUNDRED FIFTY THOUSAND.
Q Did he give a breakdown of this ONE HUNDRED FIFTY THOUSAND?
A Yes, sir.
Q And what is the breakdown of this ONE HUNDRED FIFTY THOUSAND?
A TWENTY THOUSAND is for his Attorney’s fee, NINETY THOUSAND is for the capital gain tax
TWENTY FOUR THOUSAND is intended for documentary sum (sic) and TEN THOUSAND PESOS is for
other expenses for BIR.
Q And did you give him this ONE HUNDRED FIFTY THOUSAND?
A Yes, sir.
Q Did he issue a receipt?
A Yes, sir.
Q If shown to you a receipt issued by Atty. Treñas for this ONE HUNDRED FIFTY THOUSAND, will you
be able to identify it?
A Yes, sir.
Q I am showing to you a document, madam witness, already identified during the pre-trial as exhibit "B".
This appears to be a receipt dated December 22, 1999. Will you please go over this document and inform this
court what relation has this to the receipt which you said Atty. Treñas issued to you?
A This is the receipt issued by Atty. Hector Treñas.
Q Now, after the amount of ONE HUNDRED FIFTY THOUSAND was given to Atty. Treñas by you, what
happened next?
A We made several follow-ups but he failed to do his job.24
Although the prosecution alleged that the check issued by petitioner was dishonored in a bank in Makati, such
dishonor is not an element of the offense of estafa under Article 315, par. 1 (b) of the RPC.
Indeed, other than the lone allegation in the information, there is nothing in the prosecution evidence which even
mentions that any of the elements of the offense were committed in Makati. The rule is settled that an objection may
be raised based on the ground that the court lacks jurisdiction over the offense charged, or it may be considered motu
proprio by the court at any stage of the proceedings or on appeal. 25 Moreover, jurisdiction over the subject matter in a
criminal case cannot be conferred upon the court by the accused, by express waiver or otherwise. That jurisdiction is
conferred
by the sovereign authority that organized the court and is given only by law in the manner and form prescribed by
law.26
It has been consistently held by this Court that it is unfair to require a defendant or accused to undergo the ordeal and
expense of a trial if the court has no jurisdiction over the subject matter or offense or it is not the court of proper
venue.27 Section 15 (a) of Rule 110 of the Revised Rules on Criminal Procedure of 2000 provides that "[s]ubject to
existing laws, the criminal action shall be instituted and tried in the court of the municipality or territory where the
offense was committed or where any of its essential ingredients occurred." This fundamental principle is to ensure that
the defendant is not compelled to move to, and appear in, a different court from that of the province where the crime
was committed as it would cause him great inconvenience in looking for his witnesses and other evidence in another
place.28 This principle echoes more strongly in this case, where, due to distance constraints, coupled with his advanced
age and failing health, petitioner was unable to present his defense in the charges against him.
There being no showing that the offense was committed within Makati, the RTC of that city has no jurisdiction over
the case.29
As such, there is no more need to discuss the other issue raised by petitioner.
At this juncture, this Court sees it fit to note that the Code of Professional Responsibility strongly militates against the
petitioner’s conduct in handling the funds of his client. Rules 16.01 and 16.02 of the Code provides:
Rule 16.01 — A lawyer shall account for all money or property collected or received for or from the client. 1âwphi1

Rule 16.02 — A lawyer shall keep the funds of each client separate and apart from his own and those others kept by
him.
When a lawyer collects or receives money from his client for a particular purpose (such as for filing fees, registration
fees, transportation and office expenses), he should promptly account to the client how the money was spent. 30 If he
does not use the money for its intended purpose, he must immediately return it to the client. His failure either to
render an accounting or to return the money (if the intended purpose of the money does not materialize) constitutes a
blatant disregard of Rule 16.01 of the Code of Professional Responsibility.31
Moreover, a lawyer has the duty to deliver his client's funds or properties as they fall due or upon demand. 32 His
failure to return the client's money upon demand gives rise to the presumption that he has misappropriated it for his
own use to the prejudice of and in violation of the trust reposed in him by the client. 33 It is a gross violation of general
morality as well as of professional ethics; it impairs public confidence in the legal profession and deserves
punishment.34
In Cuizon v. Macalino,35 this Court ruled that the issuance of checks which were later dishonored for having been
drawn against a closed account indicates a lawyer's unfitness for the trust and confidence reposed on him, shows lack
of personal honesty and good moral character as to render him unworthy of public confidence, and constitutes a
ground for disciplinary action.
This case is thus referred to the Integrated Bar of the Philippines (IBP) for the initiation of disciplinary proceedings
against petitioner. In any case, should there be a finding that petitioner has failed to account for the funds received by
him in trust, the recommendation should include an order to immediately return the amount of ₱ 130,000 to his client,
with the appropriate rate of interest from the time of demand until full payment.
WHEREFORE, the Petition is GRANTED. The Decision dated 9 July 2010 and the Resolution dated 4 January 2011
issued by the Court of Appeals in CA-G.R. CR No. 32177 are SET ASIDE on the ground of lack of jurisdiction on the
part of the Regional Trial Court, Branch 137, Makati City. Criminal Case No. 01-2409 is DISMISSED without
prejudice. This case is REFERRED to the IBP Board of Governors for investigation and recommendation pursuant to
Section 1 of Rule 139-B of the Rules of Court.
SO ORDERED.

A.C. No. 5440 December 10, 2014

SPOUSES NICASIO DONELITA SAN PEDRO, Complainants,
vs.
ATTY. ISAGANI A. MENDOZA, Respondent.
RESOLUTION
LEONEN, J.:
For resolution is a complaint for disbarment filed by Spouses Nicasio and Donelita San Pedro (complainants) against
Atty. Isagani A. Mendoza (respondent).1 This case involves a determination of whether respondent violated his duty to
hold in trust all moneys and properties of the client; his duty to account for all funds and property collected or
received for or from the client; and his duty to deliver the funds and property of the client when due or upon demand
under the Code of Professional Responsibility.
The facts are summarized as follows:
On or about November 21, 1996, complainants engaged the services of respondent to facilitate the transfer of title to
property, in the name of Isabel Azcarraga Marcaida, to complainants. 2 Complainants then gave respondent a check for
₱68,250.00 for the payment of transfer taxes. 3 They also gave respondent a check for ₱13,800.00 for respondent’s
professional fee.4
Respondent failed to produce the title despite complainants’ repeated follow-ups. 5
Several letters were sent by respondent explaining the delay in the transfer of title. 6 However, respondent still failed to
produce the title.
Complainants subsequently referred the case to the barangay. 7 Respondent refused to return the amount complainants
gave for the transfer taxes.8 Complainants were then issued a certificate to file action. 9 They also sent a letter
demanding the refund of the money intended for the transfer taxes.10 Respondent still did not return the money.
On May 8, 2000, respondent sent another letter to complainants. He promised to settle the transfer of the land
title.11However, respondent reneged on this promise.12 Complainants were then forced to obtain a loan from Philippine
American Life and General Insurance Company to secure the transfer of the title to the property in their names. 13
Respondent contested the allegations of complainants. According to him, it was complainants who caused the three-
year delay in the transfer of title to complainants’ names. Complainants were not able to furnish respondent several
important documents: (a) original copy of the deed of extrajudicial petition; (b) affidavit of publication with the
clippings of the published item in a newspaper of general circulation; and (c) a barangay certificate from the barangay
where the property is located as required by the Bureau of Internal Revenue.14
In addition, respondent argued that complainants paid him the measly sum of ₱13,800.00 despite all the work he did
for them, including facilitating the sale of the property. These involved "being-pulled from the office four or five times
to discuss . . . the details of the transaction [with the sellers]; going twice to the Regional Trial Court of Biñan,
Laguna[,] Branch 24, to expedite the . . . issuance of a [n]ew owner’s duplicate copy of the title; going twice to the
office of the Register of Deeds for Calamba, Laguna to make verification and submit the court [o]rder; [and
facilitating the] preparation and notarization of the Deed of Absolute Sale."15
Respondent also claimed that retention of the money is justified owing to his receivables from complainants for the
services he rendered in various cases:
1) In the case of Spouses Nicasio and Donelita San Pedro versus Severo Basbas, for Forcible Entry, docketed
as Civil Case No. 2004 in the Metropolitan Trial Court of Santa Rosa, Laguna. This case was dismissed by
the Honorable Court for alleged lack of jurisdiction, the issue of possession being intertwined with that of
ownership;
2) In the case of Spouses Nicasio and Donelita San Pedro versus Severo Basbas for Accion Publiciana
docketed as Civil Case No. B-5386 raffled to the Regional Trial Court of Biñan, Laguna[,] Branch 25;
3) In Civil Case No. B-4503 entitled Basbas versus Spouses Nicasio and Donelita San Pedro et al., for nullity
of title, [r]econveyance with prayer for issuance of writ of preliminary injunction directed specifically to
herein complainant. This case was assigned to the Regional Trial Court of San Pedro, Laguna[.] Respondent,
for and in behalf of herein complainant, submitted an [a]nswer and [o]pposition to the prayer for issuance of
the injunction, which was favorably acted upon. Consequently[,] the case was dismissed by the Court[;]
4) In Civil Case No. B-688 entitled Basbas versus Spouses Nicasio and Donelita San Pedro et al., for [r]e-
partition and [r]econveyance, which was raffled to the Regional Trial Court of Biñan, Laguna, Branch 24[;]
[and]
5) Likewise, respondent represented herein complainant in [an] ESTAFA case they [filed] against Greg
Ramos and Benjamin Corsino, which case, as per reliable source, was discontinued by complainant after the
civil aspect of the same was amicably settled. 16 Respondent further alleged that complainants challenged him
to prove his worth as a lawyer by doing away with the requirements and expediting the cancellation of the
Marcaidas’ title.17
The present administrative case was referred to the Integrated Bar of the Philippines (IBP) for investigation, report
and recommendation.18 The parties were then called to a mandatory conference before the IBP Commission on Bar
Discipline.19 They were required to submit their position papers.20 Respondent did not submit his position paper.21
On July 8, 2008, the Investigating Commissioner, Atty. Salvador B. Hababag, submitted his findings and
recommendation. The Investigating Commissioner found that respondent violated Canon 16, Rules 16.01 22 and
16.0323 of the Code of Professional Responsibility.
The Investigating Commissioner found that both checks issued to respondent were encashed despite respondent’s
failure to facilitate the release of the title in the name of complainants. 24 Complainants had to obtain a loan to facilitate
the transfer of title in their names.25
Moreover, respondent admitted his liability in his letters to complainants. 26 Complainant Nicasio San Pedro’s affidavit
of desistance is immaterial.27
The Investigating Commissioner recommended the disciplinary action of "censure and warning," hence:
WHEREFORE, premises considered, it is most respectfully recommended that the disciplinary sanction of CENSURE
and WARNING be given the respondent with the admonition that he be extremely careful of his acts to forego severe
penalty in the future.28
In the Notice of Resolution No. XVIII-2008-399 dated August 14, 2008, the IBP Board of Governors adopted with
modification the findings of the Investigating Commissioner. It held:
RESOLVED to ADOPT and APPROVE, as it is hereby unanimously ADOPTED and APPROVED, with modification,
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 for Respondent’s violation of Canon 16, [Rule] 16.01 and Rule 16.03 of the Code of
Professional Responsibility when he failed to effect the transfer of property despite encashment of the two checks,
Atty. Isagani A. Mendoza is hereby SUSPENDED from the practice of law for three (3) months and Ordered to
Returnthe amount of Sixty Eight Thousand Two Hundred Fifty (₱68,250.00) Pesos to complainants within thirty days
from receipt of notice.29 (Emphasis, italics, and underscoring in the original)
On November 14, 2008, respondent filed his motion for reconsideration. 30 The IBP Board of Governors denied
respondent’s motion in the Notice of Resolution No. XX-2013-839 dated June 22, 2013:
RESOLVED to unanimously DENY Respondent’s Motion for Reconsideration, there being no cogent reason to
reverse the findings of the Commission and it being a mere reiteration of the matters which had already been threshed
out and taken into consideration. Thus, Resolution No. XVIII-2008-399 dated August 14, 2008 is hereby
AFFIRMED.31 (Emphasis and italics in the original)
On December 11, 2013, this court resolved to note the following: (a) Notice of Resolution No. XVIII-2008-399 dated
August 14, 2008 of the IBP Board of Governors; (b) Notice of Resolution No. XX-2013-839 dated June 22, 2013 of
the IBP Board of Governors;and (c) IBP’s letter dated October 7, 2013 transmitting the documents pertaining to the
case.32
In the manifestation and motion dated October 25,2013, respondent requested for a formal hearing, reasoning that he
"wants to exercise his right to confront his accusers [to] cross[-]examine them and that of their witness." 33 The
manifestation and motion was denied by this court in the resolution dated September 22, 2014. 34
The main issue in this case is whether respondent is guilty of violating Canon 16 of the Code of Professional
Responsibility for failing to hold in trust the money of his clients.
After considering the parties’ arguments and the records of this case, this court resolves to adopt and approve the
Notice of Resolution No. XX-2013-839 dated June 22, 2013 of the IBP Board of Governors.
It has been said that "[t]he practice of law is a privilege bestowed on lawyers who meet the high standards oflegal
proficiency and morality. Any conduct that shows a violation of the norms and values of the legal profession exposes
the lawyer to administrative liability."35
An examination of the records reveals that respondent violated the Code of Professional Responsibility.
Canon 16 of the Code of Professional Responsibility states:
CANON 16 - A LAWYER SHALL HOLD IN TRUST ALL MONEYS AND PROPERTIES OF HIS CLIENT THAT
MAY COME INTO HIS POSSESSION.
Rule 16.01 – A lawyer shall account for all money or property collected or received for or from the client.
Rule 16.02 – A lawyer shall keep the funds of each client separate and apart from his own and those of others kept by
him.
Rule 16.03 – A lawyer shall deliver the funds and property of his client when due or upon demand. However, he shall
have a lien over the funds and may apply so much thereof as may be necessary to satisfy his lawful fees and
disbursements, giving notice promptly thereafter to his client. He shall also have a lien to the same extent on all
judgments and executions he has secured for his client as provided for in the Rules of Court.
Rule 16.04 – A lawyer shall not borrow money from his client unless the client’s interests are fully protected by the
nature of the case or by independent advice. Neither shall a lawyer lend money to a client except, when in the interest
of justice, he has to advance necessary expenses in a legal matter he is handling for the client.
Similarly, Rule138, Section 25 of the Rules of Court provides:
Section 25. Unlawful retention of client's funds; contempt. — When an attorney unjustly retains in his hands money of
his client after it has been demanded, he may be punished for contempt as an officer of the Court who has misbehaved
in his official transactions; but proceedings under this section shall not be a bar to a criminal prosecution.
A lawyer’s duty under Canon 16 of the Code of Professional Responsibility is clear:
The fiduciary nature of the relationship between counsel and client imposes on a lawyer the duty to account for the
money or property collected or received for or from the client[,] [thus] . . . [w]hen a lawyer collects or receives money
from his client for a particular purpose (such as for filing fees, registration fees, transportation and office expenses),
he should promptly account to the client how the money was spent. If he does not use the money for its intended
purpose, he must immediately return it to the client. His failure either to render an accounting or to return the money
(if the intended purpose of the money does not materialize) constitutes a blatant disregard of Rule 16.01 of the Code
of Professional Responsibility.
[The lawyer’s] failure to return the client’s money upon demand gives rise to the presumption that he has
misappropriated it for his own use to the prejudice of and in violation of the trust reposed in him by the
client.36(Emphasis supplied)
Respondent admitted that there were delays in the transfer of title of property to complainants’ name. He 1âwphi1

continuously assured complainants that he would still fulfill his duty. However, after three (3) years and several
demands from complainants, respondent failed to accomplish the task given to him and even refused to return the
money. Complainants’ alleged failure to provide the necessary documents to effect the transfer does not justify his
violation of his duty under the Code of Professional Responsibility.
Respondent’s assertion of a valid lawyer’s lien is also untenable. A valid retaining lien has the following elements:
An attorney’s retaining lien is fully recognized if the presence of the following elements concur: (1) lawyer-client
relationship; (2) lawful possession of the client’s funds, documents and papers; and (3) unsatisfied claim for attorney’s
fees. Further, the attorney’s retaining lien is a general lien for the balance of the account between the attorney and his
client, and applies to the documents and funds of the client which may come into the attorney’s possession in the
course of his employment.37
Respondent did not satisfy all the elements of a valid retaining lien. He did not present evidence as to an unsatisfied
claim for attorney’s fees. The enumeration of cases he worked on for complainants remains unsubstantiated. When
there is no unsatisfied claim for attorney’s fees, lawyers cannot validly retain their client’s funds or properties. 38
Furthermore, assuming that respondent had proven all the requisites for a valid retaining lien, he cannot appropriate
for himself his client's funds without the proper accounting and notice to the client. The rule is that when there is "a
disagreement, or when the client disputes the amount claimed by the lawyer . . . the lawyer should not arbitrarily apply
the funds in his possession to the payment of his fees .... "39
We also note that despite complainant Nicasio San Pedro's affidavit of desistance dated March 14, 2008, both
complainants signed their comment to respondent's motion for reconsideration and prayed that the motion be
dismissed for lack of merit.40
WHEREFORE, respondent Atty. Isagani A. Mendoza is SUSPENDED from the practice of law for three (3) months.
He is also ordered to RETURN to complainants the amount of ₱68,250.00 with 6% legal interest from the date of
finality of this judgment until full payment. Respondent is further DIRECTED to submit to this court proof of
payment of the amount within 10 days from payment. Let a copy of this resolution be entered in respondent Atty.
Isagani A. Mendoza's personal record with the Office of the Bar Confidant, and a copy be served to the Integrated Bar
of the Philippines and the Office of the Court Administrator for circulation to all the courts in the land.
SO ORDERED.

A.C. No. 9872 January 28, 2014

NATIVIDAD P. NAVARRO and HILDA S. PRESBITERO, Complainants,
vs.
ATTY. IVAN M. SOLIDUM, JR., Respondent.
DECISION
PER CURIAM:
This case originated from a complaint for disbarment, dated 26 May 2008, filed by Natividad P. Navarro (Navarro)
and Hilda S. Presbitero (Presbitero) against Atty. Ivan M. Solidum, Jr. (respondent) before the Integrated Bar of the
Philippines Commission on Bar Discipline (IBP-CBD).
From the Report, dated 1July 2009, of the IBP-CBD, we gathered the following facts of the case:
On 4 April 2006, respondent signed a retainer agreement with Presbitero to follow up the release of the payment for
the latter’s 2.7-hectare property located in Bacolod which was the subject of a Voluntary Offer to Sell (VOS) to the
Department of Agrarian Reform (DAR). The agreement also included the payment of the debts of Presbitero’s late
husband to the Philippine National Bank (PNB), the sale of the retained areas of the property, and the collection of the
rentals due for the retained areas from their occupants. It appeared that the DAR was supposed to pay ₱700,000 for
the property but it was mortgaged by Presbitero and her late husband to PNB for ₱1,200,000. Presbitero alleged that
PNB’s claim had already prescribed, and she engaged the services of respondent to represent her in the matter.
Respondent proposed the filing of a case for quieting of title against PNB. Respondent and Presbitero agreed to an
attorney’s fee of 10% of the proceeds from the VOS or the sale of the property, with the expenses to be advanced by
Presbitero but deductible from respondent’s fees. Respondent received ₱50,000 from Presbitero, supposedly for the
expenses of the case, but nothing came out of it.
In May 2006, Presbitero’s daughter, Ma. Theresa P. Yulo (Yulo), also engaged respondent’s services to handle the
registration of her 18.85-hectare lot located in Nasud-ong, Caradio-an, Himamaylan, Negros. Yulo convinced her
sister, Navarro, to finance the expenses for the registration of the property. Respondent undertook to register the
property in consideration of 30% of the value of the property once it is registered. Respondent obtained ₱200,000
from Navarro for the registration expenses. Navarro later learned that the registration decree over the property was
already issued in the name of one Teodoro Yulo. Navarro alleged that she would not have spent for the registration of
the property if respondent only apprised her of the real situation of the property.
On 25 May 2006, respondent obtained a loan of ₱1,000,000 from Navarro to finance his sugar trading business.
Respondent and Navarro executed a Memorandum of Agreement (MOA) and agreed that the loan (a) shall be for a
period of one year; (b) shall earn interest at the rate of 10% per month; and (c) shall be secured by a real estate
mortgage over a property located in Barangay Alijis, Bacolod City, covered by Transfer Certificate of Title No.
304688. They also agreed that respondent shall issue postdated checks to cover the principal amount of the loan as
well as the interest thereon. Respondent delivered the checks to Navarro, drawn against an account in Metrobank,
Bacolod City Branch, and signed them in the presence of Navarro.
In June 2006, respondent obtained an additional loan of ₱1,000,000 from Navarro, covered by a second MOA with the
same terms and conditions as the first MOA. Respondent sent Navarro, through a messenger, postdated checks drawn
against an account in Bank of Commerce, Bacolod City Branch. Respondent likewise discussed with Navarro about
securing a "Tolling Agreement" with Victorias Milling Company, Inc. but no agreement was signed.
At the same time, respondent obtained a loan of ₱1,000,000 from Presbitero covered by a third MOA, except that the
real estate mortgage was over a 263-square-meter property located in Barangay Taculing, Bacolod City. Respondent
sent Presbitero postdated checks drawn against an account in Metrobank, Bacolod City Branch.
Presbitero was dissatisfied with the value of the 263-square-meter property mortgaged under the third MOA, and
respondent promised to execute a real estate mortgage over a 1,000-square-meter parcel of land adjacent to the 4,000-
square-meter property he mortgaged to Navarro.
However, respondent did not execute a deed for the additional security.
Respondent paid the loan interest for the first few months. He was able to pay complainants a total of ₱900,000.
Thereafter, he failed to pay either the principal amount or the interest thereon. In September 2006, the checks issued
by respondent to complainants could no longer be negotiated because the accounts against which they were drawn
were already closed. When complainants called respondent’s attention, he promised to pay the agreed interest for
September and October 2006 but asked for a reduction of the interest to 7% for the succeeding months.
In November 2006, respondent withdrew as counsel for Yulo. On the other hand, Presbitero terminated the services of
respondent as counsel. Complainants then filed petitions for the judicial foreclosure of the mortgages executed by
respondent in their favor. Respondent countered that the 10% monthly interest on the loan was usurious and illegal.
Complainants also filed cases for estafa and violation of Batas Pambansa Blg. 22 against respondent.
Complainants alleged that respondent induced them to grant him loans by offering very high interest rates. He also
prepared and signed the checks which turned out to be drawn against his son’s accounts. Complainants further alleged
that respondent deceived them regarding the identity and value of the property he mortgaged because he showed them
a different property from that which he owned. Presbitero further alleged that respondent mortgaged his 263-square-
meter property to her for ₱1,000,000 but he later sold it for only ₱150,000.
Respondent, for his defense, alleged that he was engaged in sugar and realty business and that it was Yulo who
convinced Presbitero and Navarro to extend him loans. Yulo also assured him that Presbitero would help him with the
refining of raw sugar through Victorias Milling Company, Inc. Respondent alleged that Navarro fixed the interest rate
and he agreed because he needed the money. He alleged that their business transactions were secured by real estate
mortgages and covered by postdated checks. Respondent denied that the property he mortgaged to Presbitero was less
than the value of the loan. He also denied that he sold the property because the sale was actually rescinded.
Respondent claimed that the property he mortgaged to Navarro was valuable and it was actually worth more than
₱8,000,000.
Respondent alleged that he was able to pay complainants when business was good but he was unable to continue
paying when the price of sugar went down and when the business with Victorias Milling Company, Inc. did not push
through because Presbitero did not help him. Respondent also denied that he was hiding from complainants.
Respondent further alleged that it was Yulo who owed him ₱530,000 as interest due for September to December 2005.
He denied making any false representations. He claimed that complainants were aware that he could no longer open a
current account and they were the ones who proposed that his wife and son issue the checks. Respondent further
alleged that he already started with the titling of Yulo’s lot but his services were terminated before it could be
completed.
A supplemental complaint was filed charging respondent with accepting cases while under suspension. In response,
respondent alleged that he accepted Presbitero’s case in February 2006 and learned of his suspension only in May
2006.
After conducting a hearing and considering the position papers submitted by the parties, the IBP-CBD found that
respondent violated the Code of Professional Responsibility.
The IBP-CBD found that respondent borrowed ₱2,000,000 from Navarro and ₱1,000,000 from Presbitero which he
failed to pay in accordance with the MOAs he executed. The IBP-CBD found that based on the documents presented
by the parties, respondent did not act in good faith in obtaining the loans. The IBP-CBD found that respondent either
promised or agreed to pay the very high interest rates of the loans although he knew them to be exorbitant in
accordance with jurisprudence. Respondent likewise failed to deny that he misled Navarro and her husband regarding
the identity of the property mortgaged to them. Respondent also mortgaged a property to Presbitero for ₱1,000,000
but documents showed that its value was only ₱300,000. Documents also showed that he sold that property for only
₱150,000. Respondent conspired with Yulo to secure loans by promising her a 10% commission and later claimed that
they agreed that Yulo would "ride" on the loan by borrowing ₱300,000 from the amount he obtained from Navarro
and Presbitero. Respondent could not explain how he lost all the money he borrowed in three months except for his
claim that the price of sugar went down.
The IBP-CBD found that respondent misled Navarro and Presbitero regarding the issuance of the postdated checks,
and there was nothing in the records that would show that he informed them that it would be his wife or son who
would issue the checks. The IBP-CBD also found that respondent had not been transparent in liquidating the money
he received in connection with Presbitero’s VOS with DAR. He was also negligent in his accounting regarding the
registration of Yulo’s property which was financed by Navarro.
The IBP-CBD found that respondent was guilty of violating Rule 1.01 of the Code of Professional Responsibility for
committing the following acts:
(1) signing drawn checks against the account of his son as if they were from his own account;
(2) misrepresenting to Navarro the identity of the lot he mortgaged to her;
(3) misrepresenting to Presbitero the true value of the 263-square-meter lot he mortgaged to her;
(4) conspiring with Yulo to obtain the loans from complainants;
(5) agreeing or promising to pay 10% interest on his loans although he knew that it was exorbitant; and
(6) failing to pay his loans because the checks he issued were dishonored as the accounts were already closed.
The IBP-CBD also found that respondent violated Canon 16 and Rule 16.01 of the Code of Professional
Responsibility when he failed to properly account for the various funds he received from complainants.
In addition, the IBP-CBD found that respondent violated Rule 16.04 of the Code of Professional Responsibility which
prohibits borrowing money from a client unless the client’s interest is fully protected or the client is given independent
advice.
On the matter of practicing law while under suspension, the IBP-CBD found that the records were not clear whether
the notice of suspension respondent received on 29 May 2006 was the report and recommendation of the IBP-CBD or
the final decision of this Court. The IBP-CBD likewise found that there was insufficient evidence to prove that
respondent mishandled his cases.
The IBP-CBD recommended that respondent be meted the penalty of disbarment.
In Resolution No. XIX-2011-267 dated 14 May 2011, the IBP Board of Governors adopted and approved the
recommendation of the IBP-CBD with modification by reducing the recommended penalty from disbarment to
suspension from the practice of law for two years. The IBP Board of Governors likewise ordered respondent to return
the amount of his unpaid obligation to complainants.
Complainants filed a motion for reconsideration, praying that the penalty of disbarment be instead imposed upon
respondent.
The only issue in this case is whether respondent violated the Code of Professional Responsibility.
The records show that respondent violated at least four provisions of the Code of Professional Responsibility.
Rule 1.01 of the Code of Professional Responsibility provides:
Rule 1.01. - A lawyer shall not engage in unlawful, dishonest, immoral or deceitful conduct.
With respect to his client, Presbitero, it was established that respondent agreed to pay a high interest rate on the loan
he obtained from her. He drafted the MOA. Yet, when he could no longer pay his loan, he sought to nullify the same
MOA he drafted on the ground that the interest rate was unconscionable. It was also established that respondent
mortgaged a 263-square-meter property to Presbitero for ₱1,000,000 but he later sold the property for only ₱150,000,
showing that he deceived his client as to the real value of the mortgaged property. Respondent’s allegation that the
sale was eventually rescinded did not distract from the fact that he did not apprise Presbitero as to the real value of the
property.
Respondent failed to refute that the checks he issued to his client Presbitero and to Navarro belonged to his son, Ivan
Garcia Solidum III whose name is similar to his name. He only claimed that complainants knew that he could no
longer open a current bank account, and that they even suggested that his wife or son issue the checks for him.
However, we are inclined to agree with the IBP-CBD’s finding that he made complainants believe that the account
belonged to him. In fact, respondent signed in the presence of Navarro the first batch of checks he issued to Navarro.
Respondent sent the second batch of checks to Navarro and the third batch of checks to Presbitero through a
messenger, and complainants believed that the checks belonged to accounts in respondent’s name.
It is clear that respondent violated Rule 1.01 of the Code of Professional Responsibility. We have ruled that conduct,
as used in the Rule, is not confined to the performance of a lawyer’s professional duties. 1 A lawyer may be disciplined
for misconduct committed either in his professional or private capacity. 2 The test is whether his conduct shows him to
be wanting in moral character, honesty, probity, and good demeanor, or whether it renders him unworthy to continue
as an officer of the court.3
In this case, the loan agreements with Navarro were done in respondent’s private capacity. Although Navarro financed
the registration of Yulo’s lot, respondent and Navarro had no lawyer-client relationship. However, respondent was
Presbitero’s counsel at the time she granted him a loan. It was established that respondent misled Presbitero on the
value of the property he mortgaged as a collateral for his loan from her. To appease Presbitero, respondent even made
a Deed of Undertaking that he would give her another 1,000-square-meter lot as additional collateral but he failed to
do so.
Clearly, respondent is guilty of engaging in dishonest and deceitful conduct, both in his professional capacity with
respect to his client, Presbitero, and in his private capacity with respect to complainant Navarro. Both Presbitero and
Navarro allowed respondent to draft the terms of the loan agreements. Respondent drafted the MOAs knowing that the
interest rates were exorbitant. Later, using his knowledge of the law, he assailed the validity of the same MOAs he
prepared. He issued checks that were drawn from his son’s account whose name was similar to his without informing
complainants. Further, there is nothing in the records that will show that respondent paid or undertook to pay the loans
he obtained from complainants.
Canon 16 and Rule 16.01 of the Code of Professional Responsibility provide:
CANON 16. - A LAWYER SHALL HOLD IN TRUST ALL MONEYS AND PROPERTIES OF HIS CLIENT THAT
MAY COME INTO HIS POSSESSION.
Rule 16.01 – A lawyer shall account for all money or property collected or received for or from the client.
The fiduciary nature of the relationship between the counsel and his client imposes on the lawyer the duty to account
for the money or property collected or received for or from his client. 4 We agree with the IBP-CBD that respondent
failed to fulfill this duty. In this case, the IBP-CBD pointed out that respondent received various amounts from
complainants but he could not account for all of them.
Navarro, who financed the registration of Yulo’s 18.85-hectare lot, claimed that respondent received ₱265,000 from
her. Respondent countered that ₱105,000 was paid for real estate taxes but he could not present any receipt to prove
his claim. Respondent also claimed that he paid ₱70,000 to the surveyor but the receipt was only for ₱15,000.
Respondent claimed that he paid ₱50,000 for filing fee, publication fee, and other expenses but again, he could not
substantiate his claims with any receipt. As pointed out by the IBP-CBD, respondent had been less than diligent in
accounting for the funds he received from Navarro for the registration of Yulo’s property.
Unfortunately, the records are not clear whether respondent rendered an accounting to Yulo who had since passed
away.
As regards Presbitero, it was established during the clarificatory hearing that respondent received ₱50,000 from
Presbitero. As the IBP-CBD pointed out, the records do not show how respondent spent the funds because he was not
transparent in liquidating the money he received from Presbitero.
Clearly, respondent had been negligent in properly accounting for the money he received from his client,
Presbitero. Indeed, his failure to return the excess money in his possession gives rise to the presumption that he has
1âwphi1

misappropriated it for his own use to the prejudice of, and in violation of the trust reposed in him by, the client. 5
Rule 16.04 of the Code of Professional Responsibility provides:
Rule 16.04. - A lawyer shall not borrow money from his client unless the client’s interests are fully protected by the
nature of the case or by independent advice. Neither shall a lawyer lend money to a client except, when in the interest
of justice, he has to advance necessary expenses in a legal matter he is handling for the client.
Here, respondent does not deny that he borrowed ₱1,000,000 from his client Presbitero. At the time he secured the
loan, respondent was already the retained counsel of Presbitero.
While respondent’s loan from Presbitero was secured by a MOA, postdated checks and real estate mortgage, it turned
out that respondent misrepresented the value of the property he mortgaged and that the checks he issued were not
drawn from his account but from that of his son. Respondent eventually questioned the terms of the MOA that he
himself prepared on the ground that the interest rate imposed on his loan was unconscionable. Finally, the checks
issued by respondent to Presbitero were dishonored because the accounts were already closed. The interest of his
client, Presbitero, as lender in this case, was not fully protected. Respondent violated Rule 16.04 of the Code of
Professional Responsibility, which presumes that the client is disadvantaged by the lawyer’s ability to use all the legal
maneuverings to renege on his obligation. 6 In his dealings with his client Presbitero, respondent took advantage of his
knowledge of the law as well as the trust and confidence reposed in him by his client.
We modify the recommendation of the IBP Board of Governors imposing on respondent the penalty of suspension
from the practice of law for two years. Given the facts of the case, we see no reason to deviate from the
recommendation of the IBP-CBD imposing on respondent the penalty of disbarment. Respondent failed to live up to
the high standard of morality, honesty, integrity, and fair dealing required of him as a member of the legal
profession.7 Instead, respondent employed his knowledge and skill of the law and took advantage of his client to
secure undue gains for himself8 that warrants his removal from the practice of law. Likewise, we cannot sustain the
IBP Board of Governors’ recommendation ordering respondent to return his unpaid obligation to complainants, except
for advances for the expenses he received from his client, Presbitero, that were not accounted at all. In disciplinary
proceedings against lawyers, the only issue is whether the officer of the court is still fit to be allowed to continue as a
member of the Bar.9 Our only concern is the determination of respondent’s administrative liability. 10
Our findings have no material bearing on other judicial action which the parties may choose to file against each
other.11 Nevertheless, when a lawyer receives money from a client for a particular purpose involving the client-
attorney relationship, he is bound to render an accounting to the client showing that the money was spent for that
particular purpose.12 If the lawyer does not use the money for the intended purpose, he must immediately return the
money to his client.13 Respondent was given an opportunity to render an accounting, and he failed. He must return the
full amount of the advances given him by Presbitero, amounting to ₱50,000.
WHEREFORE, the Court finds Atty. Ivan M. Solidum, Jr. GUILTY of violating Rule 1.01, Canon 16, Rule 16.01, and
Rule 16.04 of the Code of Professional Responsibility. Accordingly, the Court DISBARS him from the practice of law
effective immediately upon his receipt of this Decision.
Atty. Solidum is ORDERED to return the advances he received from Hilda S. Presbitero, amounting to ₱50,000, and
to submit to the Office of the Bar Confidant his compliance with this order within thirty days from finality of this
Decision.
Let copies of this Decision be furnished the Office of the Bar Confidant, the Integrated Bar of the Philippines for
distribution to all its chapters, and the Office of the Court Administrator for dissemination to all courts all over the
country. Let a copy of this Decision be attached to the personal records of respondent.
SO ORDERED.

A.C. No. 10579, December 10, 2014

ERLINDA FOSTER, Complainant, v. ATTY. JAIME V. AGTANG, Respondent.
DECISION
PER CURIAM:
1
This refers to the Resolution of the Board of Governors (BOG), Integrated Bar of the Philippines (IBP), dated
March 23, 2014, affirming with modification the findings of the Investigating Commissioner, who recommended the
suspension of respondent Atty. Jaime V. Agtang (respondent) from the practice of law for one (1) year for ethical
impropriety and ordered the payment of his unpaid obligations to complainant.

2
From the records, it appears that the IBP, thru its Commission on Bar Discipline (CBD), received a complaint ,
dated May 31, 2011, filed by Erlinda Foster (complainant) against respondent for “unlawful, dishonest, immoral and
3
deceitful” acts as a lawyer.

4
In its July 1, 2011 Order, the IBP-CBD directed respondent to file his Answer within 15 days from receipt of the
order. Respondent failed to do so and complainant sent a query as to the status of her complaint. On October 10,
5
2011, the Investigating Commissioner issued the Order setting the case for mandatory conference/hearing on
November 16, 2011. It was only on November 11, 2011, or five (5) days before the scheduled conference when
6
respondent filed his verified Answer.
During the conference, only the complainant together with her husband appeared. She submitted a set of
documents contained in a folder, copies of which were furnished the respondent. The Investigating
7
Commissioner indicated that the said documents would be reviewed and the parties would be informed if there
was a need for clarificatory questioning; otherwise, the case would be submitted for resolution based on the
8
documents on file. The Minutes of the mandatory conference showed that respondent arrived at 11:10 o’clock in
the morning or after the proceeding was terminated.

On December 12, 2011, the complainant filed her Reply to respondent’s Answer.

9
On April 18, 2012, complainant submitted copies of the January 24, 2012 Decisions of the Municipal Trial Court in
Small Claims Case Nos. 2011-0077 and 2011-0079, ordering respondent [defendant therein] to pay complainant
and her husband the sum of P100,000.00 and P22,000.00, respectively, with interest at the rate of 12% per annum
10
from December 8, 2011 until fully paid, plus cost of suit.

Complainant’s Position

From the records, it appears that complainant was referred to respondent in connection with her legal problem
regarding a deed of absolute sale she entered into with Tierra Realty, which respondent had notarized. After their
discussion, complainant agreed to engage his legal services for the filing of the appropriate case in court, for which
they signed a contract. Complainant paid respondent P20,000.00 as acceptance fee and P5,000.00 for incidental
11
expenses.

12
On September 28, 2009, respondent wrote a letter to Tropical Villas Subdivision in relation to the legal problem
referred by complainant. He then visited the latter in her home and asked for a loan of P100,000.00, payable in
sixty (60) days, for the repair of his car. Complainant, having trust and confidence on respondent being her lawyer,
13
agreed to lend the amount without interest. A promissory note evidenced the loan.

In November 2009, complainant became aware that Tierra Realty was attempting to transfer to its name a lot she
had previously purchased. She referred the matter to respondent who recommended the immediate filing of a case
for reformation of contract with damages. On November 8, 2009, respondent requested and thereafter received
14
from complainant the amount of P150,000.00, as filing fee. When asked about the exorbitant amount,
respondent cited the high value of the land and the sheriffs’ travel expenses and accommodations in Manila, for the
service of the summons to the defendant corporation. Later, complainant confirmed that the fees paid for the filing
of Civil Case No. 14791-65, entitled Erlinda Foster v. Tierra Realty and Development Corporation, only amounted to
15
P22,410.00 per trial court records.

During a conversation with the Registrar of Deeds, complainant also discovered that respondent was the one who
notarized the document being questioned in the civil case she filed. When asked about this, respondent merely
replied that he would take a collaborating counsel to handle complainant’s case. Upon reading a copy of the
complaint filed by respondent with the trial court, complainant noticed that: 1] the major differences in the
documents issued by Tierra Realty were not alleged; 2] the contract to buy and sell and the deed of conditional sale
were not attached thereto; 3] the complaint discussed the method of payment which was not the point of
contention in the case; and 4] the very anomalies she complained of were not mentioned. Respondent, however,
assured her that those matters could be brought up during the hearings.

On April 23, 2010, respondent wrote to complainant, requesting that the latter extend to him the amount of
16
P70,000.00 or P50,000.00 “in the moment of urgency or emergency.” Complainant obliged the request and gave
respondent the sum of P22,000.00.

On August 31, 2010, respondent came to complainant’s house and demanded the sum of P50,000.00, purportedly
to be given to the judge in exchange for a favorable ruling. Complainant expressed her misgivings on this
17
proposition but she eventually gave the amount of P25,000.00 which was covered by a receipt, stating that “it is
understood that the balance of P25,000.00 shall be paid later after favorable judgment for plaintiff Erlinda Foster.”
On November 2, 2010, respondent insisted that the remaining amount be given by complainant prior to the next
hearing of the case, because the judge was allegedly asking for the balance. Yet again, complainant handed to
18
respondent the amount of P25,000.00.

On September 29, 2010, complainant’s case was dismissed. Not having been notified by respondent, complainant
learned of the dismissal on December 14, 2010, when she personally checked the status of the case with the court.
She went to the office of respondent, but he was not there. Instead, one of the office staff gave her a copy of the
order of dismissal.

On December 15, 2010, respondent visited complainant and gave her a copy of the motion for reconsideration. On
January 15, 2011, complainant went to see respondent and requested him to prepare a reply to the comment filed
by Tierra Realty on the motion for reconsideration; to include additional facts because the Land Registration
Authority would not accept the documents unless these were amended; and to make the additional averment that
the defendant was using false documents.

On January 18, 2011, respondent’s driver delivered to complainant a copy of the reply with a message from him
that the matters she requested to be included were mentioned therein. Upon reading the same, however,
complainant discovered that these matters were not so included. On the same occasion, the driver also asked for
P2,500.00 on respondent’s directive for the reimbursement of the value of a bottle of wine given to the judge as a
19
present. Complainant was also told that oral arguments on the case had been set the following month.

On February 2, 2011, complainant decided to terminate the services of respondent as her counsel and wrote him a
20
letter of termination, after her friend gave her copies of documents showing that respondent had been
acquainted with Tierra Realty since December 2007. Subsequently, complainant wrote to respondent, requesting
him to pay her the amounts he received from her less the contract fee and the actual cost of the filing fees.
Respondent never replied.

Respondent’s Position

21
In his Answer, respondent alleged that he was 72 years old and had been engaged in the practice of law since
March 1972, and was President of the IBP Ilocos Norte Chapter from 1998 to 1999. He admitted the fact that he
notarized the Deed of Absolute Sale subject of complainant’s case, but he qualified that he was not paid his notarial
fees therefor. He likewise admitted acting as counsel for complainant for which he claimed to have received
P10,000.00 as acceptance fee and P5,000.00 for incidental fees. Anent the loan of P100,000.00, respondent
averred that it was complainant, at the behest of her husband, who willingly offered the amount to him for his
patience in visiting them at home and for his services. The transaction was declared as “no loan” and he was told
not to worry about its payment. As regards the amount of P150,000.00 he received for filing fees, respondent
claimed that the said amount was suggested by the complainant herself who was persistent in covering the
incidental expenses in the handling of the case. He denied having said that the sheriffs of the court would need the
money for their hotel accommodations. Complainant’s husband approved of the amount. In the same vein,
respondent denied having asked for a loan of P50,000.00 and having received P22,000.00 from complainant. He
also denied having told her that the case would be discussed with the judge who would rule in their favor at the
very next hearing. Instead, it was complainant who was bothered by the possibility that the other party would
befriend the judge. He never said that he would personally present a bottle of wine to the judge.

Further, respondent belied the Registrar’s comment as to his representation of Tierra Realty in the past.
Respondent saw nothing wrong in this situation since complainant was fully aware that another counsel was
assisting him in the handling of cases. Having been fully informed of the nature of her cause of action and the
consequences of the suit, complainant was aware of the applicable law on reformation of contracts. Finally, by way
of counterclaim, respondent demanded just compensation for the services he had rendered in other cases for the
complainant.

Reply of Complainant

22
In her Reply, complainant mainly countered respondent’s defenses by making reference to the receipts in her
possession, all evidencing that respondent accepted the amounts mentioned in the complaint. Complainant also
emphasized that respondent and Tierra Realty had relations long before she met him. While respondent was
employed as Provincial Legal Officer of the Provincial Government of Ilocos Norte, he was involved in the
preparation of several documents involving Flying V, an oil company owned by Ernest Villavicencio, who likewise
owned Tierra Realty. Complainant insisted that the amount of P100,000.00 she extended to respondent was never
considered as “no loan.”

On June 26, 2012, complainant furnished the Investigating Commissioner copies of the Resolution, dated June 20,
2012, issued by the Office of the City Prosecutor of Laoag City, finding probable cause against respondent for
23
estafa.

Findings and Recommendation of the IBP

24
In its July 3, 2012 Report and Recommendation, the Investigating Commissioner found respondent guilty of
ethical impropriety and recommended his suspension from the practice of law for one (1) year.

In its September 28, 2013 Resolution, the IBP-BOG adopted and approved with modification the recommendation
of suspension by the Investigating Commissioner and ordered respondent to return to complainant: 1) his loan of
P122,000.00; and 2) the balance of the filing fee amounting to P127,590.00.

Respondent received a copy of the said resolution on January 16, 2014 to which he filed a motion for
25
reconsideration. Complainant filed her opposition thereto, informing the IBP-BOG that an information charging
respondent for estafa had already been filed in court and that a corresponding order for his arrest had been
26
issued.

In its March 23, 2014 Resolution, the IBP-BOG denied respondent’s motion for reconsideration but modified the
penalty of his suspension from the practice of law by reducing it from one (1) year to three (3) months.
Respondent was likewise ordered to return the balance of the filing fee received from complainant amounting to
P127,590.00.

No petition for review was filed with the Court.

The only issue in this case is whether respondent violated the Code of Professional Responsibility (CPR).
The Court’s Ruling

The Court sustains the findings and recommendation of the Investigating Commissioner with respect to
respondent’s violation of Rules 1 and 16 of the CPR. The Court, however, modifies the conclusion on his alleged
violation of Rule 15, on representing conflicting interests. The Court also differs on the penalty.

Rule 1.0, Canon 1 of the CPR, provides that “[a] lawyer shall not engage in unlawful, dishonest, immoral or
deceitful conduct.” It is well-established that a lawyer’s conduct is “not confined to the performance of his
professional duties. A lawyer may be disciplined for misconduct committed either in his professional or private
capacity. The test is whether his conduct shows him to be wanting in moral character, honesty, probity, and good
27
demeanor, or whether it renders him unworthy to continue as an officer of the court.”

In this case, respondent is guilty of engaging in dishonest and deceitful conduct, both in his professional and
private capacity. As a lawyer, he clearly misled complainant into believing that the filing fees for her case were
worth more than the prescribed amount in the rules, due to feigned reasons such as the high value of the land
involved and the extra expenses to be incurred by court employees. In other words, he resorted to overpricing, an
act customarily related to depravity and dishonesty. He demanded the amount of P150,000.00 as filing fee, when
in truth, the same amounted only to P22,410.00. His defense that it was complainant who suggested that amount
deserves no iota of credence. For one, it is highly improbable that complainant, who was then plagued with the
rigors of litigation, would propose such amount that would further burden her financial resources. Assuming that
the complainant was more than willing to shell out an exorbitant amount just to initiate her complaint with the trial
court, still, respondent should not have accepted the excessive amount. As a lawyer, he is not only expected to be
knowledgeable in the matter of filing fees, but he is likewise duty-bound to disclose to his client the actual amount
due, consistent with the values of honesty and good faith expected of all members of the legal profession.

Moreover, the “fiduciary nature of the relationship between the counsel and his client imposes on the lawyer the
28
duty to account for the money or property collected or received for or from his client.” Money entrusted to a
lawyer for a specific purpose but not used for the purpose should be immediately returned. A lawyer’s failure to
return upon demand the funds held by him on behalf of his client gives rise to the presumption that he has
appropriated the same for his own use in violation of the trust reposed in him by his client. Such act is a gross
violation of general morality as well as of professional ethics. It impairs public confidence in the legal profession
29
and deserves punishment.

It is clear that respondent failed to fulfill this duty. As pointed out, he received various amounts from complainant
but he could not account for all of them. Worse, he could not deny the authenticity of the receipts presented by
complainant. Upon demand, he failed to return the excess money from the alleged filing fees and other expenses.
His possession gives rise to the presumption that he has misappropriated it for his own use to the prejudice of, and
30
in violation of the trust reposed in him by, the client. When a lawyer receives money from the client for a
particular purpose, the lawyer is bound to render an accounting to the client showing that the money was spent for
the intended purpose. Consequently, if the lawyer does not use the money for the intended purpose, the lawyer
31
must immediately return the money to the client.
Somewhat showing a propensity to demand excessive and unwarranted amounts from his client, respondent
displayed a reprehensible conduct when he asked for the amount of P50,000.00 as “representation expenses”
allegedly for the benefit of the judge handling the case, in exchange for a favorable decision. Respondent himself
signed a receipt showing that he initially took the amount of P 25,000.00 and, worse, he subsequently demanded
and received the other half of the amount at the time the case had already been dismissed. Undoubtedly, this act is
tantamount to gross misconduct that necessarily warrants the supreme penalty of disbarment. The act of
demanding a sum of money from his client, purportedly to be used as a bribe to ensure a positive outcome of a
case, is not only an abuse of his client’s trust but an overt act of undermining the trust and faith of the public in the
legal profession and the entire Judiciary. This is the height of indecency. As officers of the court, lawyers owe their
utmost fidelity to public service and the administration of justice. In no way should a lawyer indulge in any act that
would damage the image of judges, lest the public’s perception of the dispensation of justice be overshadowed by
iniquitous doubts. The denial of respondent and his claim that the amount was given gratuitously would not excuse
him from any liability. The absence of proof that the said amount was indeed used as a bribe is of no moment. To
tolerate respondent’s actuations would seriously erode the public’s trust in the courts.

As it turned out, complainant’s case was dismissed as early as September 29, 2010. At this juncture, respondent
proved himself to be negligent in his duty as he failed to inform his client of the status of the case, and left the
client to personally inquire with the court. Surely, respondent was not only guilty of misconduct but was also remiss
in his duty to his client.

Respondent’s unbecoming conduct towards complainant did not stop here. Records reveal that he likewise violated
Rule 16.04, Canon 16 of the CPR, which states that “[a] lawyer shall not borrow money from his client unless the
client’s interests are fully protected by the nature of the case or by independent advice. Neither shall a lawyer lend
money to a client except, when in the interest of justice, he has to advance necessary expenses in a legal matter
he is handling for the client.” In his private capacity, he requested from his client, not just one, but two loans of
considerable amounts. The first time, he visited his client in her home and borrowed P100,000.00 for the repair of
his car; and the next time, he implored her to extend to him a loan of P70,000.00 or P50,000.00 “in the moment of
urgency or emergency” but was only given P22,000.00 by complainant. These transactions were evidenced by
promissory notes and receipts, the authenticity of which was never questioned by respondent. These acts were
committed by respondent in his private capacity, seemingly unrelated to his relationship with complainant, but
were indubitably acquiesced to by complainant because of the trust and confidence reposed in him as a lawyer.
Nowhere in the records, particularly in the defenses raised by respondent, was it implied that these loans fell within
the exceptions provided by the rules. The loans of P100,000.00 and P22,000.00 were surely not protected by the
nature of the case or by independent advice. Respondent’s assertion that the amounts were given to him out of the
liberality of complainant and were, thus, considered as “no loan,” does not justify his inappropriate behavior. The
acts of requesting and receiving money as loans from his client and thereafter failing to pay the same are indicative
of his lack of integrity and sense of fair dealing. Up to the present, respondent has not yet paid his obligations to
complainant.

Time and again, the Court has consistently held that deliberate failure to pay just debts constitutes gross
misconduct, for which a lawyer may be sanctioned with suspension from the practice of law. Lawyers are
instruments for the administration of justice and vanguards of our legal system. They are expected to maintain not
only legal proficiency, but also a high standard of morality, honesty, integrity and fair dealing so that the people’s
faith and confidence in the judicial system is ensured. They must, at all times, faithfully perform their duties to
32
society, to the bar, the courts and their clients, which include prompt payment of financial obligations.

Verily, when the Code or the Rules speaks of “conduct” or “misconduct,” the reference is not confined to one’s
behavior exhibited in connection with the performance of the lawyer’s professional duties, but also covers any
misconduct which, albeit unrelated to the actual practice of his profession, would show him to be unfit for the office
and unworthy of the privileges which his license and the law vest him with. Unfortunately, respondent must be
found guilty of misconduct on both scores.

With respect to respondent’s alleged representation of conflicting interests, the Court finds it proper to modify the
findings of the Investigating Commissioner who concluded that complainant presented insufficient evidence of
respondent’s “lawyering” for the opposing party, Tierra Realty.

Rule 15.03, Canon 15 of the CPR, provides that “[a] lawyer shall not represent conflicting interest except by written
consent of all concerned given after a full disclosure of the facts.” The relationship between a lawyer and his/her
client should ideally be imbued with the highest level of trust and confidence. This is the standard of confidentiality
that must prevail to promote a full disclosure of the client’s most confidential information to his/her lawyer for an
unhampered exchange of information between them. Needless to state, a client can only entrust confidential
information to his/her lawyer based on an expectation from the lawyer of utmost secrecy and discretion; the
lawyer, for his part, is duty-bound to observe candor, fairness and loyalty in all dealings and transactions with the
33
client. Part of the lawyer’s duty in this regard is to avoid representing conflicting interests.” Thus, even if
lucrative fees offered by prospective clients are at stake, a lawyer must decline professional employment if the
same would trigger the violation of the prohibition against conflict of interest. The only exception provided in the
rules is a written consent from all the parties after full disclosure.

The Court deviates from the findings of the IBP. There is substantial evidence to hold respondent liable for
representing conflicting interests in handling the case of complainant against Tierra Realty, a corporation to which
he had rendered services in the past. The Court cannot ignore the fact that respondent admitted to having
notarized the deed of sale, which was the very document being questioned in complainant’s case. While the
Investigating Commissioner found that the complaint in Civil Case No. 14791-65 did not question the validity of the
said contract, and that only the intentions of the parties as to some provisions thereof were challenged, the Court
still finds that the purpose for which the proscription was made exists. The Court cannot brush aside the dissatisfied
observations of the complainant as to the allegations lacking in the complaint against Tierra Realty and the clear
admission of respondent that he was the one who notarized the assailed document. Regardless of whether it was
the validity of the entire document or the intention of the parties as to some of its provisions raised, respondent fell
short of prudence in action when he accepted complainant’s case, knowing fully that he was involved in the
execution of the very transaction under question. Neither his unpaid notarial fees nor the participation of a
collaborating counsel would excuse him from such indiscretion. It is apparent that respondent was retained by
clients who had close dealings with each other. More significantly, there is no record of any written consent from
any of the parties involved.

The representation of conflicting interests is prohibited “not only because the relation of attorney and client is one
of trust and confidence of the highest degree, but also because of the principles of public policy and good taste. An
attorney has the duty to deserve the fullest confidence of his client and represent him with undivided loyalty. Once
34
this confidence is abused or violated the entire profession suffers.”

Penalties and Pecuniary Liabilities

A member of the Bar may be penalized, even disbarred or suspended from his office as an attorney, for violation of
35
the lawyer’s oath and/or for breach of the ethics of the legal profession as embodied in the CPR. For the practice
of law is “a profession, a form of public trust, the performance of which is entrusted to those who are qualified and
36
who possess good moral character.” The appropriate penalty for an errant lawyer depends on the exercise of
37
sound judicial discretion based on the surrounding facts.

Under Section 27, Rule 138 of the Revised Rules of Court, a member of the Bar may be disbarred or suspended on
any of the following grounds: (1) deceit; (2) malpractice or other gross misconduct in office; (3) grossly immoral
conduct; (4) conviction of a crime involving moral turpitude; (5) violation of the lawyer's oath; (6) willful
disobedience of any lawful order of a superior court; and (7) willful appearance as an attorney for a party without
authority. A lawyer may be disbarred or suspended for misconduct, whether in his professional or private capacity,
which shows him to be wanting in moral character, honesty, probity and good demeanor, or unworthy to continue
as an officer of the court.

Here, respondent demonstrated not just a negligent disregard of his duties as a lawyer but a wanton betrayal of the
trust of his client and, in general, the public. Accordingly, the Court finds that the suspension for three (3) months
recommended by the IBP-BOG is not sufficient punishment for the unacceptable acts and omissions of respondent.
The acts of the respondent constitute malpractice and gross misconduct in his office as attorney. His incompetence
and appalling indifference to his duty to his client, the courts and society render him unfit to continue discharging
the trust reposed in him as a member of the Bar.

For taking advantage of the unfortunate situation of the complainant, for engaging in dishonest and deceitful
conduct, for maligning the judge and the Judiciary, for undermining the trust and faith of the public in the legal
profession and the entire judiciary, and for representing conflicting interests, respondent deserves no less than the
38
penalty of disbarment.

Notably, the Court cannot order respondent to return the money he borrowed from complainant in his private
39
capacity. In Tria-Samonte v. Obias, the Court held that it cannot order the lawyer to return money to
complainant if he or she acted in a private capacity because its findings in administrative cases have no bearing on
liabilities which have no intrinsic link to the lawyer’s professional engagement. In disciplinary proceedings against
lawyers, the only issue is whether the officer of the court is still fit to be allowed to continue as a member of the
Bar. The only concern of the Court is the determination of respondent’s administrative liability. Its findings have no
material bearing on other judicial actions which the parties may choose against each other.

To rule otherwise would in effect deprive respondent of his right to appeal since administrative cases are filed
directly with the Court. Furthermore, the quantum of evidence required in civil cases is different from the quantum
of evidence required in administrative cases. In civil cases, preponderance of evidence is required. Preponderance
of evidence is “a phrase which, in the last analysis, means probability of the truth. It is evidence which is more
40
convincing to the court as worthier of belief than that which is offered in opposition thereto.” In administrative
cases, only substantial evidence is needed. Substantial evidence, which is more than a mere scintilla but is such
relevant evidence as a reasonable mind might accept as adequate to support a conclusion, would suffice to hold
41
one administratively liable. Furthermore, the Court has to consider the prescriptive period applicable to civil cases
42
in contrast to administrative cases which are, as a rule, imprescriptible.

Thus, the IBP-BOG was correct in ordering respondent to return the amount of P127,590.00 representing the
balance of the filing fees he received from complainant, as this was intimately related to the lawyer-client
relationship between them. Similar to this is the amount of P50,000.00 which respondent received from
complainant, as representation expenses for the handling of the civil case and for the purported purchase of a
bottle of wine for the judge. These were connected to his professional relationship with the complainant. While
respondent’s deplorable act of requesting the said amount for the benefit of the judge is stained with mendacity,
respondent should be ordered to return the same as it was borne out of their professional relationship. As to his
other obligations, respondent was already adjudged as liable for the personal loans he contracted with complainant,
per the small claims cases filed against him.

All told, in the exercise of its disciplinary powers, “the Court merely calls upon a member of the Bar to account for
43
his actuations as an officer of the Court with the end in view of preserving the purity of the legal profession.” The
Court likewise aims to ensure the proper and honest administration of justice by “purging the profession of
members who, by their misconduct, have proven themselves no longer worthy to be entrusted with the duties and
44
responsibilities of an attorney.”

WHEREFORE, finding the respondent, Atty. Jaime V. Agtang, GUILTY of gross misconduct in violation of the Code of
Professional Responsibility, the Court hereby DISBARS him from the practice of law and ORDERS him to pay the
complainant, Erlinda Foster, the amounts of P127,590.00, P50,000.00 and P2,500.00.

Let a copy of this Decision be sent to the Office of the Bar Confidant, the Integrated Bar of the Philippines and the
Office of the Court Administrator to be circulated to all courts.

SO ORDERED.

G.R. No. 194122 October 11, 2012

HECTOR HERNANDEZ, Petitioner,
vs.
SUSAN SAN PEDRO AGONCILLO, Respondent.
DECISION
PERALTA, J.:
Assailed in the present petition for review on certiorari under Rule 45 of the Rules of Court are the April 29, 2010
Decision1 and October 12, 2010 Resolution2 of the Court of Appeals (CA) in CA-G.R. SP No. 108801.
The instant petition arose from a Complaint for Damages filed with the Metropolitan Trial Court (MeTC) of
Parafiaque City against herein petitioner and one Freddie Apawan Verwin by herein respondent, alleging as follows:
xxxx
2. x x x Defendant Hector Hernandez is x x x the owner of the delivery van which is the subject matter of the
above-entitled case. He is doing business under the name of Cargo Solution Innovation and is the employer of
Defendant Fredie Apawan Verwin;
3. That on October 5, 2006 at around 12:15 in the afternoon, Defendant Fredie Apawan Verwin was driving a
delivery van belonging to a certain Hector Hernandez, bearing plate number RBB-510, along Buendia Avenue
Flyover, South Super-Highway (Osmeña Avenue), and negligently backed against a Honda City model with
plate number XMF-496, owned and driven by the Plaintiff at the time of the incident;
 4. That at the time of the incident, the traffic condition at the Buendia Avenue Flyover was bumper-to-bumper
and that Plaintiff's and Defendant's vehicles were in an ascending position;
5. That Defendant driver alighted from his van and so did the Plaintiff to assess the damage done. Plaintiff
observed that the pedestal of the van totally engaged and hooked the front bumper of her Honda car;
6. That after a brief discussion of the incident, Defendant driver went back to his van and stepped on the gas
which caused the van to move abruptly forward and resulted to the disengagement of the bumper of Plaintiff's
car and damage to the car radiator, and as a consequence, the Plaintiff's car was towed. Plaintiff paid P1,700
as towing fee. x x x
7. Right after the incident, Plaintiff made various demands from Defendants, thru the secretary of the Cargo
Solution Innovation or C.S.I., the company which the driver of the van was working for, to pay the actual
damages sustained, but to Plaintiff's dismay her demands were unheeded;
8. That defendant Hector Hernandez never talked nor appeared to the Plaintiff despite several requests made
by the latter. Instead, he made a person appear having the name of Mr. De Ocampo before the Plaintiff in her
clinic at Medical Center Manila, sometime on October 11, 2006 and acted in representation of Hector
Hernandez and made a number of inquiries regarding the accident that transpired;
9. That sometime after, Plaintiff contacted Mr. De Ocampo for feedback regarding Defendant's position about
the incident, and Mr. De Ocampo spoke that the Defendants are still waiting for the police report and ever
since that conversation, no communication transpired between the parties regarding any agreement or
settlement about the accident;
10. That as a direct consequence of the foregoing, Plaintiff's vehicle sustained heavy damage and the repair of
which amounted to P130,602.53. A copy of the official receipt given by Honda Makati is hereby attached as
Annex "D";
11. Plaintiff was unable to use her vehicle in going to work for five (5) weeks and led her to commute by
means of a taxi every time her duty called her in Medical Center Manila in United Nations Avenue, Manila
costing her P500-1000/day;
12. Considering the character of Defendant driver's negligence, together with the malicious refusal to pay
actual damages of both Defendants and Plaintiff's experience of sleepless nights and anxiety because of the
incident, Defendants should be held liable for moral damages in an amount of not less than P50,000.00;
13. Forced to litigate, Plaintiff engaged the services of a lawyer and have agreed to pay attorney's fees in the
amount of P30,000.00 plus P2,500.00 per appearance.3
On May 31, 2007, the MeTC issued a Summons Under Summary Procedure 4 which was served upon and received by
petitioner on June 18, 2007. However, the summons was not served on the other defendant. The case then proceeded
only against petitioner.
On July 6, 2007, petitioner filed an Ex Parte Motion for Extension of Time to File His Answer claiming that he just
engaged the services of his counsel. He prayed that he be granted an additional period of fifteen (15) days or until July
21, 2007 within which to file his responsive pleading.5
On July 18, 2007, the MeTC issued an Order 6 denying petitioner's Ex Parte Motion for Extension of Time holding that
the said Motion was filed beyond the reglementary period provided for by the Revised Rules on Summary Procedure
and that it is likewise a prohibited pleading under the said Rule.
Petitioner filed a Motion for Reconsideration 7 on August 17, 2007. Meanwhile, petitioner, nonetheless, filed his
Answer with Affirmative and Negative Defenses and Compulsory Counterclaims 8 on July 26, 2007.
Respondent opposed petitioner's Motion for Reconsideration.9 In the meantime, she filed a Motion to Render
Judgment10 on August 24, 2007, on the ground that petitioner failed to file his answer within the time prescribed by
the Revised Rules on Summary Procedure.
On September 7, 2007, the MeTC issued an Order 11 ruling that in view of the fact that the amount being claimed by
respondent exceeds P200,000.00, the case shall be governed by the "Rules on Regular Procedure." In the same Order,
the MeTC denied petitioner's Motion for Reconsideration and directed him to file his Comment/Opposition to
respondent's Motion to Render Judgment.
Petitioner filed his Opposition12 on September 14, 2007.
On October 23, 2007, the MeTC issued an Order 13 denying respondent's Motion to Render Judgment reiterating its
ruling that the case does not fall under the Revised Rules on Summary Procedure.
On November 14, 2007, respondent filed a Motion to Declare Defendant (herein petitioner) Hector Hernandez in
Default and to Render Judgment.14
Petitioner opposed contending that he has already filed his Answer prior to respondent's Motion to declare him in
default and that he had actively participated in the case by filing various pleadings.15
On December 4, 2007, the MeTC issued an Order 16 declaring petitioner in default and directing respondent to present
evidence ex parte.
Petitioner filed a Motion to Set Aside Order of Default,17 but the MeTC denied it in its Order18 dated February 8, 2008.
After respondent's evidence ex parte was presented, the MeTC rendered its Decision 19 dated August 6, 2008, the
dispositive portion of which reads as follows:
WHEREFORE, judgment is hereby rendered in favor of the plaintiff Susan San Pedro Agoncillo and against the
defendant Hector Hernandez, ordering him,
a) To pay the plaintiff the amount of One Hundred Thirty-Two Thousand Three Hundred Two Pesos and
53/100 (Php 132,302.53) for the actual damages for the repair of the car and the towing fee;
b) Attorney's fees in the amount of Ten Thousand Pesos (Php 10,000.00)
c) And costs.
The case as against defendant Fredie Apawan Verwin is dismissed without prejudice as summons was not validly
served upon him.
SO ORDERED.20
The MeTC held that respondent was able to sufficiently establish her cause of action against petitioner in accordance
with the provisions of Article 2180 of the Civil Code.
Petitioner appealed to the RTC which, however, denied the same in its Decision dated February 18, 2009. The RTC
affirmed the findings and conclusions of the MeTC. As to the procedural aspect, the RTC ruled that the MeTC
correctly denied due course to petitioner's Answer as the Motion for Extension to file the same was filed out of time
and that the said Answer was, in fact, filed beyond the extended period requested in the Motion for Extension.
Petitioner then filed a petition for review with the CA. On April 29, 2010, the CA rendered its assailed Decision
denying the petition for lack of merit. Petitioner filed a Motion for Reconsideration, but the CA denied it in its
Resolution dated October 12, 2010.
Hence, the instant petition for review on certiorari raising a sole issue, to wit:
WHETHER OR NOT THE HONORABLE COURT OF APPEALS DECISION IS IN ACCORD WITH
APPLICABLE DECISIONS OF THE HONORABLE SUPREME COURT, SPECIFICALLY THE HONORABLE
SUPREME COURT'S RULING IN SABLAS vs. SABLAS (526 SCRA 292 2007).21
Petitioner's basic contention is that, pursuant to this Court's ruling in Sablas v. Sablas, 22 the MeTC should have
admitted his Answer as his pleading was filed before he was declared in default.
The petition is without merit.
It is true that this Court held in Sablas that where the Answer is filed beyond the reglementary period but before the
defendant is declared in default and there is no showing that defendant intends to delay the case and no prejudice is
caused to the plaintiff, the Answer should be admitted.23
It must be emphasized, however, that it is not mandatory on the part of the trial court to admit an Answer which is
belatedly filed where the defendant is not yet declared in default. Settled is the rule that it is within the discretion of
the trial court to permit the filing of an answer even beyond the reglementary period, provided that there is
justification for the belated action and there is no showing that the defendant intended to delay the case. 24
In the instant case, the MeTC found it proper not to admit petitioner's Answer and to subsequently declare him in
default, because petitioner's Ex Parte Motion for Extension of Time to File His Answer was filed out of time; that
petitioner filed his Answer beyond the period requested in the Motion for Extension; and that petitioner failed to
appear during the scheduled hearing on respondent's Motion to declare him in default.
The Court finds no cogent reason to depart from the above ruling of the MeTC, as affirmed by the RTC and the CA.
Sablas differs from the instant case on two aspects, to wit: first, in Sablas, the petitioners' motion for extension to file
their answer was seasonably filed while in the present case, petitioner's Motion for Extension to File His Answer was
filed beyond the 15-day period allowed by the Rules of Court; second, in Sablas, since the trial court admitted the
petitioners' Answer, this Court held that the trial court was correct in denying the subsequent motion of the respondent
to declare the petitioners in default while, in the instant case, the MeTC denied due course to petitioner's Answer on
the ground that the Motion for Extension was not seasonably filed and that the Answer was filed beyond the period
requested in the Motion for Extension, thus, justifying the order of default. Thus, the principle enunciated in Sablas is
not applicable in the present case.
In this respect, the Court agrees with the CA in its ruling that procedural rules are not to be ignored or disdained at
will to suit the convenience of a party.
Procedural rules are designed to facilitate the adjudication of cases. 25 Courts and litigants alike are enjoined to abide
strictly by the rules.26 While in certain instances, the Court allows a relaxation in the application of the rules, there is
no intention to forge a weapon for erring litigants to violate the rules with impunity. 27 The liberal interpretation and
application of rules apply only in proper cases of demonstrable merit and under justifiable causes and
circumstances.28 While it is true that litigation is not a game of technicalities, it is equally true that every case must be
prosecuted in accordance with the prescribed procedure to ensure an orderly and speedy administration of
justice.29 Party litigants and their counsel are well advised to abide by – rather than flaunt – procedural rules for these
rules illumine the path of the law and rationalize the pursuit of justice.30
Moreover, while the Court frowns upon default judgments, it does not condone gross transgressions of the rules. 31The
Court is duty-bound to observe its rules and procedures and uphold the noble purpose behind their issuance. Rules are
laid down for the benefit of all and should not be made dependent upon a suitor’s sweet time and own bidding. 32
Petitioner's negligence in the present case is inexcusable, because aside from the belated filing of his Motion for
Extension to File His Answer, he also failed to file his Answer within the period requested in his Motion without
offering any justifiable excuse. Moreover, as observed by the MeTC in its Order dated February 8, 2008, petitioner
also failed to appear during the scheduled hearing on respondent's Motion to Declare Him in Default. Furthermore,
petitioner did not deny respondent's allegation that he also failed to appear during his requested date of hearing of his
Motion to Set Aside the Order of Default. From these circumstances, the Court finds no compelling ground to depart
from the findings of the CA that petitioner is guilty of deliberately employing delay in the prosecution of the civil case
against him.
Aside from petitioner's abovementioned breach of procedural rules, the Court notes that petitioner and his counsel
once again committed another violation when they failed to comply with this Court's Resolution dated March 16, 2011
requiring petitioner to file his Reply to respondent's Comment-Opposition to the present petition. It is true that this
Court set aside its Resolution dated July 27, 2011 which dismissed the instant petition on the basis of this infraction
committed by petitioner. However, it cannot be denied that this infringement affirms petitioner's propensity to ignore
at will not only the rules of procedure but also the lawful order of the Court.
The Court agrees with respondent's observation that in his Memorandum filed with the RTC, petitioner reasoned out
that his failure to seasonably file his Answer was due to the inadvertence and pressure of work on the part of his
counsel.
In their Motion for Reconsideration of this Court's July 27, 2011 Resolution, petitioner, through his counsel, again
used as excuse for their failure to file the required pleading the allegation that the counsel had voluminous workload.
However, petitioner's counsel cannot hide from this pretense as he himself claimed that they, in fact, had no intention
to file a Reply. Instead, they intended to simply file a Manifestation indicating their desire to waive their right to reply
and that they are adopting the arguments in their Petition as their Reply to respondent's Comment. If that, indeed, was
the case, then the preparation of the intended manifestation could have taken just a few minutes. In fact, a perusal of
petitioner's Motion for Reconsideration with Manifestation shows that it is a mere recapitulation of his arguments
raised in his petition.33 Yet, petitioner failed to file his Manifestation on time, which is within a period of ten (10) days
from his receipt of the Resolution requiring his reply. Indeed, petitioner's counsel admitted that they received the
Resolution requiring petitioner to file his Reply on April 26, 2011. However, petitioner ignored this Resolution and it
was only on September 16, 2011, or almost five months after, that petitioner filed his Motion for Reconsideration with
Manifestation. Notably, the said Motion for Reconsideration with Manifestation was filed only when this Court issued
another Resolution dismissing the instant petition for petitioner's failure to comply with the order of this Court
directing him to file his reply. This only indicates that were it not for the dismissal of his petition, petitioner and his
counsel would have continued to ignore this Court's lawful order.
Truly, the conduct of petitioner and his counsel can never be a case of excusable neglect. On the contrary, it smacks of
a blatant disregard of the rules and lawful directives of the court. Thus, giving in to petitioner's maneuvering is
tantamount to putting premium on a litigant's naked indolence and sanctioning a scheme of prolonging litigation.
It bears stressing that a lawyer has the responsibility of monitoring and keeping track of the period of time left to file
pleadings, and to see to it that said pleadings are filed before the lapse of the period. 34 If he fails to do so, his client is
bound by his conduct, negligence and mistakes. 35 In the present case, petitioner and his counsel knew and should have
known of the periods within which they are to file their pleadings. In fact, with respect to their Answer, they should be
aware that they had only until July 21, 2007 to file the same because they were the ones who requested for an
extension of time to file the said Answer. It was incumbent on petitioners’ counsel to arrange his workload and attend
to important and pressing matters such that pleadings are filed within the prescribed period therefor. 36 If the failure of
the petitioners’ counsel to cope with his heavy workload should be considered a valid justification to sidestep the
reglementary period, there would be no end to litigations so long as counsel had not been sufficiently diligent or
experienced.37
Time and again, this Court has cautioned lawyers to handle only as many cases as they can efficiently handle. 38 The
zeal and fidelity demanded of a lawyer to his client’s cause require that not only should he be qualified to handle a
legal matter, he must also prepare adequately and give appropriate attention to his legal work. 39 Since a client is, as a
rule, bound by the acts of his counsel, a lawyer, once he agrees to take a case, should undertake the task with
dedication and care.40 This Court frowns upon a lawyer’s practice of repeatedly seeking extensions of time to file
pleadings and thereafter simply letting the period lapse without submitting any pleading or even any explanation or
manifestation for his omission.41 Failure of a lawyer to seasonably file a pleading constitutes inexcusable negligence
on his part.
On the other hand, it would not also be amiss to remind petitioner of the settled rule that litigants, represented by
counsel, should not expect that all they need to do is sit back, relax and await the outcome of their case. 42 Instead, they
should give the necessary assistance to their counsel and exercise due diligence to monitor the status of the case for
what is at stake is their interest in the case.43 This petitioner failed to do.
In any case, respondent was. granted favorable relief only after the MeTC has ascertained that such relief is warranted
by the evidence presented and the facts proven by the respondent. The Court agrees with the CA in holding that even
if he was declared in default, petitioner was not deprived of his right to appeal. In fact, he appealed his case to the
RTC, which ruled squarely on the merits of respondent's complaint and found sufficient evidence to sustain the ruling
of the MeTC in respondent's favor.
WHEREFORE, the petition for review on certiorari is DENIED. The April 29, 2010 Decision and the October 12,
2010 Resolution of the Court of Appeals are AFFIRMED.
SO ORDERED.