Archive for November, 2011


CASE 2011-0221: FERNANDO CO (FORMERLY DOING BUSINESS UNDER THE NAME “NATHANIEL MAMI HOUSE”VS. LINA B. VARGAS (G.R. NO. 195167, 16 NOVEMBER 2011, CARPIO, J.) SUBJECTS: SC NOT TRIER OF FACTS; C.A. FINDINGS OF FACTS ARE CONCLUSIVE AND FINAL; EXCEPTIONS TO THE RULE THAT SC CANNOT REVIEW FACTS. (BRIEF TITLE: CO VS. VARGAS)

Filed under: LATEST SUPREME COURT CASES — 1 Comment
November 30, 2011

CASE 2011-0221: FERNANDO CO (FORMERLY DOING BUSINESS UNDER THE NAME “NATHANIEL MAMI HOUSE”VS. LINA B. VARGAS (G.R. NO. 195167, 16 NOVEMBER 2011, CARPIO, J.) SUBJECTS: SC NOT TRIER OF FACTS; C.A. FINDINGS OF FACTS ARE CONCLUSIVE AND FINAL; EXCEPTIONS TO THE RULE THAT SC CANNOT REVIEW FACTS. (BRIEF TITLE: CO VS. VARGAS)

 

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DISPOSITIVE:

 

 

WHEREFORE, we DENY the petition. We AFFIRM the 29 June 2010 Decision and the 5 January 2011 Resolution of the Court of Appeals in CA-G.R. SP No. 110728.

 

SO ORDERED.

 

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SUBJECTS/DOCTRINES/DIGEST:

 

 

VARGAS FILED A CASE AGAINST CO FOR ILLEGAL DISMISSAL. CO’S DEFENSE IS THAT VARGAS WAS A DOMESTIC HELPER AND NOT AN EMPLOYEE IN THEIR BAKERY. THE LABOR ARBITER RULED THAT VARGAS WAS ILLEGALLY DISMISSED. NLRC REVERSED. C.A. UPHELD THE RULING OF THE LABOR ARBITER. AT THE PROCEEDINGS IT WAS ALLEGED AND NOT REFUTED THAT VARGAS WORKED IN THE BAKERY WHERE CO AND HIS FAMILY RESIDE. BUT IN THE MOTION FOR RECONSIDERATION AT THE C.A., CO ALLEGED THAT THE BAKERY WAS NOT IN THE SAME PLACE WHERE THEY RESIDE AND CO INTRODUCED EVIDENCE TO SUPPORT THIS. MUST SUCH EVIDENCE BE CONSIDERED NOW BY THE SUPREME COURT?

 

 

 

NO.  THE ISSUE IS A QUESTION OF FACT WHICH REQUIRES A REVIEW OF THE EVIDENCE. SC IS NOT A TRIER OF FACTS. IT IS NOT  THE FUNCTION OF THE SUPREME  COURT TO EXAMINE, REVIEW OR EVALUATE THE EVIDENCE ALL OVER AGAIN,14 SPECIALLY ON EVIDENCE RAISED FOR THE FIRST TIME ON APPEAL.15

 

 

 

In this case, it was only in petitioner’s Supplement to the Motion for Reconsideration of the Court of Appeals’ Decision that petitioner raised the issue that contrary to the findings of the Labor Arbiter, NLRC, and the Court of Appeals, the bakery was not located at his residence at the time respondent was in their employ. Furthermore, petitioner would even have this Court evaluate additional documentary evidence which were not offered during the proceedings in the Labor Arbiter, NLRC, and the Court of Appeals. The additional evidence were only submitted after the Court of Appeals promulgated its Decision, when petitioner attached the additional evidence in his Supplement to the Motion for Reconsideration.12

 

The issue raised by petitioner is clearly a question of fact which requires a review of the evidence presented. The Supreme Court is not a trier of facts.13 It is not the function of this Court to examine, review or evaluate the evidence all over again,14 specially on evidence raised for the first time on appeal.15

 

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WHAT IS COVERED BY PETITION FOR REVIEW UNDER RULE 45?

 

 

ONLY QUESTIONS OF LAW WHICH MUST BE DISTINCTLY SET FORTH.

 

 

 

A petition for review under Rule 45 of the Rules of Court should cover only questions of law, thus:

 

Section 1. Filing of petition with Supreme Court. – A party desiring to appeal by certiorari from a judgment or final order or resolution of the Court of Appeals, the Sandiganbayan, the Regional Trial Court or other courts whenever authorized by law, may file with the Supreme Court a verified petition for review on certiorari. The petition shall raise only questions of law which must be distinctly set forth. (Emphasis supplied)

 

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CAN SUPREME COURT REVIEW FINDINGS OF FACTS OF C.A.?

 

 

AS A RULE, NO BECAUSE THE FINDINGS OF FACTS OF THE  C.A. ARE FINAL AND CONCLUSIVE.

 

 

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BUT ARE THERE EXCEPTIONS TO THIS RULE?

 

 

YES. AS FOLLOWS:

 

 

(1) WHEN THE FINDINGS ARE GROUNDED ENTIRELY ON SPECULATIONS, SURMISES OR CONJECTURES;

 

 

(2) WHEN THE INFERENCE MADE IS MANIFESTLY MISTAKEN, ABSURD OR IMPOSSIBLE;

 

 

(3) WHEN THERE IS GRAVE ABUSE OF DISCRETION;

 

 

(4) WHEN THE JUDGMENT IS BASED ON A MISAPPREHENSION OF FACTS;

 

 

(5) WHEN THE FINDINGS OF FACT ARE CONFLICTING;

 

 

(6) WHEN IN MAKING ITS FINDINGS THE COURT OF APPEALS WENT BEYOND THE ISSUES OF THE CASE, OR ITS FINDINGS ARE CONTRARY TO THE ADMISSIONS OF BOTH THE APPELLANT AND THE APPELLEE;

 

 

(7) WHEN THE FINDINGS ARE CONTRARY TO THAT OF THE TRIAL COURT;

 

 

(8) WHEN THE FINDINGS ARE CONCLUSIONS WITHOUT CITATION OF SPECIFIC EVIDENCE ON WHICH THEY ARE BASED;

 

 

(9) WHEN THE FACTS SET FORTH IN THE PETITION AS WELL AS IN THE PETITIONER’S MAIN AND REPLY BRIEFS ARE NOT DISPUTED BY THE RESPONDENT;

 

 

(10) WHEN THE FINDINGS OF FACT ARE PREMISED ON THE SUPPOSED ABSENCE OF EVIDENCE AND CONTRADICTED BY THE EVIDENCE ON RECORD; OR

 

 

(11) WHEN THE COURT OF APPEALS MANIFESTLY OVERLOOKED CERTAIN RELEVANT FACTS NOT DISPUTED BY THE PARTIES, WHICH, IF PROPERLY CONSIDERED, WOULD JUSTIFY A DIFFERENT CONCLUSION.18

 

 

As a rule, the findings of fact of the Court of Appeals are final and conclusive and this Court will not review them on appeal,16 subject to exceptions such as those enumerated by this Court in Development Bank of the Philippines v. Traders Royal Bank:17

 

The jurisdiction of the Court in cases brought before it from the appellate court is limited to reviewing errors of law, and findings of fact of the Court of Appeals are conclusive upon the Court since it is not the Court’s function to analyze and weigh the evidence all over again. Nevertheless, in several cases, the Court enumerated the exceptions to the rule that factual findings of the Court of Appeals are binding on the Court: (1) when the findings are grounded entirely on speculations, surmises or conjectures; (2) when the inference made is manifestly mistaken, absurd or impossible; (3) when there is grave abuse of discretion; (4) when the judgment is based on a misapprehension of facts; (5) when the findings of fact are conflicting; (6) when in making its findings the Court of Appeals went beyond the issues of the case, or its findings are contrary to the admissions of both the appellant and the appellee; (7) when the findings are contrary to that of the trial court; (8) when the findings are conclusions without citation of specific evidence on which they are based; (9) when the facts set forth in the petition as well as in the petitioner’s main and reply briefs are not disputed by the respondent; (10) when the findings of fact are premised on the supposed absence of evidence and contradicted by the evidence on record; or (11) when the Court of Appeals manifestly overlooked certain relevant facts not disputed by the parties, which, if properly considered, would justify a different conclusion.18

 

 

Petitioner failed to show that this case falls under any of the exceptions. The finding of the Labor Arbiter that petitioner’s bakery and his residence are located at the same place was not reversed by the NLRC.19 Furthermore, the Court of Appeals upheld this finding of the Labor Arbiter. We find no justifiable reason to deviate from the findings and ruling of the Court of Appeals.

 

 

SECOND DIVISION

 

FERNANDO CO (formerly doing business under the name “Nathaniel Mami House”*),

Petitioner,

 

 

– versus –

 

 

LINA B. VARGAS,

Respondent.

   G.R. No. 195167

 

Present:

 

CARPIO, J., Chairperson,

BRION,

PEREZ,

SERENO, and

REYES, JJ.

 

 

 

Promulgated:

November 16, 2011

x – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – x

 

R E S O L U T I O N

 

CARPIO, J.:

 

The Case

 

This petition for review1 assails the 29 June 2010 Decision2 and the 5 January 2011 Resolution3 of the Court of Appeals in CA-G.R. SP No. 110728. The Court of Appeals set aside the 11 June 2008 Decision4 of the National Labor Relations Commission (NLRC) and reinstated the 30 October 2004 Decision5 of the Labor Arbiter.

 

The Facts

On 22 April 2003, respondent Lina B. Vargas (respondent) filed against Nathaniel Bakeshop and its owner Fernando Co a complaint for underpayment or non-payment of wages and holiday pay.6 The complaint was later amended to include illegal dismissal as a cause of action and the non-payment of service incentive leave.7

 

Respondent alleged that she started working at the bakeshop in October 1994 as a baker and worked from 8:00 a.m. until 8:30 p.m., Monday to Saturday. Aside from baking, respondent also served the customers and supervised the other workers in the absence of the owner. Furthermore, respondent claimed that she sometimes cooked and did the chores of a housemaid whenever the latter was not available. Respondent had a salary of P220 per day, which she received every Saturday afternoon. During the period of her employment, respondent was not given a payslip and she was never asked to sign a payroll.

 

On 6 April 2003, petitioner Co’s wife, Nely Co, told respondent to cook their lunch because the housemaid was ironing clothes. Since respondent was busy preparing customers’ orders, she lost track of time and was unable to cook lunch as instructed. Irate at respondent’s failure to cook, Nely Co cussed respondent and told her to leave and never to return because she was not needed anymore. Respondent was so humiliated and could no longer bear the treatment she received from her employers that she decided to take her salary and leave that same day. Respondent later filed the complaint against Nathaniel Bakeshop and its owner Fernando Co.

 

 

Petitioner denies respondent’s claim that she was employed as a baker in their business. Petitioner alleges that they hired respondent to work as a housemaid. Petitioner refutes respondent’s version of the events which allegedly happened on 6 April 2003. Petitioner alleges that in April 2003, his wife, Nely Co, reprimanded respondent for her failure to cook lunch on time. Angered at being reprimanded, respondent then demanded her salary and walked out of petitioner’s residence and has never reported for work again. Petitioner further avers that respondent badmouthed petitioner’s daughter and displayed defiance, disrespect and insubordination toward them.

 

On 30 October 2004, the Labor Arbiter rendered a Decision, the dispositive portion of which reads:

 

WHEREFORE, premises considered, judgment is hereby rendered finding illegal complainant’s dismissal. Consequently, respondents are hereby held liable and ordered to reinstate complainant to her former position without loss of seniority rights and other privileges with full backwages initially computed at this time at P110,436.04.

 

IN CASE REINSTATEMENT BECOMES IMPOSSIBLE DUE TO SOME SUPERVENING EVENT, RESPONDENTS ARE ALSO ORDERED TO PAY COMPLAINANT’S SEPARATION PAY COMPUTED at one month’s pay for every year of service.

 

Respondents are likewise ordered to pay complainant’s service incentive leave of P3,332.50, 13th month pay (pro-rata) of P1,551.66 and salary differential of P1,723.41.

 

All other claims are hereby dismissed for lack of merit.

 

SO ORDERED.8

 

The Labor Arbiter found that the place of business of petitioner is the same as his place of residence and that respondent works for petitioner as well as for his business which is based in his home. Thus, the Labor Arbiter concluded that “while complainant may have started her employ doing chores for the [petitioner’s] family, she also fulfilled tasks connected with the [petitioner’s] business such as cooking, filling orders, baking orders, and other clerical work, all of which are usually necessary and desirable in the usual trade or business of the respondent. Inescapably, complainant is a regular employee and thus, entitled to security of tenure.”9

On appeal, the NLRC reversed and set aside the Labor Arbiter’s Decision. The NLRC concluded that respondent was not employed as a baker at petitioner’s bakeshop but was merely petitioner’s housemaid who left her employ voluntarily. The NLRC found petitioner not guilty of illegal dismissal.

 

Respondent filed a petition for certiorari with the Court of Appeals.

 

The Ruling of the Court of Appeals

 

On 29 June 2010, the Court of Appeals promulgated its Decision in favor of respondent. The Court of Appeals annulled the NLRC Decision and reinstated the 30 October 2004 Decision of the Labor Arbiter. The Court of Appeals ruled:

 

[I]t is clear that petitioner [Lina B. Vargas] is not a househelper or domestic servant of private respondents [Nathaniel Bakeshop and Fernando Co]. The evidence shows that petitioner is working within the premises of the business of private respondent Co and in relation to or in connection with such business. In the Memorandum of Appeal filed by private respondents before the NLRC, the place of business of respondent Co and his residence is located in the same place, Brgy. Juliana, San Fernando, Pampanga. Thus, respondent Co exercised control and supervision over petitioner’s functions. Respondent Co’s averment that petitioner had the simple task of cleaning the house and cooking at times and was not involved in the business was negated by the fact that petitioner likewise takes the orders of private respondents’ customers. Even if petitioner was actually working as domestic servant in private respondent’s residence, her act of taking orders, which was ratiocinated by the NLRC as not leading to the conclusion that petitioner in fact took the orders, would warrant the conclusion that petitioner should be considered as a regular employee and not as a mere family househelper or domestic servant of respondent Co.

 

Private respondents relied heavily on the recantation (through an Affidavit of Recantation) by Joseph Baybayon of his Affidavit stating that petitioner was an employee, to boast [sic] their theory that petitioner is a mere domestic helper. Nonetheless, this Court is convinced that the allegations in the first affidavit are sufficient to establish that petitioner is an employee of private respondent and not a housemaid. Granting arguendo, that the second affidavit validly repudiated the first one, courts generally do not look with favor on any retraction or recanted testimony, for it could have been secured by considerations other than to tell the truth and would make solemn trials a mockery and place the investigation of the truth at the mercy of unscrupulous witnesses. A recantation does not necessarily cancel an earlier declaration, but like any other testimony, the same is subject to the test of credibility and should be received with caution.

 

Having resolved the issue that petitioner was an employee of private respondents and not a housemaid, was petitioner illegally dismissed? The answer is in the affirmative. Since petitioner is an employee of private respondents, she is entitled to security of tenure. The NLRC observed that it was petitioner who left private respondents on April 6, 2003 when petitioner was allegedly driven away from work by Nely Co. Private respondents’ witnesses, Jay dela Cruz and Maria Fe Reniva, averred that it was petitioner who abandoned her job by not reporting for work. But their affidavits did state that the two were employees of private respondent. The other two documents considered by the NLRC were the affidavits of Felisa Borason San Andres (who allegedly helped petitioner to be employed as housemaid of Nely Co) and Alma P. Agorita (an alleged co-housemaid of petitioner in the Co residence). Surprisingly, the affidavit of Felisa Borason San Andres was written in English, considering the statement that she was employed as househelper of Nely Co. The question is whether the said househelper understood what was written in her affidavit or if the same was explained to her in her native language, for she was a resident of San Felipe,NagaCity, where she allegedly executed her affidavit. All told, the said affidavits cannot be given credence to refute the fact that petitioner was an employee of private respondent Co doing work in relation to private respondent’s business, which is that of a bakeshop.

 

Assuming further that petitioner abandoned her job, the Supreme Court held in Ultra Villa Food Haus and/or Rosie Tio vs. NLRC that to constitute abandonment, two requisites must concur: (1) the failure to report to work or absence without valid or justifiable reason, and (2) a clear intention to sever the employer-employee relationship as manifested by some overt acts, with the second requisite as the more determinative factor. The burden of proving abandonment as a just cause for dismissal is on the employer. Private respondents failed to discharge this burden. The only evidence adduced by private respondents to prove abandonment were the affidavits of their househelpers and employees.

 

WHEREFORE, premises considered, the petition is GRANTED. The Decision of the National Labor Relations Commission, Second Division dated June 11, 2008 is hereby ANNULLED and SET ASIDE and the Decision of the Labor Arbiter dated October 30, 2004 is REINSTATED.

 

SO ORDERED.10 (Boldfacing supplied)

 

Petitioner filed a Motion for Reconsideration, which the Court of Appeals denied in its Resolution dated 5 January 2011. Hence, this petition.

The Issue

 

Petitioner raises the sole issue of whether the “Court of Appeals erred in ruling that at the time Respondent was working with the Co family, the business was being conducted at the residence.”11

The Ruling of the Court

 

We find the petition without merit.

 

 

In this case, it was only in petitioner’s Supplement to the Motion for Reconsideration of the Court of Appeals’ Decision that petitioner raised the issue that contrary to the findings of the Labor Arbiter, NLRC, and the Court of Appeals, the bakery was not located at his residence at the time respondent was in their employ. Furthermore, petitioner would even have this Court evaluate additional documentary evidence which were not offered during the proceedings in the Labor Arbiter, NLRC, and the Court of Appeals. The additional evidence were only submitted after the Court of Appeals promulgated its Decision, when petitioner attached the additional evidence in his Supplement to the Motion for Reconsideration.12

 

The issue raised by petitioner is clearly a question of fact which requires a review of the evidence presented. The Supreme Court is not a trier of facts.13 It is not the function of this Court to examine, review or evaluate the evidence all over again,14 specially on evidence raised for the first time on appeal.15

 

A petition for review under Rule 45 of the Rules of Court should cover only questions of law, thus:

 

Section 1. Filing of petition with Supreme Court. – A party desiring to appeal by certiorari from a judgment or final order or resolution of the Court of Appeals, the Sandiganbayan, the Regional Trial Court or other courts whenever authorized by law, may file with the Supreme Court a verified petition for review on certiorari. The petition shall raise only questions of law which must be distinctly set forth. (Emphasis supplied)

 

As a rule, the findings of fact of the Court of Appeals are final and conclusive and this Court will not review them on appeal,16 subject to exceptions such as those enumerated by this Court in Development Bank of the Philippines v. Traders Royal Bank:17

 

The jurisdiction of the Court in cases brought before it from the appellate court is limited to reviewing errors of law, and findings of fact of the Court of Appeals are conclusive upon the Court since it is not the Court’s function to analyze and weigh the evidence all over again. Nevertheless, in several cases, the Court enumerated the exceptions to the rule that factual findings of the Court of Appeals are binding on the Court: (1) when the findings are grounded entirely on speculations, surmises or conjectures; (2) when the inference made is manifestly mistaken, absurd or impossible; (3) when there is grave abuse of discretion; (4) when the judgment is based on a misapprehension of facts; (5) when the findings of fact are conflicting; (6) when in making its findings the Court of Appeals went beyond the issues of the case, or its findings are contrary to the admissions of both the appellant and the appellee; (7) when the findings are contrary to that of the trial court; (8) when the findings are conclusions without citation of specific evidence on which they are based; (9) when the facts set forth in the petition as well as in the petitioner’s main and reply briefs are not disputed by the respondent; (10) when the findings of fact are premised on the supposed absence of evidence and contradicted by the evidence on record; or (11) when the Court of Appeals manifestly overlooked certain relevant facts not disputed by the parties, which, if properly considered, would justify a different conclusion.18

 

 

Petitioner failed to show that this case falls under any of the exceptions. The finding of the Labor Arbiter that petitioner’s bakery and his residence are located at the same place was not reversed by the NLRC.19 Furthermore, the Court of Appeals upheld this finding of the Labor Arbiter. We find no justifiable reason to deviate from the findings and ruling of the Court of Appeals.

 

WHEREFORE, we DENY the petition. We AFFIRM the 29 June 2010 Decision and the 5 January 2011 Resolution of the Court of Appeals in CA-G.R. SP No. 110728.

 

SO ORDERED.

 

ANTONIO T. CARPIO

Associate Justice

WE CONCUR:

 

 

 

 

ARTURO D. BRION

Associate Justice

 

 

 

 

JOSE PORTUGAL PEREZ MARIA LOURDES P. A. SERENO

Associate Justice Associate Justice

 

 

 

 

BIENVENIDO L. REYES

Associate Justice

 

 

ATTESTATION

I attest that the conclusions in the above Resolution had been reached in consultation before the case was assigned to the writer of the opinion of the Court’s Division.

 

 

 

ANTONIO T. CARPIO

Associate Justice

Chairperson

 

 

CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution, and the Division Chairperson’s Attestation, I certify that the conclusions in the above Resolution had been reached in consultation before the case was assigned to the writer of the opinion of the Court’s Division.

 

 

 

RENATO C. CORONA

Chief Justice

 

 

 

 

 

 

*Also known as “Nathaniel’s Bakeshop.”

1Under Rule 45 of the 1997 Rules of Civil Procedure.

2Rollo, pp. 12-25. Penned by Associate Justice Magdangal M. DeLeon, with Associate Justices Mario V. Lopez and Amy C. Lazaro-Javier, concurring.

3Id. at 86-87.

4CA rollo, pp. 245-264.

5Id. at 110-125.

6Id. at 28-29.

7Id. at 30-31.

8Id. at 124-125.

9Id. at 121.

10Rollo, pp. 22-24.

11Petition for Review, p. 24.

12Rollo, pp. 88-145.

13Aliño v. Heirs of Angelica A. Lorenzo, G.R. No. 159550, 27 June 2008, 556 SCRA 139; Diesel Construction Co., Inc. v. UPSI Property Holdings, Inc., G.R. Nos. 154885 & 154937, 24 March 2008, 549 SCRA 12.

14Alicer v. Compas, G.R. No. 187720, 30 May 2011.

15China Banking Corporation v. Asian Construction and Development Corporation, G.R. No. 158271, 8 April 2008, 550 SCRA 585.

16Sps. Andrada v. Pilhino Sales Corporation, G.R. No. 156448, 23 February 2011; Atlas Consolidated Mining and Development Corporation v. Commissioner of Internal Revenue, G.R. No. 159490, 18 February 2008, 546 SCRA 150; Microsoft Corporation v. Maxicorp, Inc., 481 Phil. 550 (2004).

17G.R. No. 171982, 18 August 2010, 628 SCRA 404.

18Id. at 413-414.

19Although the NLRC reversed the Labor Arbiter’s Decision and held that respondent was not employed as a baker at petitioner’s bakeshop but was merely petitioner’s housemaid, the NLRC did not reverse the Labor Arbiter’s finding that the bakery is located at petitioner’s residence.

 

Comment

TRIAL NOTE 0016: ON CONFLICT OF INTEREST IN LEGAL PRACTICE

Filed under: TIPS FOR TRIAL LAWYERS — 1 Comment
November 28, 2011

TRIAL NOTE 0016: ON CONFLICT OF INTEREST IN LEGAL PRACTICE

 

SOURCE: LYDIA CASTRO-JUSTO VS. ATTY. RODOLFO T. GALING (A.C. NO. 6174, 16 NOVEMBER 2011, PEREZ, J.) SUBJECTS: CLIENT-LAWYER RELATIONSHIP; CONFLICT OF INTERESTS; WHEN ALLOWED.  (BRIEF TITLE: JUSTO VS. ATTY. GALING)

 

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SUBJECTS/ DOCTRINES/ DIGEST:

 

 

MS. JUSTO REQUESTED ATTY. GALING TO MAKE DEMAND LETTER TO MS. KOA FOR DISHONORED CHECKS. ATTY. GALING PREPARED DEMAND LETTER. WHEN THE CASE WAS FILED IN COURT ATTY. GALING REPRESENTED MS. KOA.  MS. JUSTO FILED DISBARMENT CASE AGAINST ATTY. GALING FOR CONFLICT OF INTEREST. ATTY. GALING ARGUED THAT THERE WAS NO CLIENT-LAWYER RELATIONSHIP BECAUSE SHE HAS NOT YET PAID HIM. ALSO IN THE CRIMINAL COMPLAINT IT WAS NOT HIS DEMAND LETTER USED BUT THAT OF ANOTHER LAWYER. WAS THERE ALREADY A CLIENT-LAWYER RELATIONSHIP?

 

 

 

YES.  THE RELATIONSHIP WAS ESTABLISHED THE MOMENT COMPLAINANT SOUGHT LEGAL ADVICE FROM RESPONDENT REGARDING THE DISHONORED CHECKS.  BY DRAFTING THE DEMAND LETTER RESPONDENT FURTHER AFFIRMED SUCH RELATIONSHIP.

 

 

        We are not persuaded.  A lawyer-client relationship can exist notwithstanding the close friendship between complainant and respondent.  The relationship was established the moment complainant sought legal advice from respondent regarding the dishonored checks.  By drafting the demand letter respondent further affirmed such relationship.  The fact that the demand letter was not utilized in the criminal complaint filed and that respondent was not eventually engaged by complainant to represent her in the criminal cases is of no moment.  As observed by the Investigating Commissioner, by referring to complainant Justo as “my client” in the demand letter sent to the defaulting debtor[1][10], respondent admitted the existence of the lawyer-client relationship.  Such admission effectively estopped him from claiming otherwise.

 

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BUT THERE WAS NO PAYMENT YET OF PROFESSIONAL FEE. WILL THIS EXCULPATE ATTY. GALING FROM LIABILITY.

 

 

NO. ABSENCE OF MONETARY CONSIDERATION DOES NOT EXEMPT LAWYERS FROM COMPLYING WITH THE PROHIBITION AGAINST PURSUING CASES WITH CONFLICTING INTERESTS.

 

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WHEN DOES SUCH PROHIBITION AGAINST PURSUING CASES WITH CONFLICTING INTERESTS BEGINS AND WHEN DOES IT ENDS?

 

 

THE PROHIBITION ATTACHES FROM THE MOMENT THE ATTORNEY-CLIENT RELATIONSHIP IS ESTABLISHED AND EXTENDS BEYOND THE DURATION OF THE PROFESSIONAL RELATIONSHIP.[2][11]

 

Likewise, the non-payment of professional fee will not exculpate respondent from liability.  Absence of monetary consideration does not exempt lawyers from complying with the prohibition against pursuing cases with conflicting interests.  The prohibition attaches from the moment the attorney-client relationship is established and extends beyond the duration of the professional relationship.[3][11]  We held in Burbe v. Atty. Magulta[4][12] that it is not necessary that any retainer be paid, promised or charged; neither is it material that the attorney consulted did not afterward handle the case for which his service had been sought.[5][13]

 

 

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CAN THE LAWYER STILL REPRESENT CONFLICTING INTERESTS?

 

 

YES. BY WRITTEN CONSENT OF ALL CONCERNED GIVEN AFTER A FULL DISCLOSURE OF THE FACTS.

 

 

        Under Rule 15.03, Canon 15 of the Code of Professional Responsibility, “[a] lawyer shall not represent conflicting interests except by written consent of all concerned given after a full disclosure of the facts.”  Respondent was therefore bound to refrain from representing parties with conflicting interests in a controversy.   By doing so, without showing any proof that he had obtained the written consent of the conflicting parties, respondent should be sanctioned.

 

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WHAT IS THE GROUND FOR THE PROHIBITION AGAINST REPRSENTING CONFLICTING INTEREST?

 

 

 

PRINCIPLES OF PUBLIC POLICY AND GOOD TASTE. THE RELATIONSHIP IS ONE OF TRUST AND CONFIDENCE OF THE HIGHEST DEGREE. ONLY THEN CAN LITIGANTS ENTRUST THEIR SECRETS TO THEIR LAWYERS.

 

 

        The prohibition against representing conflicting interest is founded on principles of public policy and good taste.[6][14]   In the course of the lawyer-client relationship, the lawyer learns of the facts connected with the client’s case, including the weak and strong points of the case.  The nature of the relationship is, therefore, one of trust and confidence of the highest degree.[7][15] 

 

        It behooves lawyers not only to keep inviolate the client’s confidence, but also to avoid the appearance of treachery and double-dealing for only then can litigants be encouraged to entrust their secrets to their lawyers, which is of paramount importance in the administration of justice.[8][16]

 

 

WHEN IS THERE CONFLICT OF INTEREST?

 

 

IN THE FOLLOWING INSTANCES:

 

 

–                     WHEN LAWYER REPRESENTS INCONSISTENT INTERESTS OF TWO OR MORE OPPOSING PARTIES.

 

 

–                     WHEN 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

 

 

–                     WHEN   HE WILL BE CALLED UPON IN HIS NEW RELATION TO USE AGAINST HIS FIRST CLIENT ANY KNOWLEDGE ACQUIRED THROUGH THEIR CONNECTION.[9][20]

 

 

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WHAT ARE  THE TESTS TO KNOW IF THERE IS CONFLICT OF INTEREST.

 

 

–       ONE 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.[10][21]

 

 

–                     ANOTHER 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.’[11][18]

 

 

The case of Hornilla v. Atty. Salunat[12][17] is instructive on this concept, 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.’[13][18]  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.[14][19]  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.[15][20] 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.[16][21]

 

 

XXXXXXXXXXXXXXXXXX

 

 

 

HOW ABOUT THE CONTENTION THAT ANOTHER LAWYER TOOK OVER THE CASE? WILL THIS NOT GIVE THE LAWYER THE RIGHT TO REPRESENT THE OPPOSING PARTY?

 

 

 

NO. THE TAKE- OVER OF A CLIENT’S CAUSE OF ACTION BY ANOTHER LAWYER DOES NOT GIVE THE FORMER LAWYER THE RIGHT TO REPRESENT THE OPPOSING PARTY.  IT IS NOT ONLY MALPRACTICE BUT ALSO CONSTITUTES A VIOLATION OF THE CONFIDENCE RESULTING FROM THE ATTORNEY-CLIENT RELATIONSHIP. 

 

 

        The excuse proffered by respondent that it was not him but Atty. Año who was eventually engaged by complainant will not exonerate him from the clear violation of Rule 15.03 of the Code of Professional Responsibility.  The take- over of a client’s cause of action by another lawyer does not give the former lawyer the right to represent the opposing party.  It is not only malpractice but also constitutes a violation of the confidence resulting from the attorney-client relationship. 

 

 

=========================

 

SECOND DIVISION

 

 

LYDIA CASTRO-JUSTO,

                              Complainant,

 

 

 

–  versus  –

 

 

 

 

 

ATTY. RODOLFO T. GALING,

                              Respondent.

   A.C. No. 6174

 

Present:

 

CARPIO,

      Chairperson,

BRION,

PEREZ,

SERENO, and

REYES, JJ.

 

Promulgated:

 

November 16, 2011
     

x- – – – – – – – – – – – – – – – – – – – – – – – – – – – –  – – – – – – – – – – – – – –  – – -x

 

D E C I S I O N

 

PEREZ, J.:

 

 

          Before us for consideration is Resolution No. XVIII-2007-196[17][1] of the Board of Governors, Integrated Bar of the Philippines (IBP), relative to the complaint[18][2] for disbarment filed by Lydia Castro-Justo against Atty. Rodolfo T. Galing. 

 

          Complainant Justo alleged that sometime in April 2003, she engaged the services of respondent Atty. Galing in connection with dishonored checks issued by Manila City Councilor Arlene W. Koa (Ms. Koa).  After she paid his professional fees, the respondent drafted and sent a letter to Ms. Koa demanding payment of the checks.[19][3]  Respondent advised complainant to wait for the lapse of the period indicated in the demand letter before filing her complaint.  

 

          On 10 July 2003, complainant filed a criminal complaint against Ms. Koa for estafa and violation of Batas Pambansa Blg. 22 before the Office of the City Prosecutor of Manila.[20][4]

 

          On 27 July 2003, she received a copy of a Motion for Consolidation[21][5] filed by respondent for and on behalf of Ms. Koa, the accused in the criminal cases, and the latter’s daughter Karen Torralba (Ms. Torralba).  Further, on 8 August 2003, respondent appeared as counsel for Ms. Koa before the prosecutor ofManila.

 

          Complainant submits that by representing conflicting interests, respondent violated the Code of Professional Responsibility.

 

          In his Comment,[22][6] respondent denied the allegations against him.  He admitted that he drafted a demand letter for complainant but argued that it was made only in deference to their long standing friendship and not by reason of a professional engagement as professed by complainant.  He denied receiving any professional fee for the services he rendered.  It was allegedly their understanding that complainant would have to retain the services of another lawyer.   He alleged that complainant, based on that agreement, engaged the services of Atty. Manuel A. Año.

 

          To bolster this claim, respondent pointed out that the complaint filed by complainant against Ms. Koa for estafa and violation of B.P. Blg. 22 was based not on the demand letter he drafted but on the demand letter prepared by Atty. Manuel A. Año.

 

          Respondent contended that he is a close friend of the opposing parties in the criminal cases.  He further contended that complainant Justo and Ms. Koa are likewise long time friends, as in fact, they are “comares” for more than 30 years since complainant is the godmother of Ms. Torralba.[23][7]  Respondent claimed that it is in this light that he accommodated Ms. Koa and her daughter’s request that they be represented by him in the cases filed against them by complainant and complainant’s daughter.  He maintained that the filing of the Motion for Consolidation which is a non-adversarial pleading does not evidence the existence of a lawyer-client relationship between him and Ms. Koa and Ms. Torralba.  Likewise, his appearance in the joint proceedings should only be construed as an effort on his part to assume the role of a moderator or arbiter of the parties.

 

          He insisted that his actions were merely motivated by an intention to help the parties achieve an out of court settlement and possible reconciliation.  He reported that his efforts proved fruitful insofar as he had caused Ms. Koa to pay complainant the amount of P50,000.00 in settlement of one of the two checks subject of I.S. No. 03G-19484-86.

 

          Respondent averred that the failure of Ms. Koa and Ms. Torralba to make good the other checks caused a lot of consternation on the part of complainant. This allegedly led her to vent her ire on respondent and file the instant administrative case for conflict of interest. 

 

          In a resolution dated 19 October 2007, the Board of Governors of the IBP adopted and approved with modification the findings of its Investigating Commissioner.  They found respondent guilty of violating Canon 15, Rule 15.03 of the Code of Professional Responsibility by representing conflicting interests and for his daring audacity and for the pronounced malignancy of his act.   It was recommended that he be suspended from the practice of law for one (1) year with a warning that a repetition of the same or similar acts will be dealt with more severely.[24][8] 

 

          We agree with the Report and Recommendation of the Investigating Commissioner,[25][9] as adopted by the Board of Governors of the IBP. 

 

          It was established that in April 2003, respondent was approached by complainant regarding the dishonored checks issued by Manila City Councilor Koa. 

 

          It was also established that on 25 July 2003, a Motion for Consolidation was filed by respondent in I.S. No. 03G-19484-86 entitled “Lydia Justo vs. Arlene Koa” and I.S. No. 03G-19582-84 entitled “Lani C. Justo vs. Karen Torralba”.   Respondent stated that the movants in these cases are mother and daughter while complainants are likewise mother and daughter and that these cases arose out from the same transaction.  Thus, movants and complainants will be adducing the same sets of evidence and witnesses.

 

          Respondent argued that no lawyer-client relationship existed between him and complainant because there was no professional fee paid for the services he rendered.  Moreover, he argued that he drafted the demand letter only as a personal favor to complainant who is a close friend.

 

          We are not persuaded.  A lawyer-client relationship can exist notwithstanding the close friendship between complainant and respondent.  The relationship was established the moment complainant sought legal advice from respondent regarding the dishonored checks.  By drafting the demand letter respondent further affirmed such relationship.  The fact that the demand letter was not utilized in the criminal complaint filed and that respondent was not eventually engaged by complainant to represent her in the criminal cases is of no moment.  As observed by the Investigating Commissioner, by referring to complainant Justo as “my client” in the demand letter sent to the defaulting debtor[26][10], respondent admitted the existence of the lawyer-client relationship.  Such admission effectively estopped him from claiming otherwise.

 

          Likewise, the non-payment of professional fee will not exculpate respondent from liability.  Absence of monetary consideration does not exempt lawyers from complying with the prohibition against pursuing cases with conflicting interests.  The prohibition attaches from the moment the attorney-client relationship is established and extends beyond the duration of the professional relationship.[27][11]  We held in Burbe v. Atty. Magulta[28][12] that it is not necessary that any retainer be paid, promised or charged; neither is it material that the attorney consulted did not afterward handle the case for which his service had been sought.[29][13]

 

          Under Rule 15.03, Canon 15 of the Code of Professional Responsibility, “[a] lawyer shall not represent conflicting interests except by written consent of all concerned given after a full disclosure of the facts.”  Respondent was therefore bound to refrain from representing parties with conflicting interests in a controversy.   By doing so, without showing any proof that he had obtained the written consent of the conflicting parties, respondent should be sanctioned.

 

          The prohibition against representing conflicting interest is founded on principles of public policy and good taste.[30][14]   In the course of the lawyer-client relationship, the lawyer learns of the facts connected with the client’s case, including the weak and strong points of the case.  The nature of the relationship is, therefore, one of trust and confidence of the highest degree.[31][15] 

 

          It behooves lawyers not only to keep inviolate the client’s confidence, but also to avoid the appearance of treachery and double-dealing for only then can litigants be encouraged to entrust their secrets to their lawyers, which is of paramount importance in the administration of justice.[32][16]

 

          The case of Hornilla v. Atty. Salunat[33][17] is instructive on this concept, 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.’[34][18]  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.[35][19]  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.[36][20] 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.[37][21]

 

          The excuse proffered by respondent that it was not him but Atty. Año who was eventually engaged by complainant will not exonerate him from the clear violation of Rule 15.03 of the Code of Professional Responsibility.  The take- over of a client’s cause of action by another lawyer does not give the former lawyer the right to represent the opposing party.  It is not only malpractice but also constitutes a violation of the confidence resulting from the attorney-client relationship. 

 

          Considering that this is respondent’s first infraction, the disbarment sought in the complaint is deemed to be too severe.  As recommended by the Board of Governors of the IBP, the suspension from the practice of law for one (1) year is warranted.

 

          Accordingly, the Court resolved to SUSPEND Atty. Rodolfo T. Galing from the practice of law for one (1) year, with a WARNING that a repetition of the same or similar offense will warrant a more severe penalty. Let copies of this Decision be furnished all courts, the Office of the Bar Confidant and the Integrated Bar of thePhilippines for their information and guidance.  The Office of the Bar Confidant is directed to append a copy of this Decision to respondent’s record as member of the Bar.

 

 

SO ORDERED.

 

 

 

 

 

 

JOSE PORTUGAL PEREZ

Associate Justice

 

 

WE CONCUR:

 

 

 

ANTONIO T. CARPIO

Associate Justice

Chairperson

 

 

    

 

   ARTURO D. BRION               MARIA LOURDES P. A. SERENO        

       Associate Justice                                  Associate Justice

 

 

 

BIENVENIDO L. REYES

Associate Justice

 

 

 

 

 

 

 

[1][10]         Id. at 48.

[2][11]          Buted v. Hernando, A.C. No. 1359, 17 October 1991, 203 SCRA 1, 8.

[3][11]          Buted v. Hernando, A.C. No. 1359, 17 October 1991, 203 SCRA 1, 8.

[4][12]          432 Phil. 840 (2002).

[5][13]         Id. at 848.

[6][14]          Hilado v. David, 84 Phil 569, 578 (1949).

[7][15]          Maturan v. Gonzales, A.C. No. 2597, 12 March 1998, 287 SCRA 443, 446.

[8][16]          Supra note 14 at 579.

[9][20]          Id. at 111-112 citing Pineda, Legal and Judicial Ethics, p.199, citing Pierce v. Palmer,      31 R.I.     432.

[10][21]         Id. at 112 citing Agpalo, Legal Ethics, p. 220, citing in Re De la Rosa, 27 Phil.     258[1914]; Grievance Committee v. Rottner, 152 Conn. 59, 203 A 2d 82 [1954] and      Titania v. Ocampo, 200 SCRA 472 [1991].

[11][18]         Id. at 111 citing Pineda, Legal and Judicial Ethics, p. 199 [1999 ed.].

[12][17]         453 Phil. 108 (2003).

[13][18]         Id. at 111 citing Pineda, Legal and Judicial Ethics, p. 199 [1999 ed.].

[14][19]         Id. citing Hilado v. David, 84 Phil. 569[1949]; Nombrado v. Hernandez, 26 SCRA 13             [1968];    Bautista v. Barrios, 9 SCRA 695 [1963].

[15][20]         Id. at 111-112 citing Pineda, Legal and Judicial Ethics, p.199, citing Pierce v. Palmer,      31 R.I.     432.

[16][21]         Id. at 112 citing Agpalo, Legal Ethics, p. 220, citing in Re De la Rosa, 27 Phil.     258[1914]; Grievance Committee v. Rottner, 152 Conn. 59, 203 A 2d 82 [1954] and      Titania v. Ocampo, 200 SCRA 472 [1991].

[17][1]          Rollo, p. 45.

[18][2]         Id. at 1-2.

[19][3]         Id. at 3-4.

[20][4]         Id. at 5-6.

[21][5]         Id. at 10-11.

[22][6]         Id. at 14-22.

[23][7]         Id. at 16.

[24][8]         Id. at 45.

[25][9]         Id. at 46-53.

[26][10]        Id. at 48.

[27][11]         Buted v. Hernando, A.C. No. 1359, 17 October 1991, 203 SCRA 1, 8.

[28][12]         432 Phil. 840 (2002).

[29][13]        Id. at 848.

[30][14]         Hilado v. David, 84 Phil 569, 578 (1949).

[31][15]         Maturan v. Gonzales, A.C. No. 2597, 12 March 1998, 287 SCRA 443, 446.

[32][16]         Supra note 14 at 579.

[33][17]         453 Phil. 108 (2003).

[34][18]         Id. at 111 citing Pineda, Legal and Judicial Ethics, p. 199 [1999 ed.].

[35][19]         Id. citing Hilado v. David, 84 Phil. 569[1949]; Nombrado v. Hernandez, 26 SCRA 13             [1968];    Bautista v. Barrios, 9 SCRA 695 [1963].

[36][20]         Id. at 111-112 citing Pineda, Legal and Judicial Ethics, p.199, citing Pierce v. Palmer,      31 R.I.     432.

[37][21]         Id. at 112 citing Agpalo, Legal Ethics, p. 220, citing in Re De la Rosa, 27 Phil.     258[1914]; Grievance Committee v. Rottner, 152 Conn. 59, 203 A 2d 82 [1954] and      Titania v. Ocampo, 200 SCRA 472 [1991].

Comment

CASE 2011-0220: LYDIA CASTRO-JUSTO VS. ATTY. RODOLFO T. GALING (A.C. NO. 6174, 16 NOVEMBER 2011, PEREZ, J.) SUBJECTS: CLIENT-LAWYER RELATIONSHIP; CONFLICT OF INTERESTS; WHEN ALLOWED. (BRIEF TITLE: JUSTO VS. ATTY. GALING)

Filed under: Uncategorized — 1 Comment
November 27, 2011

CASE 2011-0220: LYDIA CASTRO-JUSTO VS. ATTY. RODOLFO T. GALING (A.C. NO. 6174, 16 NOVEMBER 2011, PEREZ, J.) SUBJECTS: CLIENT-LAWYER RELATIONSHIP; CONFLICT OF INTERESTS; WHEN ALLOWED.  (BRIEF TITLE: JUSTO VS. ATTY. GALING)

 

======================== 

 

 

DISPOSITIVE:

 

Accordingly, the Court resolved to SUSPEND Atty. Rodolfo T. Galing from the practice of law for one (1) year, with a WARNING that a repetition of the same or similar offense will warrant a more severe penalty. Let copies of this Decision be furnished all courts, the Office of the Bar Confidant and the Integrated Bar of thePhilippines for their information and guidance.  The Office of the Bar Confidant is directed to append a copy of this Decision to respondent’s record as member of the Bar.

 

 

SO ORDERED.

 

========================

 

 

SUBJECTS/ DOCTRINES/ DIGEST:

 

 

MS. JUSTO REQUESTED ATTY. GALING TO MAKE DEMAND LETTER TO MS. KOA FOR DISHONORED CHECKS. ATTY. GALING PREPARED DEMAND LETTER. WHEN THE CASE WAS FILED IN COURT ATTY. GALING REPRESENTED MS. KOA.  MS. JUSTO FILED DISBARMENT CASE AGAINST ATTY. GALING FOR CONFLICT OF INTEREST. ATTY. GALING ARGUED THAT THERE WAS NO CLIENT-LAWYER RELATIONSHIP BECAUSE SHE HAS NOT YET PAID HIM. ALSO IN THE CRIMINAL COMPLAINT IT WAS NOT HIS DEMAND LETTER USED BUT THAT OF ANOTHER LAWYER. WAS THERE ALREADY A CLIENT-LAWYER RELATIONSHIP?

 

 

 

YES.  THE RELATIONSHIP WAS ESTABLISHED THE MOMENT COMPLAINANT SOUGHT LEGAL ADVICE FROM RESPONDENT REGARDING THE DISHONORED CHECKS.  BY DRAFTING THE DEMAND LETTER RESPONDENT FURTHER AFFIRMED SUCH RELATIONSHIP.

 

 

        We are not persuaded.  A lawyer-client relationship can exist notwithstanding the close friendship between complainant and respondent.  The relationship was established the moment complainant sought legal advice from respondent regarding the dishonored checks.  By drafting the demand letter respondent further affirmed such relationship.  The fact that the demand letter was not utilized in the criminal complaint filed and that respondent was not eventually engaged by complainant to represent her in the criminal cases is of no moment.  As observed by the Investigating Commissioner, by referring to complainant Justo as “my client” in the demand letter sent to the defaulting debtor[1][10], respondent admitted the existence of the lawyer-client relationship.  Such admission effectively estopped him from claiming otherwise.

 

XXXXXXXXXXXXXXXXXXXXX

 

 

 

BUT THERE WAS NO PAYMENT YET OF PROFESSIONAL FEE. WILL THIS EXCULPATE ATTY. GALING FROM LIABILITY.

 

 

NO. ABSENCE OF MONETARY CONSIDERATION DOES NOT EXEMPT LAWYERS FROM COMPLYING WITH THE PROHIBITION AGAINST PURSUING CASES WITH CONFLICTING INTERESTS.

 

 

        Likewise, the non-payment of professional fee will not exculpate respondent from liability.  Absence of monetary consideration does not exempt lawyers from complying with the prohibition against pursuing cases with conflicting interests.  The prohibition attaches from the moment the attorney-client relationship is established and extends beyond the duration of the professional relationship.[2][11]  We held in Burbe v. Atty. Magulta[3][12] that it is not necessary that any retainer be paid, promised or charged; neither is it material that the attorney consulted did not afterward handle the case for which his service had been sought.[4][13]

XXXXXXXXXXXXXXXXXX

 

 

CAN THE LAWYER STILL REPRESENT CONFLICTING INTERESTS?

 

 

YES. BY WRITTEN CONSENT OF ALL CONCERNED GIVEN AFTER A FULL DISCLOSURE OF THE FACTS.

 

 

        Under Rule 15.03, Canon 15 of the Code of Professional Responsibility, “[a] lawyer shall not represent conflicting interests except by written consent of all concerned given after a full disclosure of the facts.”  Respondent was therefore bound to refrain from representing parties with conflicting interests in a controversy.   By doing so, without showing any proof that he had obtained the written consent of the conflicting parties, respondent should be sanctioned.

 

XXXXXXXXXXXXXXX

 

 

 

WHAT IS THE GROUND FOR THE PROHIBITION AGAINST REPRSENTING CONFLICTING INTEREST?

 

 

 

PRINCIPLES OF PUBLIC POLICY AND GOOD TASTE. THE RELATIONSHIP IS ONE OF TRUST AND CONFIDENCE OF THE HIGHEST DEGREE. ONLY THEN CAN LITIGANTS ENTRUST THEIR SECRETS TO THEIR LAWYERS.

 

 

        The prohibition against representing conflicting interest is founded on principles of public policy and good taste.[5][14]   In the course of the lawyer-client relationship, the lawyer learns of the facts connected with the client’s case, including the weak and strong points of the case.  The nature of the relationship is, therefore, one of trust and confidence of the highest degree.[6][15] 

 

        It behooves lawyers not only to keep inviolate the client’s confidence, but also to avoid the appearance of treachery and double-dealing for only then can litigants be encouraged to entrust their secrets to their lawyers, which is of paramount importance in the administration of justice.[7][16]

 

 

WHEN IS THERE CONFLICT OF INTEREST?

 

 

IN THE FOLLOWING INSTANCES:

 

 

–                     WHEN LAWYER REPRESENTS INCONSISTENT INTERESTS OF TWO OR MORE OPPOSING PARTIES.

 

 

–                     WHEN 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

 

 

–                     WHEN   HE WILL BE CALLED UPON IN HIS NEW RELATION TO USE AGAINST HIS FIRST CLIENT ANY KNOWLEDGE ACQUIRED THROUGH THEIR CONNECTION.[8][20]

 

 

XXXXXXXXXXXXXXXXXXX

 

 

 

WHAT ARE  THE TESTS TO KNOW IF THERE IS CONFLICT OF INTEREST.

 

 

–       ONE 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.[9][21]

 

 

–                     ANOTHER 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.’[10][18]

 

 

The case of Hornilla v. Atty. Salunat[11][17] is instructive on this concept, 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.’[12][18]  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.[13][19]  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.[14][20] 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.[15][21]

 

 

XXXXXXXXXXXXXXXXXX

 

 

 

HOW ABOUT THE CONTENTION THAT ANOTHER LAWYER TOOK OVER THE CASE? WILL THIS NOT GIVE THE LAWYER THE RIGHT TO REPRESENT THE OPPOSING PARTY?

 

 

 

NO. THE TAKE- OVER OF A CLIENT’S CAUSE OF ACTION BY ANOTHER LAWYER DOES NOT GIVE THE FORMER LAWYER THE RIGHT TO REPRESENT THE OPPOSING PARTY.  IT IS NOT ONLY MALPRACTICE BUT ALSO CONSTITUTES A VIOLATION OF THE CONFIDENCE RESULTING FROM THE ATTORNEY-CLIENT RELATIONSHIP. 

 

 

        The excuse proffered by respondent that it was not him but Atty. Año who was eventually engaged by complainant will not exonerate him from the clear violation of Rule 15.03 of the Code of Professional Responsibility.  The take- over of a client’s cause of action by another lawyer does not give the former lawyer the right to represent the opposing party.  It is not only malpractice but also constitutes a violation of the confidence resulting from the attorney-client relationship. 

 

 

=========================

 

SECOND DIVISION

 

 

LYDIA CASTRO-JUSTO,

                              Complainant,

 

 

 

–  versus  –

 

 

 

 

 

ATTY. RODOLFO T. GALING,

                              Respondent.

   A.C. No. 6174

 

Present:

 

CARPIO,

      Chairperson,

BRION,

PEREZ,

SERENO, and

REYES, JJ.

 

Promulgated:

 

November 16, 2011
     

x- – – – – – – – – – – – – – – – – – – – – – – – – – – – –  – – – – – – – – – – – – – –  – – -x

 

D E C I S I O N

 

PEREZ, J.:

 

 

          Before us for consideration is Resolution No. XVIII-2007-196[16][1] of the Board of Governors, Integrated Bar of the Philippines (IBP), relative to the complaint[17][2] for disbarment filed by Lydia Castro-Justo against Atty. Rodolfo T. Galing. 

 

          Complainant Justo alleged that sometime in April 2003, she engaged the services of respondent Atty. Galing in connection with dishonored checks issued by Manila City Councilor Arlene W. Koa (Ms. Koa).  After she paid his professional fees, the respondent drafted and sent a letter to Ms. Koa demanding payment of the checks.[18][3]  Respondent advised complainant to wait for the lapse of the period indicated in the demand letter before filing her complaint.  

 

          On 10 July 2003, complainant filed a criminal complaint against Ms. Koa for estafa and violation of Batas Pambansa Blg. 22 before the Office of the City Prosecutor of Manila.[19][4]

 

          On 27 July 2003, she received a copy of a Motion for Consolidation[20][5] filed by respondent for and on behalf of Ms. Koa, the accused in the criminal cases, and the latter’s daughter Karen Torralba (Ms. Torralba).  Further, on 8 August 2003, respondent appeared as counsel for Ms. Koa before the prosecutor ofManila.

 

          Complainant submits that by representing conflicting interests, respondent violated the Code of Professional Responsibility.

 

          In his Comment,[21][6] respondent denied the allegations against him.  He admitted that he drafted a demand letter for complainant but argued that it was made only in deference to their long standing friendship and not by reason of a professional engagement as professed by complainant.  He denied receiving any professional fee for the services he rendered.  It was allegedly their understanding that complainant would have to retain the services of another lawyer.   He alleged that complainant, based on that agreement, engaged the services of Atty. Manuel A. Año.

 

          To bolster this claim, respondent pointed out that the complaint filed by complainant against Ms. Koa for estafa and violation of B.P. Blg. 22 was based not on the demand letter he drafted but on the demand letter prepared by Atty. Manuel A. Año.

 

          Respondent contended that he is a close friend of the opposing parties in the criminal cases.  He further contended that complainant Justo and Ms. Koa are likewise long time friends, as in fact, they are “comares” for more than 30 years since complainant is the godmother of Ms. Torralba.[22][7]  Respondent claimed that it is in this light that he accommodated Ms. Koa and her daughter’s request that they be represented by him in the cases filed against them by complainant and complainant’s daughter.  He maintained that the filing of the Motion for Consolidation which is a non-adversarial pleading does not evidence the existence of a lawyer-client relationship between him and Ms. Koa and Ms. Torralba.  Likewise, his appearance in the joint proceedings should only be construed as an effort on his part to assume the role of a moderator or arbiter of the parties.

 

          He insisted that his actions were merely motivated by an intention to help the parties achieve an out of court settlement and possible reconciliation.  He reported that his efforts proved fruitful insofar as he had caused Ms. Koa to pay complainant the amount of P50,000.00 in settlement of one of the two checks subject of I.S. No. 03G-19484-86.

 

          Respondent averred that the failure of Ms. Koa and Ms. Torralba to make good the other checks caused a lot of consternation on the part of complainant. This allegedly led her to vent her ire on respondent and file the instant administrative case for conflict of interest. 

 

          In a resolution dated 19 October 2007, the Board of Governors of the IBP adopted and approved with modification the findings of its Investigating Commissioner.  They found respondent guilty of violating Canon 15, Rule 15.03 of the Code of Professional Responsibility by representing conflicting interests and for his daring audacity and for the pronounced malignancy of his act.   It was recommended that he be suspended from the practice of law for one (1) year with a warning that a repetition of the same or similar acts will be dealt with more severely.[23][8] 

 

          We agree with the Report and Recommendation of the Investigating Commissioner,[24][9] as adopted by the Board of Governors of the IBP. 

 

          It was established that in April 2003, respondent was approached by complainant regarding the dishonored checks issued by Manila City Councilor Koa. 

 

          It was also established that on 25 July 2003, a Motion for Consolidation was filed by respondent in I.S. No. 03G-19484-86 entitled “Lydia Justo vs. Arlene Koa” and I.S. No. 03G-19582-84 entitled “Lani C. Justo vs. Karen Torralba”.   Respondent stated that the movants in these cases are mother and daughter while complainants are likewise mother and daughter and that these cases arose out from the same transaction.  Thus, movants and complainants will be adducing the same sets of evidence and witnesses.

 

          Respondent argued that no lawyer-client relationship existed between him and complainant because there was no professional fee paid for the services he rendered.  Moreover, he argued that he drafted the demand letter only as a personal favor to complainant who is a close friend.

 

          We are not persuaded.  A lawyer-client relationship can exist notwithstanding the close friendship between complainant and respondent.  The relationship was established the moment complainant sought legal advice from respondent regarding the dishonored checks.  By drafting the demand letter respondent further affirmed such relationship.  The fact that the demand letter was not utilized in the criminal complaint filed and that respondent was not eventually engaged by complainant to represent her in the criminal cases is of no moment.  As observed by the Investigating Commissioner, by referring to complainant Justo as “my client” in the demand letter sent to the defaulting debtor[25][10], respondent admitted the existence of the lawyer-client relationship.  Such admission effectively estopped him from claiming otherwise.

 

          Likewise, the non-payment of professional fee will not exculpate respondent from liability.  Absence of monetary consideration does not exempt lawyers from complying with the prohibition against pursuing cases with conflicting interests.  The prohibition attaches from the moment the attorney-client relationship is established and extends beyond the duration of the professional relationship.[26][11]  We held in Burbe v. Atty. Magulta[27][12] that it is not necessary that any retainer be paid, promised or charged; neither is it material that the attorney consulted did not afterward handle the case for which his service had been sought.[28][13]

 

          Under Rule 15.03, Canon 15 of the Code of Professional Responsibility, “[a] lawyer shall not represent conflicting interests except by written consent of all concerned given after a full disclosure of the facts.”  Respondent was therefore bound to refrain from representing parties with conflicting interests in a controversy.   By doing so, without showing any proof that he had obtained the written consent of the conflicting parties, respondent should be sanctioned.

 

          The prohibition against representing conflicting interest is founded on principles of public policy and good taste.[29][14]   In the course of the lawyer-client relationship, the lawyer learns of the facts connected with the client’s case, including the weak and strong points of the case.  The nature of the relationship is, therefore, one of trust and confidence of the highest degree.[30][15] 

 

          It behooves lawyers not only to keep inviolate the client’s confidence, but also to avoid the appearance of treachery and double-dealing for only then can litigants be encouraged to entrust their secrets to their lawyers, which is of paramount importance in the administration of justice.[31][16]

 

          The case of Hornilla v. Atty. Salunat[32][17] is instructive on this concept, 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.’[33][18]  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.[34][19]  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.[35][20] 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.[36][21]

 

          The excuse proffered by respondent that it was not him but Atty. Año who was eventually engaged by complainant will not exonerate him from the clear violation of Rule 15.03 of the Code of Professional Responsibility.  The take- over of a client’s cause of action by another lawyer does not give the former lawyer the right to represent the opposing party.  It is not only malpractice but also constitutes a violation of the confidence resulting from the attorney-client relationship. 

 

          Considering that this is respondent’s first infraction, the disbarment sought in the complaint is deemed to be too severe.  As recommended by the Board of Governors of the IBP, the suspension from the practice of law for one (1) year is warranted.

 

          Accordingly, the Court resolved to SUSPEND Atty. Rodolfo T. Galing from the practice of law for one (1) year, with a WARNING that a repetition of the same or similar offense will warrant a more severe penalty. Let copies of this Decision be furnished all courts, the Office of the Bar Confidant and the Integrated Bar of thePhilippines for their information and guidance.  The Office of the Bar Confidant is directed to append a copy of this Decision to respondent’s record as member of the Bar.

 

 

SO ORDERED.

 

 

 

 

 

 

JOSE PORTUGAL PEREZ

Associate Justice

 

 

WE CONCUR:

 

 

 

ANTONIO T. CARPIO

Associate Justice

Chairperson

 

 

    

 

   ARTURO D. BRION               MARIA LOURDES P. A. SERENO        

       Associate Justice                                  Associate Justice

 

 

 

BIENVENIDO L. REYES

Associate Justice

 

 

 

 

 

 

 

[1][10]         Id. at 48.

[2][11]          Buted v. Hernando, A.C. No. 1359, 17 October 1991, 203 SCRA 1, 8.

[3][12]          432 Phil. 840 (2002).

[4][13]         Id. at 848.

[5][14]          Hilado v. David, 84 Phil 569, 578 (1949).

[6][15]          Maturan v. Gonzales, A.C. No. 2597, 12 March 1998, 287 SCRA 443, 446.

[7][16]          Supra note 14 at 579.

[8][20]          Id. at 111-112 citing Pineda, Legal and Judicial Ethics, p.199, citing Pierce v. Palmer,      31 R.I.     432.

[9][21]          Id. at 112 citing Agpalo, Legal Ethics, p. 220, citing in Re De la Rosa, 27 Phil.     258[1914]; Grievance Committee v. Rottner, 152 Conn. 59, 203 A 2d 82 [1954] and      Titania v. Ocampo, 200 SCRA 472 [1991].

[10][18]         Id. at 111 citing Pineda, Legal and Judicial Ethics, p. 199 [1999 ed.].

[11][17]         453 Phil. 108 (2003).

[12][18]         Id. at 111 citing Pineda, Legal and Judicial Ethics, p. 199 [1999 ed.].

[13][19]         Id. citing Hilado v. David, 84 Phil. 569[1949]; Nombrado v. Hernandez, 26 SCRA 13             [1968];    Bautista v. Barrios, 9 SCRA 695 [1963].

[14][20]         Id. at 111-112 citing Pineda, Legal and Judicial Ethics, p.199, citing Pierce v. Palmer,      31 R.I.     432.

[15][21]         Id. at 112 citing Agpalo, Legal Ethics, p. 220, citing in Re De la Rosa, 27 Phil.     258[1914]; Grievance Committee v. Rottner, 152 Conn. 59, 203 A 2d 82 [1954] and      Titania v. Ocampo, 200 SCRA 472 [1991].

[16][1]          Rollo, p. 45.

[17][2]         Id. at 1-2.

[18][3]         Id. at 3-4.

[19][4]         Id. at 5-6.

[20][5]         Id. at 10-11.

[21][6]         Id. at 14-22.

[22][7]         Id. at 16.

[23][8]         Id. at 45.

[24][9]         Id. at 46-53.

[25][10]        Id. at 48.

[26][11]         Buted v. Hernando, A.C. No. 1359, 17 October 1991, 203 SCRA 1, 8.

[27][12]         432 Phil. 840 (2002).

[28][13]        Id. at 848.

[29][14]         Hilado v. David, 84 Phil 569, 578 (1949).

[30][15]         Maturan v. Gonzales, A.C. No. 2597, 12 March 1998, 287 SCRA 443, 446.

[31][16]         Supra note 14 at 579.

[32][17]         453 Phil. 108 (2003).

[33][18]         Id. at 111 citing Pineda, Legal and Judicial Ethics, p. 199 [1999 ed.].

[34][19]         Id. citing Hilado v. David, 84 Phil. 569[1949]; Nombrado v. Hernandez, 26 SCRA 13             [1968];    Bautista v. Barrios, 9 SCRA 695 [1963].

[35][20]         Id. at 111-112 citing Pineda, Legal and Judicial Ethics, p.199, citing Pierce v. Palmer,      31 R.I.     432.

[36][21]         Id. at 112 citing Agpalo, Legal Ethics, p. 220, citing in Re De la Rosa, 27 Phil.     258[1914]; Grievance Committee v. Rottner, 152 Conn. 59, 203 A 2d 82 [1954] and      Titania v. Ocampo, 200 SCRA 472 [1991].

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