Cases on Moral Turpitud

G.R. No. 180363, April 28, 2009

EDGAR Y. TEVES, Petitioner, vs. THE COMMISSION ON

ELECTIONS and HERMINIO G. TEVES

Facts:

         Petitioner was a candidate for the position of Representative of

the 3rd legislative district of Negros Oriental during the May 14, 2007

elections.

         Respondent Herminio G. Teves filed a petition to disqualify

petitioner on the ground that in Teves v. Sandiganbayan,3 he was

convicted of violating Section 3(h), Republic Act (R.A.) No. 3019, or

the Anti-Graft and Corrupt Practices Act, for possessing pecuniary

or financial interest in a cockpit, which is prohibited under Section

89(2) of the Local Government Code (LGC) of 1991.

         Respondent alleged that petitioner is disqualified from running for

public office because he was convicted of a crime involving moral

turpitude which carries the accessory penalty of perpetual

disqualification from public office.

         The COMELEC First Division disqualified petitioner from running

for the position of member of House of Representatives and ordered

the cancellation of his Certificate of Candidacy.

         Upon MR, COMELEC en banc denied the motion saying that

since petitioner lost in the last 14 May 2007 congressional elections,

it thereby rendered the instant MR moot and academic.

Issue: Whether petitioner’s violation of Section 3(h), R.A. No. 3019

involves moral turpitude.

Held: NO

         Moral turpitude has been defined as everything which is done

contrary to justice, modesty, or good morals; an act of baseness,

vileness or depravity in the private and social duties which a man

owes his fellowmen, or to society in general.

         The essential elements of the violation of said provision are as

follows: 1) The accused is a public officer; 2) he has a direct or

indirect financial or pecuniary interest in any business, contract or

transaction; 3) he either: a) intervenes or takes part in his official

capacity in connection with such interest, or b) is prohibited from

having such interest by the Constitution or by law.

         Thus, there are two modes by which a public officer who has a

direct or indirect financial or pecuniary interest in any business,

contract, or transaction may violate Section 3(h) of R.A. 3019. The

first mode is when the public officer intervenes or takes part in his

official capacity in connection with his financial or pecuniary interest

in any business, contract, or transaction. The second mode is when

he is prohibited from having such an interest by the Constitution or

by law.

         In Teves v. Sandiganbayan, petitioner was convicted under the

second mode for having pecuniary or financial interest in a cockpit

which is prohibited under Sec. 89(2) of the Local Government Code

of 1991.

o   The evidence for the prosecution has established that petitioner

Edgar Teves, then mayor of Valencia, Negros Oriental, owned the

cockpit in question.

o   Even if the ownership of petitioner Edgar Teves over the cockpit were

transferred to his wife, still he would have a direct interest thereon

because, as correctly held by respondent Sandiganbayan, they

remained married to each other from 1983 up to 1992, and as such

their property relation can be presumed to be that of conjugal

partnership of gains in the absence of evidence to the contrary.

o   Hence, his interest in the Valencia Cockpit is direct and is, therefore,

prohibited under Section 89(2) of the LGC of 1991.

         However, conviction under the second mode does not

automatically mean that the same involved moral turpitude. A

determination of all surrounding circumstances of the violation of the

statute must be considered. Besides, moral turpitude does not

include such acts as are not of themselves immoral but whose

illegality lies in their being positively prohibited, as in the instant

case.

         The Court clarified that not every criminal act, however, involves

moral turpitude. It is for this reason that "as to what crime involves

moral turpitude, is for the Supreme Court to determine." In resolving

the foregoing question, the Court is guided by one of the general

rules that crimes mala in se involve moral turpitude, while crimes

mala prohibita do not.

         Moral turpitude implies something immoral in itself, regardless of

the fact that it is punishable by law or not. It must not be merely mala

prohibita, but the act itself must be inherently immoral. The doing of

the act itself, and not its prohibition by statute fixes the moral

turpitude.

         Consequently, considering all circumstances , the Court held

that petitioner’s conviction does not involve moral turpitude.

         The morality of gambling is not a justiciable issue. Gambling is

not illegal per se. While it is generally considered inimical to the

interests of the people, there is nothing in the Constitution

categorically proscribing or penalizing gambling or, for that

matter, even mentioning it at all. It is left to Congress to deal with

the activity as it sees fit.

         In the exercise of its own discretion, the legislature may prohibit

gambling altogether or allow it without limitation or it may prohibit

some forms of gambling and allow others for whatever reasons it

may consider sufficient. Thus, it has prohibited jueteng and monte

but permits lotteries, cockfighting and horse-racing. In making such

choices, Congress has consulted its own wisdom, which this Court

has no authority to review, much less reverse.

A.C. No. 7940               April 24, 2012

RE: SC DECISION DATED MAY 20, 2008 IN G.R. NO. 161455

UNDER RULE 139-B OF THE RULES OF COURT,

vs. ATTY. RODOLFO D. PACTOLIN, Respondent.

 

D E C I S I O N

PER CURIAM:

This case resolves the question of whether or not the conviction of a

lawyer for a crime involving moral turpitude constitutes sufficient

ground for his disbarment from the practice of law under Section 27,

Rule 138 of the Rules of Court.

The Facts and the Case

In May 1996, Elmer Abastillas, the playing coach of the Ozamis City

volleyball team, wrote Mayor Benjamin A. Fuentes of Ozamis City,

requesting financial assistance for his team. Mayor Fuentes

approved the request and sent Abastillas’ letter to the City Treasurer

for processing. Mayor Fuentes also designated Mario R. Ferraren,

a city council member, as Officer-in-Charge (OIC) of the city

while Mayor Fuentes was away. Abastillas eventually got

the P10,000.00 assistance for his volleyball team.

Meanwhile, respondent lawyer, Atty. Rodolfo D. Pactolin, then a

Sangguniang Panlalawigan member of Misamis Occidental, got a

photocopy of Abastillas’ letter and, using it, filed on June 24, 1996 a

complaint with the Office of the Deputy Ombudsman-Mindanao

against Ferraren for alleged illegal disbursement of   P 10,000.00 in

public funds. Atty. Pactolin attached to the complaint a copy of what

he claimed was a falsified letter of Abastillas, which showed that it

was Ferraren, not Mayor Fuentes, who approved the disbursement.

Aggrieved, Ferraren filed with the Sandiganbayan in Criminal

Case 25665 a complaint against Atty. Pactolin for falsification of

public document.1 On November 12, 2003 the Sandiganbayan

found Atty. Pactolin guilty of falsification under Article 172 and

sentenced him to the indeterminate penalty of imprisonment of 2

years and 4 months of prision correccional as minimum to 4 years, 9

months and 10 days of prision correccional as maximum, to suffer all

the accessory penalties of prision correccional, and to pay a fine

of P5,000.00, with subsidiary imprisonment in case of insolvency.

Atty. Pactolin appealed to this Court but on May 20, 2008 it affirmed

his conviction.2 Since the Court treated the matter as an

administrative complaint against him as well under Rule 139-B of the

Rules of Court, it referred the case to the Integrated Bar of the

Philippines (IBP) for appropriate action.

Because complainant Ferraren neither appeared nor submitted any

pleading during the administrative proceedings before the IBP

Commission on Bar Discipline, on October 9, 2010 the IBP Board of

Governors passed Resolution XIX-2010-632, adopting and approving

the Investigating Commissioner’s Report and Recommendation that

the case against Atty. Pactolin be dismissed for insufficiency of

evidence.

ISSUE: The only issue presented in this case is whether or not Atty.

Pactolin should be disbarred after conviction by final judgment of the

crime of falsification.

Ruling: This Court has ruled that the crime of falsification of public

document is contrary to justice, honesty, and good morals and,

therefore, involves moral turpitude.8 Moral turpitude includes

everything which is done contrary to justice, honesty, modesty, or

good morals. It involves an act of baseness, vileness, or depravity in

the private duties which a man owes his fellowmen, or to society in

general, contrary to the accepted and customary rule of right and

duty between man and woman, or conduct contrary to justice,

honesty, modesty, or good morals.9

As a rule, this Court exercises the power to disbar with great

caution. Being the most severe form of disciplinary sanction, it is

imposed only for the most imperative reasons and in clear cases of

misconduct affecting the standing and moral character of the lawyer

as an officer of the court and a member of the bar.10 Yet this Court

has also consistently pronounced that disbarment is the appropriate

penalty for conviction by final judgment for a crime involving moral

turpitude.11

Here, Atty. Pactolin’s disbarment is warranted. The Sandiganbayan

has confirmed that although his culpability for falsification has been

indubitably established, he has not yet served his sentence. His

conduct only exacerbates his offense and shows that he falls short of

the exacting standards expected of him as a vanguard of the legal

profession.12

To recapitulate, this Court upheld the finding of the Sandiganbayan

that the copy of Abastillas’ letter which Atty. Pactolin attached to his

complaint was spurious. Given the clear absence of a satisfactory

explanation regarding his possession and use of the falsified

Abastillas’ letter, this Court held that the Sandiganbayan did not err

in concluding that it was Atty. Pactolin who falsified the letter. This

Court relied on the settled rule that in the absence of satisfactory

explanation, one found in possession of and who used a forged

document is the forger and therefore guilty of falsification.

This Court’s decision in said falsification case had long become final

and executory. In In Re: Disbarment of Rodolfo Pajo,7 the Court held

that in disbarment cases, it is no longer called upon to review the

judgment of conviction which has become final. The review of the

conviction no longer rests upon this Court.

Under Section 27, Rule 138 of the Rules of Court, a lawyer may be

removed or suspended on the following grounds: (1) deceit; (2)

malpractice; (3) gross misconduct in office; (4) grossly immoral

conduct; (5) conviction of a crime involving moral turpitude; (6)

violation of the lawyer’s oath; (7) willful disobedience of any lawful

order of a superior court; and (8) corruptly or willfully appearing as a

lawyer for a party to a case without authority so to do.

This Court once again reminds all lawyers that they, of all classes

and professions, are most sacredly bound to uphold the law.13 The

privilege to practice law is bestowed only upon individuals who are

competent intellectually, academically and, equally important,

morally. As such, lawyers must at all times conduct themselves,

especially in their dealings with their clients and the public at large,

with honesty and integrity in a manner beyond reproach.14

WHEREFORE, Atty. Rodolfo D. Pactolin is hereby DISBARRED and

his name REMOVED from the Rolls of Attorney. Let a copy of this

decision be attached to his personal records and furnished the Office

of the Bar Confidant, Integrated Bar of the Philippines and the Office

of the Court Administrator for circulation to all courts in the country.

SO ORDERED.

In May 2008, the Supreme Court, in G.R. No. 161455 (Pactolin vs

Sandiganbayan), affirmed the conviction of Atty. Rodolfo Pactolin for

violation of Article 172 of the Revised Penal Code (Falsification by a

Private Individual). It was duly proved that Pactolin falsified a letter,

and presented said letter as evidence in a court of law, in order to

make it appear that his fellow councilor acting as OIC-Mayor illegally

caused the disbursement of public funds. In said decisions, the

Supreme Court referred the case to the Integrated Bar of the

Philippines  for appropriate administrative actions against Pactolin.

ISSUE: What administrative sanctions can be imposed upon Atty.

Pactolin considering his conviction?

HELD: Rodolfo Pactolin should be, and is henceforth disbarred. The

crime of falsification of public document is contrary to justice,

honesty, and good morals and, therefore, involves moral turpitude.

Moral turpitude includes everything which is done contrary to justice,

honesty, modesty, or good morals. It involves an act of baseness,

vileness, or depravity in the private duties which a man owes his

fellowmen, or to society in general, contrary to the accepted and

customary rule of right and duty between man and woman, or

conduct contrary to justice, honesty, modesty, or good morals.

As a rule, the Supreme Court exercises the power to disbar with

great caution. Being the most severe form of disciplinary sanction, it

is imposed only for the most imperative reasons and in clear cases of

misconduct affecting the standing and moral character of the lawyer

as an officer of the court and a member of the bar. But it has always

been held that it is appropriate to disbar a lawyer if he is convicted by

final judgment for a crime involving moral turpitude. Further,

Pactolin’s situation is aggravated by the fact that although his

conviction has been affirmed, he has not served his sentence yet.

Elpidio Tiong V Atty. George M. Florendo

Atty. George Florendo has been serving as the lawyer of spouses

Elpidio and Ma. Elena Tiong. Elpidio, a US citizen is often times

away. For two years, he suspected that his wife and Atty.

Florendo were having an affair. Finally in 1995, he was able

to listen to a telephone conversation where he heard Atty. Florendo

mention amorous words to Ma. Elena. Atty. Florendo confronted the

two and both eventually admitted to their illicit relationship. Atty.

Florendo and Ma. Elena then executed and signed an affidavit, which

was later notarized, stating that they admit of their illicit relationship;

that they are seeking the forgiveness of their respective spouse.

Elpidio forgave Florendo and Ma. Elena. But nevertheless, Elpidio

filed a disbarment case against Florendo.

Florendo said he can no longer be sanctioned because he was

already pardoned.

ISSUE: Whether or not Atty. Florendo is correct.

HELD: No. A petition for suspension or disbarment of a lawyer is a

sui generis case. This class of cases is meant to protect the public

and the courts of undesirable members of the legal profession. As

such, pardon by the offended party of the act complained of does not

operate to offset the ground for disbarment or suspension.

Florendo’s act of having an affair with his client’s wife manifested his

disrespect for the laws on the sanctity of marriage and his own

marital vow of fidelity. It showed his utmost moral depravity and low

regard for the ethics of his profession. He violated the trust reposed

upon him by his client (Canon 17, Code of Professional

Responsibility). His illicit relationship with Ma. Elena amounts to a

disgraceful and grossly immoral conduct warranting disciplinary

action. Section 27, Rule 138 of the Rules of Court provides that an

attorney may be disbarred or suspended from his office for any

deceit, malpractice, or other gross misconduct in office, grossly

immoral conduct, among others. It cannot be also said, as he

claims, that their relationship is merely a moment of indiscretion

considering that their affair went on for more than two years.

Florendo was suspended for 6 months.

 

Teresita D. Santeco vs. Atty. Luna B. AvanceA.C. No. 5834 (formerly CBD-01-861). February 22, 2011

Facts: In an En Banc Decision dated December 11, 2003, the Court found respondent guilty of gross misconduct for, among others, abandoning her client’s cause in bad faith and persistent refusal to comply with lawful orders directed at her without any explanation for doing so. She was ordered suspended from the practice of law for a period of five years.

Subsequently, while respondent’s five-year suspension from the practice of law was still in effect, Judge Consuelo Amog-Bocar, Presiding Judge of the RTC of Iba, Zambales, Branch 71, sent a letter-report dated November 12, 2007 to the Court Administrator informing the latter that respondent had appeared and actively participated in three cases wherein she misrepresented herself as “Atty. Liezl Tanglao”. When opposing counsels confronted her and showed to the court a certification regarding her suspension, respondent admitted and conceded that she is Atty. Luna B. Avance, but qualified that she was only suspended for three years and that her suspension has already been lifted.

Acting on Judge Amog-Bocar’s letter-report, the Court, in a Resolution dated April 9, 2008, required respondent to comment within ten days from notice. Respondent, however, failed to file the required comment. On June 10, 2009, the Court reiterated the directive to comment. Still, respondent failed to comply despite notice. Accordingly, this Court issued a Resolution on September 29, 2009 finding respondent guilty of indirect contempt. Respondent was ordered to pay a fine in the amount of Php 30,000.00 which respondent failed to pay.

Issue: Whether or not Atty. Avance should be disbarred.

Held: Respondent Atty. Luna B. Avance is disbarred for gross

misconduct and willful disobedience of lawful orders of a superior court. Her name is ordered stricken off from the Roll of Attorneys.

Rationale: As an officer of the court, it is a lawyer’s duty to uphold the dignity and authority of the court. The highest form of respect for judicial authority is shown by a lawyer’s obedience to court orders and processes.

We have held that failure to comply with Court directives constitutes gross misconduct, insubordination or disrespect which merits a lawyer’s suspension or even disbarment. Sebastian v. Bajar teachers

Respondent’s cavalier attitude in repeatedly ignoring orders of the Supreme Court constitutes utter disrespect to the judicial institution. Respondent’s conduct indicates a high degree or irresponsibility. A Court’s Resolution is “not to be construed as a mere request, nor should it be complied with partially, inadequately, or selectively. Respondent’s obstinate refusal to comply with the Court’s orders not “only betrays recalcitrant flaw in her character; it also underscores her disrespect of the Court’s lawful orders which is only too deserving of reproof.”

Under Section 27, Rule 138 of the Rules of Court a member of the bar may be disbarred or suspended from office as an attorney for gross misconduct and/or for a willful disobedience of any lawful order of a superior court, to wit:

SEC. 27. Disbarment or suspension of attorneys by Supreme Court; grounds therefor. – A member of the bar may be disbarred or suspended from his office as attorney by the Supreme Court for any deceit, malpractice, or other gross misconduct in such office, grossly immoral conduct, or by reason of his conviction of a crime involving moral turpitude, or of any violation of the oath which he is required to take before admission to practice, or for a willful disobedience of any lawful order of a superior court, or for corruptly or willfully appearing as an attorney for a party to a case without authority so to do. The practice of soliciting cases at law for the purpose of gain, either

personally or through paid agents or brokers, constitutes malpractice. (Emphasis supplied.)

In repeatedly disobeying this Court’s orders, respondent proved herself unworthy of membership in the Philippine Bar. Worse, she remains indifferent to the need to reform herself. Clearly, she is unfit to discharge the duties of an officer of the court an deserves the ultimate penalty of disbarment.

Cayetano vs. MonsodG.R. No. 100113September 3, 1991

FACTS:Respondent Christian Monsod was nominated by President Corazon C. Aquino to the position of chairman of the COMELEC. Petitioner opposed the nomination because allegedly Monsod does not possess required qualification of having been engaged in the practice of law for at least ten years. The 1987 constitution provides in Section 1, Article IX-C: There shall be a Commission on Elections composed of a Chairman and six Commissioners who shall be natural-born citizens of the Philippines and, at the time of their appointment, at least thirty-five years of age, holders of a college degree, and must not have been candidates for any elective position in the immediately preceding elections. However, a majority thereof, including the Chairman, shall be members of the Philippine Bar who have been engaged in the practice of law for at least ten years.

ISSUE: whether the respondent has the ten year practice of law requirement for him to assume such office.

HELD: Practice of law means any activity, in or out of court, which requires the application of law, legal procedure, knowledge, training and experience. "To engage in the practice of law is to perform those acts which are characteristics of the profession. Generally, to

practice law is to give notice or render any kind of service, which device or service requires the use in any degree of legal knowledge or skill.

In general, a practice of law requires a lawyer and client relationship, it is whether in or out of court. Atty. Monsod's past work experiences as a lawyer-economist, a lawyer-manager, a lawyer-entrepreneur of industry, a lawyer-negotiator of contracts, and a lawyer-legislator of both the rich and the poor — verily more than satisfy the constitutional requirement — that he has been engaged in the practice of law for at least ten years..

VINSON PINEDA V. ATTY. DE JESUS, ATTY. AMBROSIO AND ATTY. MARIANO

Facts:Aurora Pineda filed for declaration of nullity of marriage

against Vinson Pineda. Aurora proposed a settlement regarding visitation rights and the separation of properties which was accepted by Vinson. Settlement was approved by the trial court and their marriage was declared null and void.

Throughout the proceedings the respondent counsels were compensated but they still billed petitioner additional legal fees in amounting to P16.5M. Vinson refused to pay the additional fees but instead paid P1.2M.

Respondents filed a complaint with the same trial court.Trial court ordered Vinson to pay a total of P9M. CA reduced

the amount to a total of P2M.

Issues:W/N the RTC had jurisdiction over the claim for additional

legal fees?W/N respondents were entitled to additional legal fees?

Held:

A lawyer may enforce his right to his fees by filing the petition as an incident of the main action. RTC has jurisdiction.

The respondents were seeking to collect P50M which was 10% of the value of the properties awarded to Vinson. What respondents were demanding was additional payment for service rendered in the same case.

The professional engagement between petitioner and respondents was governed by quantum meruit.

Rule 20.4 of the Code of Professional Responsibility advises lawyers to avoid controversies with clients concerning their compensation and to resort to judicial action only to prevent imposition, injustice or fraud. Suits to collect fees should be avoided and should be filed only when circumstances force lawyers to resort to it.In this case, there was no justification for the additional legal fees sought by respondents. It was an act of unconscionable greed!

MAMBULAO LUMBER COMPANY, plaintiff-appellant, vs.PHILIPPINE NATIONAL BANK and ANACLETO HERALDO Deputy Provincial Sheriff of Camarines Norte,defendants-appellees.

FACTS: On May 5, 1956 the plaintiff applied for an industrial loan of P155,000 with the Naga Branch of defendant PNB and the former offered real estate, machinery, logging and transportation equipments as collaterals. The application, however, was approved for a loan of P100,000 only. To secure the payment of the loan, the plaintiff mortgaged to defendant PNB a parcel of land, together with the buildings and improvements existing thereon, situated in the poblacion of Jose Panganiban (formerly Mambulao), province of Camarines Norte, as well as various sawmill equipment, rolling unit and other fixed assets of the plaintiff, all situated in its compound in the aforementioned municipality.

The plaintiff failed to pay the amortization on the amounts released to and received by it. Repeated demands were made upon the plaintiff to pay its obligation but it failed or otherwise refused to do so. Upon inspection and verification made by employees of the PNB, it was found that the plaintiff had already stopped operation about the end of 1957 or early part of 1958.

On November 6, 1961, the PNB sent a letter to the Provincial Sheriff of Camarines Norte requesting him to take possession of the chattels mortgaged to it by the plaintiff and sell them at public auction also on November 21, 1961, for the satisfaction of the sum of P57,646.59, plus 6% annual interest therefore from September 23, 1961, attorney's fees equivalent to 10% of the amount due and the costs and expenses of the sale.

Deputy Provincial Sheriff Anacleto Heraldo took possession of the chattels mortgaged by the plaintiff and made an inventory.

Appellant next assails the award of attorney's fees and the expenses of the foreclosure sale in favor of the PNB. With respect to the amount of P298.54 allowed as expenses of the extra-judicial sale of the real property, appellant maintains that the same has no basis, factual or legal, and should not have been awarded. It likewise decries the award of attorney's fees which, according to the appellant, should not be deducted from the proceeds of the sale of the real property, not only because there is no express agreement in the real estate mortgage contract to pay attorney's fees in case the same is extra-judicially foreclosed, but also for the reason that the PNB neither spent nor incurred any obligation to pay attorney's fees in connection with the said extra-judicial foreclosure under consideration.

ISSUE: WON attorneys fees should be paid and if so are they reasonable?

Ruling:

YES, there was a stipulation in the Mortgage that attorneys fees should be paid to wit:

xxxxx the Mortgagor hereby agrees further that in all cases, attorney's fees hereby fixed at Ten Per cent (10%) of the total indebtedness then unpaid which in no case shall be less than P100.00 exclusive of all fees allowed by law, and the expenses of collection shall be the obligation of the Mortgagor and shall with priority, be paid to the Mortgagee out of any sums realized as rents and profits derived from the mortgaged property or from the proceeds realized from the sale of the said property and this mortgage shall likewise stand as security therefor. . . .

We find the above stipulation to pay attorney's fees clear enough to cover both cases of foreclosure sale mentioned thereunder, i.e., judicially or extra-judicially. 

At any rate, we find merit in the contention of the appellant that the award of P5,821.35 in favor of the PNB as attorney's fees is unconscionable and unreasonable, considering that all that the branch attorney of the said bank did in connection with the foreclosure sale of the real property was to file a petition with the provincial sheriff of Camarines Norte requesting the latter to sell the same in accordance with the provisions of Act 3135.

The principle that courts should reduce stipulated attorney's fees whenever it is found under the circumstances of the case that the same is unreasonable, is now deeply rooted in this jurisdiction to entertain any serious objection to it. Thus, this Court has explained:

But the principle that it may be lawfully stipulated that the legal expenses involved in the collection of a debt shall be defrayed by the debtor does not imply that such stipulations must be enforced in accordance with the

terms, no matter how injurious or oppressive they may be. The lawful purpose to be accomplished by such a stipulation is to permit the creditor to receive the amount due him under his contract without a deduction of the expenses caused by the delinquency of the debtor. It should not be permitted for him to convert such a stipulation into a source of speculative profit at the expense of the debtor.

Contracts for attorney's services in this jurisdiction stands upon an entirely different footing from contracts for the payment of compensation for any other services. By express provision of section 29 of the Code of Civil Procedure, an attorney is not entitled in the absence of express contract to recover more than a reasonable compensation for his services; and even when an express contract is made the court can ignore it and limit the recovery to reasonable compensation if the amount of the stipulated fee is found by the court to be unreasonable. This is a very different rule from that announced in section 1091 of the Civil Code with reference to the obligation of contracts in general, where it is said that such obligation has the force of law between the contracting parties. Had the plaintiff herein made an express contract to pay his attorney an uncontingent fee of P2,115.25 for the services to be rendered in reducing the note here in suit to judgment, it would not have been enforced against him had he seen fit to oppose it, as such a fee is obviously far greater than is necessary to remunerate the attorney for the work involved and is therefore unreasonable. In order to enable the court to ignore an express contract for an attorney's fees, it is not necessary to show, as in other contracts, that it is contrary to morality or public policy (Art. 1255, Civil Code). It is enough that it is unreasonable or unconscionable. 4

Since then this Court has invariably fixed counsel fees on a quantum meruit basis whenever the fees stipulated appear excessive, unconscionable, or unreasonable, because a lawyer is primarily a court officer charged with the duty of assisting the court in administering impartial justice between the parties, and hence, the fees should be subject to judicial control. Nor should it be ignored that sound public policy demands that courts disregard stipulations for counsel fees, whenever they appear to be a source of speculative profit at the expense of the debtor or mortgagor. 5 And it is not material that the present action is between the debtor and the creditor, and not between attorney and client. As court have power to fix the fee as between attorney and client, it must necessarily have the right to say whether a stipulation like this, inserted in a mortgage contract, is valid. 6

In determining the compensation of an attorney, the following circumstances should be considered: the amount and character of the services rendered; the responsibility imposed; the amount of money or the value of the property affected by the controversy, or involved in the employment; the skill and experience called for in the performance of the service; the professional standing of the attorney; the results secured; and whether or not the fee is contingent or absolute, it being a recognized rule that an attorney may properly charge a much larger fee when it is to be contingent than when it is not. 7 From the stipulation in the mortgage contract earlier quoted, it appears that the agreed fee is 10% of the total indebtedness, irrespective of the manner the foreclosure of the mortgage is to be effected. The agreement is perhaps fair enough in case the foreclosure proceedings is prosecuted judicially but, surely, it is unreasonable when, as in this case, the mortgage was foreclosed extra-judicially, and all that the attorney did was to file a petition for foreclosure with the sheriff concerned. It is to be assumed though, that the said branch attorney of the PNB made a study of the case before deciding to file the petition for foreclosure; but even with this in mind, we

believe the amount of P5,821.35 is far too excessive a fee for such services. Considering the above circumstances mentioned, it is our considered opinion that the amount of P1,000.00 would be more than sufficient to compensate the work aforementioned.

Bautista vs Gonzales [A.M. No. 1625. February 12, 1990][Per Curiam]

FACTS:

In a verified complaint filed by Angel L. Bautista, respondent Ramon

A. Gonzales was charged with malpractice, deceit, gross misconduct

and violation of lawyer’s oath. Required by this Court to answer the

charges against him, respondent filed a motion for a bill of particulars

asking this Court to order complainant to amend his complaint by

making his charges more definite. In a resolution the Court granted

respondent’s motion and required complainant to file an amended

complaint. Complainant submitted an amended complaint for

disbarment, alleging that respondent committed the following acts:

1. Accepting a case wherein he agreed with his clients, namely,

Alfaro Fortunado, Nestor Fortunado and Editha Fortunado

[hereinafter referred to as the Fortunados] to pay all expenses,

including court fees, for a contingent fee of fifty percent (50%) of the

value of the property in litigation.

x x x

4. Inducing complainant, who was his former client, to enter into a

contract with him on August 30, 1971 for the development into a

residential subdivision of the land involved in Civil Case No. Q-

15143, covered by TCT No. T-1929, claiming that he acquired fifty

percent (50%) interest thereof as attorney’s fees from the

Fortunados, while knowing fully well that the said property was

already sold at a public auction on June 30, 1971, by the Provincial

Sheriff of Lanao del Norte and registered with the Register of Deeds

of Iligan City;

x x x

Pertinent to No. 4 above, the contract, in No. 1 above, reads:

We the [Fortunados] agree on the 50% contingent fee, provided, you

[respondent Ramon Gonzales] defray all expenses, for the suit,

including court fees.

ISSUE:

Whether or not respondent committed serious misconduct involving a

champertous contract.

HELD:

YES. Respondent was suspended from practice of law for six (6)

months.

RATIO:

The Court finds that the agreement between the respondent and the

Fortunados contrary to Canon 42 of the Canons of Professional

Ethics which provides that a lawyer may not properly agree with

a client to pay or bear the expenses of litigation. [See also Rule

16.04, Code of Professional Responsibility]. Although a lawyer may

in good faith, advance the expenses of litigation, the same

should be subject to reimbursement. The agreement between

respondent and the Fortunados, however, does not provide for

reimbursement to respondent of litigation expenses paid by him. An

agreement whereby an attorney agrees to pay expenses of

proceedings to enforce the client’s rights is champertous

[citation omitted]. Such agreements are against public policy

especially where, as in this case, the attorney has agreed to carry on

the action at his own expense in consideration of some bargain to

have part of the thing in dispute [citation omitted]. The execution of

these contracts violates the fiduciary relationship between the lawyer

and his client, for which the former must incur administrative

sanctions.

FRANCISCO RAYOS, Petitioner, vs.ATTY. PONCIANO G. HERNANDEZ, Respondent.

Facts:Respondent was the counsel of petitioner in Civil Case No. SM-951 entitled, "Francisco Rayos v. NAPOCOR," filed before the Regional Trial Court (RTC), Malolos, Bulacan. The complaint alleged, among other things, that the National Power Corporation (NAPOCOR) recklessly, imprudently and negligently opened the three floodgates

of the spillway of Angat Dam at midnight of 26 October 1978 until the early morning hours of 27 October 1978, during the occurrence of typhoon "Kading" causing the release of a great volume of stored water, the resultant swelling and flooding of Angat River, and the consequent loss of lives of some of petitioner’s relatives and destruction of his family’s properties, for which he sought damages. Of the 10 members of petitioner’s family who perished, only four bodies were recovered and only petitioner and one of his sons, German Rayos, survived.

In Civil Case No. SM-951, ordering NAPACOR to pay jointly and severally, plaintiff-appellant, with legal interest from the date when this decision shall have become final and executor.

In addition, in all the four (4) instant cases, ordering defendants-appellees to pay, jointly and severally, plaintiffs-appellants, attorney’s fees in an amount equivalent to 15% of the total amount awarded. 5

The case was appealed to this Court, which affirmed the Court of Appeals Decision. 6 The Decision of the Supreme Court became final and executory on 4 August 1993.

Thus, a Writ of Execution 7 was issued by the RTC on 10 December 1993, upon motion filed by respondent. As a consequence, NAPOCOR issued Check No. 014710 dated 5 January 1994, in the amount of P1,060,800.00 payable to petitioner. Thereafter, the check was turned over to respondent as counsel of petitioner. Petitioner demanded the turn over of the check from respondent, but the latter refused.

Petitioner sought to recover the check in the amount of P1,060,800.00 from respondent, claiming that respondent had no authority to receive the same as he was already dismissed by petitioner as his counsel on 21 November 1993. 9 Respondent, on the other hand, justifies his retention as a means to ensure payment of his attorney’s fees.

However, on 4 July 1994, respondent deposited the amount of P502,838.79 with Farmers Savings and Loan Bank, Inc., Norzagaray, Bulacan, in the name of petitioner which was eventually received by the latter.

Thus, petitioner initiated this complaint for disbarment for the failure of respondent to return the rest of the award in the amount of   P 557,961.21.

ISSUE: whether respondent is justified in retaining the amount awarded to petitioner in Civil Case No. SM-951 to assure payment of his attorney’s fees.

RULING: Moneys collected by an attorney on a judgment rendered in favor of his client constitute trust funds and must be immediately paid over to the client. 16 Canon 16 of the Code of Professional Responsibility provides as follows:

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.

In the case at bar, when respondent withheld and refused to deliver the NAPOCOR check representing the amount awarded by the court in Civil Case No. SM-951, which he received on behalf of his client (petitioner herein), he breached the trust reposed on him.

The claim of the respondent that petitioner failed to pay his attorney’s fees is not an excuse for respondent’s failure to deliver the amount to the petitioner. A lawyer is not entitled to unilaterally appropriate his client’s money for himself by the mere fact alone that the

client owes him attorney’s fees. The failure of an attorney 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 and violation of the general morality, as well as of professional ethics; it also impairs public confidence in the legal profession and deserves punishment. In short, a lawyer’s unjustified withholding of money belonging to his client, as in this case, warrants the imposition of disciplinary action. 

St. Louis Lab HS Faculty V De La Cruz

Facts: A disbarment case filed by the Faculty members and Staff of the Saint Louis University-Laboratory High School (SLU-LHS) against Atty. Rolando C. Dela Cruz, principal of SLU-LHS, predicated on the following grounds:

1. Gross misconduct- he has pending case of child abuse, administrative case and labor case. From the records of the case, it appears that there is a pending criminal case for child abuse allegedly committed by him against a high school student filed before the Prosecutor’s Office of Baguio City; a pending administrative case filed by the Teachers, Staff, Students and Parents before an Investigating Board created by SLU for his alleged unprofessional and unethical acts of misappropriating money supposedly for the teachers; and the pending labor case filed by SLU-LHS Faculty before the NLRC, Cordillera Administrative Region, on alleged illegal deduction of salary by respondent.

2. Grossly immoral conduct – contracting a second marriage despite the existence of his first marriage.3. Malpractice- notarizing documents despite the expiration of his commission.

Issue: May a pending case constitute facts that determine the existence of gross misconduct by the respondent?

Held: YES, The Practice of law is not a right but a privilege bestowed by the State on those who show that they possess the qualifications required by law. The purpose of suspending or disbarring an attorney is to remove from the profession those unfit to be entrusted with the duties and responsibilities thereby protecting the public and those charged with the administration of justice, rather than to punish an attorney.

Contracting a second marriage despite existence of first marriage is a violation of the continous possession of good moral character as a requirement to the enjoyment of the privilege of law practice.

The Court has characterized a lawyer’s act of notarizing documents without the requisite commission to do so as “reprehensible, constituting as it does not only malpractice but also the crime of falsification of public documents.” Notarization of a private document converts the document into a public one making it admissible in court without further proof of its authenticity. A notarial document is by law entitled to full faith and credit upon its face and, for this reason, notaries public must observe with the utmost care the basic requirements in the performance of their duties.

Pending case does not constitute facts that determines the existence of gross misconduct by the respondent as these are still pending before the proper forums. At such stages, the presumption of innocence still prevails in favor of the respondent.

WHEREFORE, finding respondent Atty. Rolando Dela Cruz guilty of immoral conduct, in disregard of the Code of Professional

Responsibility, he is hereby SUSPENDED from the practice of law for a period of two (2) years, and another two (2) years for notarizing documents despite the expiration of his commission or a total of four (4) years of suspension.