CANON 9 It is to be noted that we are not now considering an application for the suspension or removal of
the defendant Ney from his office as attorney. The defendant Bosque, not being an officer of the
G.R. No. 3593 March 23, 1907
THE UNITED STATES, plaintiff,
vs.
C.W. NEY and JUAN GARCIA BOSQUE, defendants.
Attorney-General Araneta for plaintiff.
C.W. Ney for defendants.
TRACEY, J.:
This proceeding is to punish the defendants for contempt.
In the year 1902 this court decided that the defendant, J. Garcia Bosque, was not entitled to
admission to practice law in the Philippine Islands, upon the ground that after the change of
sovereignty he had elected to remain a Spanish subject and as such was not qualified for
admission to the bar (In re Bosque, 1 Phil. Rep., 88), and an order was entered accordingly.
In the year 1904 he made an arrangement with the defendant Ney, a practicing attorney, to carry
on business together, sending out a circular signed "Ney & Bosque," stating that they had
established an office for the general practice of law in all the courts of the Islands and that
Bosque would devote himself especially to consultation and office work relating to Spanish law.
The paper was headed "Law Office — Ney & Bosque. Juan G. Bosque,jurisconsulto español —
C.W. Ney, abogado americano."
Since that time the defendant Bosque has not personally appeared in the courts, and with one
exception, occuring through an inadvertance, papers from the office were signed not with the
firm name alone nor with any designation of the firm as attorneys, but with the words "Ney &
Bosque — C.W. Ney, abogado."
On two occasions, one on May 1, 1905, and the other on September 15, 1906, this court refused
to consider petitions so singed with the names of the defendants and the practice being
repeated, on the 2nd day of October, 1906, ordered the papers sent to the Attorney-General to
take appropriate action thereon, and he thereupon instituted this proceeding.
The defendants disclaim any intentional contempt, and defend their acts as being within the law.
Section 102 of the Code of Civil procedure, providing that every pleading must be subscribed by
the party or his attorney, does not permit, and by implication prohibits, a subscription of the
names of any other persons, whether agents or otherwise; therefore a signature containing the
name of one neither a party nor an attorney was not a compliance with this section, nor was it
aided by the too obvious subterfuge of the addition of the individual name of a licensed attorney.
The illegality in this instance was aggravated by the fact that one of the agents so named was a
person residing in these Islands to whom this court had expressly denied admission to the bar.
The papers in question were irregular and were properly rejected. We refuse to recognize as a
practice any signature of names appended to pleadings or other papers in an action other than
those specified in the statute. A signature by agents amounts to a signing by non-qualified
attorneys, the office of attorney being originally one of agency. (In re Cooper, 22 N.Y., 67.) We
do not, however, mean to discountenance the use of a suitable firm designation by partners, all
of whom have been duly admitted to practice.
court, could not be proceeded against in that way, and probably for that reason the Attorney-
General instituted this form of proceeding.
Should either of these defendants be thus punished for contempt?
Section 232 of the Code of Civil Procedure describes contempt as follows:
1. Disobedience of or resistance to a lawful writ, process, order, judgment, or
command of a court, or injunction granted by a court or judge;
2. Misbehavior of an officer of the court in the performance of his official duties or in
his official transactions.
Where the law defines contempt, the power of the courts is restricted to punishment for acts so
defined. (Ex parteRobinson, 86 U.S., 505.)
As to the first subdivision of this section, no direct order or command of this court has been
disobeyed or resisted by the defendant Ney. The only order that the defendant Bosque can have
disobeyed is the one denying him the right to practice law. This order, however, was directly
binding upon him, notwithstanding proceedings taken for its review, and any hope on his part of
ultimately reversing it furnished no excuse for its violation. Even had he been entitled under the
statute to practice law without any license from the court and without an application to it, yet its
order made on his own petition. A mandate of the court, while in force, must be obeyed. The
irregular signature to papers, though affixed by his associate, had his authorization and
constitutes a substantial attempt to engage in practice. Moreover the firm circular in setting forth
the establishment of an office for the general practice of law in all the courts of the Islands,
amounted to an assertion of his right and purpose, not effectively qualified by the addition that
he would devote himself to consultation and office work relating to Spanish law. Spanish law
plays an important part in the equipment of a lawyer in the Archipelago, standing on a different
footing from the law of other foreign countries, in regard to which a skilled person might as a
calling, advise without practicing law. The fact stated on the circular that he was a Spanish
lawyer did not amount to a disclaimer of his professional character in the Islands. Independent of
statutory provisions, a foreigner is not by reason of his status disqualified from practicing law.
One of the most eminent American advocates was an alien barrister admitted to the bar after a
contest in the court of New York State. (In re Thomas Addis Emmett, 2 Cain's Cases, 386.)
Consequently the conduct of the defendant Bosque amounts to disobedience of an order made
in a proceeding to which he was a party.
Under the second subdivision of the section cited, Bosque is obviously not answerable,
inasmuch as he was not an officer of the court. On the other hand, under this subdivision, the
defendant Ney, as an admitted attorney, is liable if his conduct amounted to misbehavior. We
are of the opinion that it did. In the offense of Bosque in holding himself out as a general
practitioner Ney participated, and for the improper signature of the pleadings he was chiefly and
personally responsible. It is impossible to say that the signature itself was a violation of the law,
and yet hold guiltless the man who repeatedly wrote it. Moreover we regret to add that his
persistent and rash disregard of the rulings of the court has not commended him to our
indulgence, while the offensive character of certain papers recently filed by him forbids us from
presuming on the hope of his voluntarily conforming to the customary standard of members of
the bar.
The judgment of the court is that each of the defendants is fined in the sum of 200 pesos, to be
paid into the office of the clerk of this court within ten days, with the costs de oficio. So ordered.
A.C. No. 9604 March 20, 2013
RODRIGO E. TAPAY and ANTHONY J. RUSTIA, Complainants,
vs.
ATTY. CHARLIE L. BANCOLO and ATTY. JANUS T. JARDER, Respondents.
DECISION
CARPIO, J.:
The Case
This administrative case arose from a Complaint tiled by Rodrigo E. Tapay (Tapay) and Anthony
J. Rustia (Rustia), both employees of the Sugar Regulatory Administration, against Atty. Charlie
L. Bancolo (Atty. Bancolo) and Atty. Janus T. larder (Atty. Jarder) for violation of the Canons of
Ethics and Professionalism, Falsification of Public Document, Gross Dishonesty, and
Harassment.
The Facts
Sometime in October 2004, Tapay and Rustia received an Order dated 14 October 2004 from
the Office of the Ombudsman-Visayas requiring them to file a counter-affidavit to a complaint for
usurpation of authority, falsification of public document, and graft and corrupt practices filed
against them by Nehimias Divinagracia, Jr. (Divinagracia), a co-employee in the Sugar
Regulatory Administration. The Complaint1 dated 31 August 2004 was allegedly signed on
behalf of Divinagracia by one Atty. Charlie L. Bancolo of the Jarder Bancolo Law Office based in
Bacolod City, Negros Occidental.
When Atty. Bancolo and Rustia accidentally chanced upon each other, the latter informed Atty.
Bancolo of the case filed against them before the Office of the Ombudsman. Atty. Bancolo
denied that he represented Divinagracia since he had yet to meet Divinagracia in person. When
Rustia showed him the Complaint, Atty. Bancolo declared that the signature appearing above his
name as counsel for Divinagracia was not his. Thus, Rustia convinced Atty. Bancolo to sign an
affidavit to attest to such fact. On 9 December 2004, Atty. Bancolo signed an affidavit denying
his supposed signature appearing on the Complaint filed with the Office of the Ombudsman and
submitted six specimen signatures for comparison. Using Atty. Bancolo’s affidavit and other
documentary evidence, Tapay and Rustia filed a counter-affidavit accusing Divinagracia of
falsifying the signature of his alleged counsel, Atty. Bancolo.
In a Resolution dated 28 March 2005, the Office of the Ombudsman provisionally dismissed the
Complaint since the falsification of the counsel’s signature posed a prejudicial question to the
Complaint’s validity. Also, the Office of the Ombudsman ordered that separate cases for
Falsification of Public Document2 and Dishonesty3 be filed against Divinagracia, with Rustia and
Atty. Bancolo as complainants.
Thereafter, Divinagracia filed his Counter-Affidavit dated 1 August 2005 denying that he falsified
the signature of his former lawyer, Atty. Bancolo. Divinagracia presented as evidence an affidavit
dated 1 August 2005 by Richard A. Cordero, the legal assistant of Atty. Bancolo, that the Jarder
Bancolo Law Office accepted Divinagracia’s case and that the Complaint filed with the Office of
the Ombudsman was signed by the office secretary per Atty. Bancolo’s instructions. Divinagracia
asked that the Office of the Ombudsman dismiss the cases for falsification of public document
and dishonesty filed against him by Rustia and Atty. Bancolo and to revive the original Complaint
for various offenses that he filed against Tapay and Rustia.
In a Resolution dated 19 September 2005, the Office of the Ombudsman dismissed the criminal
case for falsification of public document (OMB-V-C-05-0207-E) for insufficiency of evidence. The
dispositive portion states:
WHEREFORE, the instant case is hereby DISMISSED for insufficiency of evidence, without
prejudice to the re-filing by Divinagracia, Jr. of a proper complaint for violation of RA 3019 and
other offenses against Rustia and Tapay.
SO ORDERED.4
The administrative case for dishonesty (OMB-V-A-05-0219-E) was also dismissed for lack of
substantial evidence in a Decision dated 19 September 2005.
On 29 November 2005, Tapay and Rustia filed with the Integrated Bar of the Philippines (IBP) a
complaint5 to disbar Atty. Bancolo and Atty. Jarder, Atty. Bancolo’s law partner. The
complainants alleged that they were subjected to a harassment Complaint filed before the Office
of the Ombudsman with the forged signature of Atty. Bancolo. Complainants stated further that
the signature of Atty. Bancolo in the Complaint was not the only one that was forged.
Complainants attached a Report6 dated 1 July 2005 by the Philippine National Police Crime
Laboratory 6 which examined three other letter-complaints signed by Atty. Bancolo for other
clients, allegedly close friends of Atty. Jarder. The report concluded that the questioned
signatures in the letter-complaints and the submitted standard signatures of Atty. Bancolo were
not written by one and the same person. Thus, complainants maintained that not only were
respondents engaging in unprofessional and unethical practices, they were also involved in
falsification of documents used to harass and persecute innocent people.
On 9 January 2006, complainants filed a Supplement to the Disbarment Complaint Due to
Additional Information. They alleged that a certain Mary Jane Gentugao, the secretary of the
Jarder Bancolo Law Office, forged the signature of Atty. Bancolo.
In their Answer dated 26 January 2006 to the disbarment complaint, respondents admitted that
the criminal and administrative cases filed by Divinagracia against complainants before the
Office of the Ombudsman were accepted by the Jarder Bancolo Law Office. The cases were
assigned to Atty. Bancolo. Atty. Bancolo alleged that after being informed of the assignment of
the cases, he ordered his staff to prepare and draft all the necessary pleadings and documents.
However, due to some minor lapses, Atty. Bancolo permitted that the pleadings and
communications be signed in his name by the secretary of the law office. Respondents added
that complainants filed the disbarment complaint to retaliate against them since the cases filed
before the Office of the Ombudsman were meritorious and strongly supported by testimonial and
documentary evidence. Respondents also denied that Mary Jane Gentugao was employed as
secretary of their law office.
Tapay and Rustia filed a Reply to the Answer dated 2 March 2006. Thereafter, the parties were
directed by the Commission on Bar Discipline to attend a mandatory conference scheduled on 5
May 2006. The conference was reset to 10 August 2006. On the said date, complainants were
present but respondents failed to appear. The conference was reset to 25 September 2006 for
the last time. Again, respondents failed to appear despite receiving notice of the conference.
Complainants manifested that they were submitting their disbarment complaint based on the
documents submitted to the IBP. Respondents were also deemed to have waived their right to
participate in the mandatory conference. Further, both parties were directed to submit their
respective position papers. On 27 October 2006, the IBP received complainants’ position paper
dated 18 October 2006 and respondents’ position paper dated 23 October 2006.
The IBP’s Report and Recommendation
On 11 April 2007, Atty. Lolita A. Quisumbing, the Investigating Commissioner of the Commission
on Bar Discipline of the IBP, submitted her Report. Atty. Quisumbing found that Atty. Bancolo
violated Rule 9.01 of Canon 9 of the Code of Professional Responsibility while Atty. Jarder
violated Rule 1.01 of Canon 1 of the same Code. The Investigating
Commissioner recommended that Atty. Bancolo be suspended for two years from the practice of
law and Atty. Jarder be admonished for his failure to exercise certain responsibilities in their law
firm.
In her Report and Recommendation, the Investigating Commissioner opined:
x x x. In his answer, respondent Atty. Charlie L. Bancolo admitted that his signature appearing in
the complaint filed against complainants’ Rodrigo E. Tapay and Anthony J. Rustia with the
Ombudsman were signed by the secretary. He did not refute the findings that his signatures
appearing in the various documents released from his office were found not to be his. Such
pattern of malpratice by respondent clearly breached his obligation under Rule 9.01 of Canon 9,
for a lawyer who allows a non-member to represent him is guilty of violating the aforementioned
Canon. The fact that respondent was busy cannot serve as an excuse for him from signing
personally. After all respondent is a member of a law firm composed of not just one (1) lawyer.
The Supreme Court has ruled that this practice constitute negligence and undersigned finds the
act a sign of indolence and ineptitude. Moreover, respondents ignored the notices sent by
undersigned. That showed patent lack of respect to the Integrated Bar of the Philippines’
Commission on Bar Discipline and its proceedings. It betrays lack of courtesy and irresponsibility
as lawyers.
On the other hand, Atty. Janus T. Jarder, a senior partner of the law firm Jarder Bancolo and
Associates Law Office, failed to exercise certain responsibilities over matters under the charge
of his law firm. As a senior partner[,] he failed to abide to the principle of "command
responsibility". x x x.
xxxx
Respondent Atty. Janus Jarder after all is a seasoned practitioner, having passed the bar in
1995 and practicing law up to the present. He holds himself out to the public as a law firm
designated as Jarder Bancolo and Associates Law Office. It behooves Atty. Janus T. Jarder to
exert ordinary diligence to find out what is going on in his law firm, to ensure that all lawyers in
his firm act in conformity to the Code of Professional Responsibility. As a partner, it is his
responsibility to provide efficacious control of court pleadings and other documents that carry the
name of the law firm. Had he done that, he could have known the unethical practice of his law
partner Atty. Charlie L. Bancolo. Respondent Atty. Janus T. Jarder failed to perform this task and
is administratively liable under Canon 1, Rule 1.01 of the Code of Professional Responsibility. 7
On 19 September 2007, in Resolution No. XVIII-2007-97, the Board of Governors of the IBP
approved with modification the Report and Recommendation of the Investigating Commissioner.
The Resolution states:
RESOLVED to ADOPT and APPROVE, as it is hereby ADOPTED and APPROVED, with
modification, the Report and Recommendation of the Investigating Commissioner of the above-
entitled case, herein made part of this Resolution as Annex "A"; and, finding the
recommendation fully supported by the evidence on record and the applicable laws and rules,
and considering Respondent Atty. Bancolo’s violation of Rule 9.01, Canon 9 of the Code of
Professional Responsibility, Atty. Charlie L. Bancolo is hereby SUSPENDED from the practice of
law for one (1) year.
However, with regard to the charge against Atty. Janus T. Jarder, the Board of Governors
RESOLVED as it is hereby RESOLVED to AMEND, as it is hereby AMENDED the
Recommendation of the Investigating Commissioner, and APPROVE the DISMISSAL of the
case for lack of merit.8
Tapay and Rustia filed a Motion for Reconsideration. Likewise, Atty. Bancolo filed his Motion for
Reconsideration dated 22 December 2007. Thereafter, Atty. Jarder filed his separate
Consolidated Comment/Reply to Complainants’ Motion for Reconsideration and Comment Filed
by Complainants dated 29 January 2008.
In Resolution No. XX-2012-175 dated 9 June 2012, the IBP Board of Governors denied both
complainants’ and Atty. Bancolo’s motions for reconsideration. The IBP Board found no cogent
reason to reverse the findings of the Investigating Commissioner and affirmed Resolution No.
XVIII-2007-97 dated 19 September 2007.
The Court’s Ruling
After a careful review of the records of the case, we agree with the findings and recommendation
of the IBP Board and find reasonable grounds to hold respondent Atty. Bancolo administratively
liable.
Atty. Bancolo admitted that the Complaint he filed for a former client before the Office of the
Ombudsman was signed in his name by a secretary of his law office. Clearly, this is a violation of
Rule 9.01 of Canon 9 of the Code of Professional Responsibility, which provides:
CANON 9
A LAWYER SHALL NOT, DIRECTLY OR INDIRECTLY, ASSIST IN THE UNAUTHORIZED
PRACTICE OF LAW.
Rule 9.01 - A lawyer shall not delegate to any unqualified person the performance of any task
which by law may only be performed by a member of the Bar in good standing.
This rule was clearly explained in the case of Cambaliza v. Cristal-Tenorio,9 where we held:
The lawyer’s duty to prevent, or at the very least not to assist in, the unauthorized practice of law
is founded on public interest and policy. Public policy requires that the practice of law be limited
to those individuals found duly qualified in education and character. The permissive right
conferred on the lawyer is an individual and limited privilege subject to withdrawal if he fails to
maintain proper standards of moral and professional conduct. The purpose is to protect the
public, the court, the client, and the bar from the incompetence or dishonesty of those
unlicensed to practice law and not subject to the disciplinary control of the Court. It devolves
upon a lawyer to see that this purpose is attained. Thus, the canons and ethics of the profession
enjoin him not to permit his professional services or his name to be used in aid of, or to make
possible the unauthorized practice of law by, any agency, personal or corporate. And, the law
makes it a misbehavior on his part, subject to disciplinary action, to aid a layman in the
unauthorized practice of law.
In Republic v. Kenrick Development Corporation,10 we held that the preparation and signing of a
pleading constitute legal work involving the practice of law which is reserved exclusively for
members of the legal profession. Atty. Bancolo’s authority and duty to sign a pleading are
personal to him. Although he may delegate the signing of a pleading to another lawyer, he may
not delegate it to a non-lawyer. Further, under the Rules of Court, counsel’s signature serves as
a certification that (1) he has read the pleading; (2) to the best of his knowledge, information and
belief there is good ground to support it; and (3) it is not interposed for delay. 11 Thus, by affixing
one’s signature to a pleading, it is counsel alone who has the responsibility to certify to these
matters and give legal effect to the document.1âwphi1
In his Motion for Reconsideration dated 22 December 2007, Atty. Bancolo wants us to believe
that he was a victim of circumstances or of manipulated events because of his unconditional
trust and confidence in his former law partner, Atty. Jarder. However, Atty. Bancolo did not take
any steps to rectify the situation, save for the affidavit he gave to Rustia denying his signature to
the Complaint filed before the Office of the Ombudsman. Atty. Bancolo had an opportunity to
maintain his innocence when he filed with the IBP his Joint Answer (with Atty. Jarder) dated 26
January 2006. Atty. Bancolo, however, admitted that prior to the preparation of the Joint Answer,
Atty. Jarder threatened to file a disbarment case against him if he did not cooperate. Thus, he
was constrained to allow Atty. Jarder to prepare the Joint Answer. Atty. Bancolo simply signed
the verification without seeing the contents of the Joint Answer.
In the Answer, Atty. Bancolo categorically stated that because of some minor lapses, the
communications and pleadings filed against Tapay and Rustia were signed by his secretary,
albeit with his tolerance. Undoubtedly, Atty. Bancolo violated the Code of Professional
Responsibility by allowing a non-lawyer to affix his signature to a pleading. This violation Is an
act of falsehood which IS a ground for disciplinary action.
The complainants did not present any evidence that Atty. Jarder was directly involved, had
knowledge of, or even participated in the wrongful practice of Atty. Bancolo in allowing or
tolerating his secretary to sign pleadings for him. Thus, we agree with the finding of the IBP
Board that Atty. Jarder is not administratively liable.
In sum, we find that the suspension of Atty. Bancolo from the practice of law for one year is
warranted. We also find proper the dismissal of the case against Atty. larder.
WHEREFORE, we DISMISS the complaint against Atty. Janus T. larder for lack of merit.
We find respondent Atty. Charlie L. Bancolo administratively liable for violating Rule 9.01 of
Canon 9 of the Code of Professional Responsibility. He is hereby SUSPENDED from the
practice of law for one year effective upon finality of this Decision. He is warned that a repetition
of the same or similar acts in the future shall be dealt with more severely.
Let a copy of this Decision be attached to respondent Atty. Charlie L. Bancolo's record in this
Court as attorney. Further, let copies of this Decision be furnished to the Integrated Bar of the
Philippines and the Office of the Court Administrator, which is directed to circulate them to all the
courts in the country for their information and guidance.
SO ORDERED.
[A.M. SDC-97-2-P. February 24, 1997]
SOPHIA ALAWI, complainant, vs. ASHARY M. ALAUYA, Clerk of Court VI, Shari'a District
Court, Marawi City, respondent.
DECISION
NARVASA, C.J.:
Sophia Alawi was (and presumably still is) a sales representative (or coordinator) of E. B.
Villarosa & Partners Co., Ltd. of Davao City, a real estate and housing company. Ashari M.
Alauya is the incumbent executive clerk of court of the 4th Judicial Shari'a District in Marawi City.
They were classmates, and used to be friends.
It appears that through Alawi's agency, a contract was executed for the purchase on
installments by Alauya of one of the housing units belonging to the above mentioned firm
(hereafter, simply Villarosa & Co.); and in connection therewith, a housing loan was also granted
to Alauya by the National Home Mortgage Finance Corporation (NHMFC).
Not long afterwards, or more precisely on December 15, 1995, Alauya addressed a letter
to the President of Villarosa & Co. advising of the termination of his contract with the company.
He wrote:
" ** I am formally and officially withdrawing from and notifying you of my intent to terminate the
Contract/Agreement entered into between me and your company, as represented by your Sales
Agent/Coordinator, SOPHIA ALAWI, of your company's branch office here in Cagayan de Oro
City, on the grounds that my consent was vitiated by gross misrepresentation, deceit, fraud,
dishonesty and abuse of confidence by the aforesaid sales agent which made said contract
void ab initio. Said sales agent acting in bad faith perpetrated such illegal and unauthorized acts
which made said contract an Onerous Contract prejudicial to my rights and interests."
He then proceeded to expound in considerable detail and quite acerbic language on the
"grounds which could evidence the bad faith, deceit, fraud, misrepresentation, dishonesty and
abuse of confidence by the unscrupulous sales agent ** ;" and closed with the plea that Villarosa
& Co. "agree for the mutual rescission of our contract, even as I inform you that I categorically
state on record that I am terminating the contract **. I hope I do not have to resort to any legal
action before said onerous and manipulated contract against my interest be annulled. I was
actually fooled by your sales agent, hence the need to annul the controversial contract."
Alauya sent a copy of the letter to the Vice-President of Villarosa & Co. at San Pedro,
Gusa, Cagayan de Oro City. The envelope containing it, and which actually went through the
post, bore no stamps. Instead at the right hand corner above the description of the addressee,
the words, "Free Postage PD 26," had been typed.
On the same date, December 15, 1995, Alauya also wrote to Mr. Fermin T. Arzaga, Vice-
President, Credit & Collection Group of the National Home Mortgage Finance Corporation
(NHMFC) at Salcedo Village, Makati City, repudiating as fraudulent and void his contract with
Villarosa & Co.; and asking for cancellation of his housing loan in connection therewith, which
was payable from salary deductions at the rate of P4,338.00 a month. Among other things, he
said:
" ** (T)hrough this written notice, I am terminating, as I hereby annul, cancel, rescind and voided,
the 'manipulated contract' entered into between me and the E.B. Villarosa & Partner Co., Ltd., as
represented by its sales agent/coordinator, SOPHIA ALAWI, who maliciously and fraudulently
manipulated said contract and unlawfully secured and pursued the housing loan without my
authority and against my will. Thus, the contract itself is deemed to be void ab initio in view of
the attending circumstances, that my consent was vitiated by misrepresentation, fraud, deceit,
dishonesty, and abuse of confidence; and that there was no meeting of the minds between me
and the swindling sales agent who concealed the real facts from me."
And, as in his letter to Villarosa & Co., he narrated in some detail what he took to be the
anomalous actuations of Sophia Alawi.
Alauya wrote three other letters to Mr. Arzaga of the NHMFC, dated February 21, 1996,
April 15, 1996, and May 3, 1996, in all of which, for the same reasons already cited, he insisted
on the cancellation of his housing loan and discontinuance of deductions from his salary on
account thereof.a He also wrote on January 18, 1996 to Ms. Corazon M. Ordoez, Head of the
Fiscal Management & Budget Office, and to the Chief, Finance Division, both of this Court, to
stop deductions from his salary in relation to the loan in question, again asserting the anomalous
manner by which he was allegedly duped into entering into the contracts by "the scheming sales
agent."b
The upshot was that in May, 1996, the NHMFC wrote to the Supreme Court requesting it
to stop deductions on Alauya's UHLP loan "effective May 1996," and began negotiating with
Villarosa & Co. "for the buy-back of ** (Alauya's) mortgage, and ** the refund of ** (his)
payments."c
On learning of Alauya's letter to Villarosa & Co. of December 15, 1995, Sophia Alawi filed
with this Court a verified complaint dated January 25, 1996 -- to which she appended a copy of
the letter, and of the above mentioned envelope bearing the typewritten words, "Free Postage
PD 26."[1] In that complaint, she accused Alauya of:
1. "Imputation of malicious and libelous charges with no solid grounds through manifest
ignorance and evident bad faith;"
2. "Causing undue injury to, and blemishing her honor and established reputation;"
3. "Unauthorized enjoyment of the privilege of free postage **;" and
4. Usurpation of the title of "attorney," which only regular members of the Philippine Bar may
properly use.
She deplored Alauya's references to her as "unscrupulous, swindler, forger, manipulator,
etc." without "even a bit of evidence to cloth (sic) his allegations with the essence of truth,"
denouncing his imputations as irresponsible, "all concoctions, lies, baseless and coupled with
manifest ignorance and evident bad faith," and asserting that all her dealings with Alauya had
been regular and completely transparent. She closed with the plea that Alauya "be dismissed
from the service, or be appropriately disciplined (sic) ** "
The Court resolved to order Alauya to comment on the complaint. Conformably with
established usage that notices of resolutions emanate from the corresponding Office of the Clerk
of Court, the notice of resolution in this case was signed by Atty. Alfredo P. Marasigan, Assistant
Division Clerk of Court.[2]
Alauya first submitted a "Preliminary Comment"[3] in which he questioned the authority of
Atty. Marasigan to require an explanation of him, this power pertaining, according to him, not to
"a mere Asst. Div. Clerk of Court investigating an Executive Clerk of Court." but only to the
District Judge, the Court Administrator or the Chief Justice, and voiced the suspicion that the
Resolution was the result of a "strong link" between Ms. Alawi and Atty. Marasigan's office. He
also averred that the complaint had no factual basis; Alawi was envious of him for being not only
"the Executive Clerk of court and ex-officio Provincial Sheriff and District Registrar," but also "a
scion of a Royal Family **."[4]
In a subsequent letter to Atty. Marasigan, but this time in much less aggressive, even
obsequious tones,[5] Alauya requested the former to give him a copy of the complaint in order
that he might comment thereon.[6] He stated that his acts as clerk of court were done in good
faith and within the confines of the law; and that Sophia Alawi as sales agent of Villarosa & Co.
had, by falsifying his signature, fraudulently bound him to a housing loan contract entailing
monthly deductions of P4,333.10 from his salary.
And in his comment thereafter submitted under date of June 5, 1996, Alauya contended
that it was he who had suffered "undue injury, mental anguish, sleepless nights, wounded
feelings and untold financial suffering," considering that in six months, a total of P26,028.60 had
been deducted from his salary.[7] He declared that there was no basis for the complaint; in
communicating with Villarosa & Co. he had merely acted in defense of his rights. He denied any
abuse of the franking privilege, saying that he gave P20.00 plus transportation fare to a
subordinate whom he entrusted with the mailing of certain letters; that the words: "Free Postage
PD 26," were typewritten on the envelope by some other person, an averment corroborated by
the affidavit of Absamen C. Domocao, Clerk IV (subscribed and sworn to before respondent
himself, and attached to the comment as Annex J); [8] and as far as he knew, his subordinate
mailed the letters with the use of the money he had given for postage, and if those letters were
indeed mixed with the official mail of the court, this had occurred inadvertently and because of
an honest mistake.[9]
Alauya justified his use of the title, "attorney," by the assertion that it is "lexically
synonymous" with "Counsellors-at-law," a title to which Shari'a lawyers have a rightful claim,
adding that he prefers the title of "attorney" because "counsellor" is often mistaken for
"councilor," "konsehal or the Maranao term "consial," connoting a local legislator beholden to the
mayor. Withal, he does not consider himself a lawyer.
He pleads for the Court's compassion, alleging that what he did "is expected of any man
unduly prejudiced and injured."[10] He claims he was manipulated into reposing his trust in Alawi,
a classmate and friend.[11] He was induced to sign a blank contract on Alawi's assurance that
she would show the completed document to him later for correction, but she had since avoided
him; despite "numerous letters and follow-ups" he still does not know where the property --
subject of his supposed agreement with Alawi's principal, Villarosa & Co. -- is situated;[12] He
says Alawi somehow got his GSIS policy from his wife, and although she promised to return it
the next day, she did not do so until after several months. He also claims that in connection with
his contract with Villarosa & Co., Alawi forged his signature on such pertinent documents as
those regarding the down payment, clearance, lay-out, receipt of the key of the house, salary
deduction, none of which he ever saw.[13]
Averring in fine that his acts in question were done without malice, Alauya prays for the
dismissal of the complaint for lack of merit, it consisting of "fallacious, malicious and baseless
allegations," and complainant Alawi having come to the Court with unclean hands, her complicity
in the fraudulent housing loan being apparent and demonstrable.
It may be mentioned that in contrast to his two (2) letters to Assistant Clerk of Court
Marasigan (dated April 19, 1996 and April 22, 1996), and his two (2) earlier letters both dated
December 15, 1996 -- all of which he signed as "Atty. Ashary M. Alauya" -- in his Comment of
June 5, 1996, he does not use the title but refers to himself as "DATU ASHARY M. ALAUYA."
The Court referred the case to the Office of the Court Administrator for evaluation, report
and recommendation.[14]
The first accusation against Alauya is that in his aforesaid letters, he made "malicious and
libelous charges (against Alawi) with no solid grounds through manifest ignorance and evident
bad faith," resulting in "undue injury to (her) and blemishing her honor and established
reputation." In those letters, Alauya had written inter alia that:
1) Alawi obtained his consent to the contracts in question "by gross misrepresentation, deceit,
fraud, dishonesty and abuse of confidence;"
2) Alawi acted in bad faith and perpetrated ** illegal and unauthorized acts ** ** prejudicial to **
(his) rights and interests;"
3) Alawi was an "unscrupulous (and "swindling") sales agent" who had fooled him by "deceit,
fraud, misrepresentation, dishonesty and abuse of confidence;" and
4) Alawi had maliciously and fraudulently manipulated the contract with Villarosa & Co., and
unlawfully secured and pursued the housing loan without ** (his) authority and against ** (his)
will," and "concealed the real facts **."
 Alauya's defense essentially is that in making these statements, he was merely acting in
defense of his rights, and doing only what "is expected of any man unduly prejudiced and
injured," who had suffered "mental anguish, sleepless nights, wounded feelings and untold
financial suffering," considering that in six months, a total of P26,028.60 had been deducted from
his salary.[15]
The Code of Conduct and Ethical Standards for Public Officials and Employees (RA
6713) inter aliaenunciates the State policy of promoting a high standard of ethics and utmost
responsibility in the public service.[16] Section 4 of the Code commands that "(p)ublic officials and
employees ** at all times respect the rights of others, and ** refrain from doing acts contrary to
law, good morals, good customs, public policy, public order, public safety and public
interest."[17] More than once has this Court emphasized that "the conduct and behavior of every
official and employee of an agency involved in the administration of justice, from the presiding
judge to the most junior clerk, should be circumscribed with the heavy burden of responsibility.
Their conduct must at all times be characterized by, among others, strict propriety and decorum
so as to earn and keep the respect of the public for the judiciary." [18]
Now, it does not appear to the Court consistent with good morals, good customs or public
policy, or respect for the rights of others, to couch denunciations of acts believed -- however
sincerely -- to be deceitful, fraudulent or malicious, in excessively intemperate. insulting or
virulent language. Alauya is evidently convinced that he has a right of action against Sophia
Alawi. The law requires that he exercise that right with propriety, without malice or
vindictiveness, or undue harm to anyone; in a manner consistent with good morals, good
customs, public policy, public order, supra; or otherwise stated, that he "act with justice, give
everyone his due, and observe honesty and good faith."[19] Righteous indignation, or vindication
of right cannot justify resort to vituperative language, or downright name-calling. As a member of
the Shari'a Bar and an officer of a Court, Alawi is subject to a standard of conduct more stringent
than for most other government workers. As a man of the law, he may not use language which is
abusive, offensive, scandalous, menacing, or otherwise improper. [20] As a judicial employee, it is
expected that he accord respect for the person and the rights of others at all times, and that his
every act and word should be characterized by prudence, restraint, courtesy, dignity. His radical
deviation from these salutary norms might perhaps be mitigated, but cannot be excused, by his
strongly held conviction that he had been grievously wronged.
As regards Alauya's use of the title of "Attorney," this Court has already had occasion to
declare that persons who pass the Shari'a Bar are not full-fledged members of the Philippine
Bar, hence may only practice law before Shari'a courts.[21] While one who has been admitted to
the Shari'a Bar, and one who has been admitted to the Philippine Bar, may both be considered
"counsellors," in the sense that they give counsel or advice in a professional capacity, only the
latter is an "attorney." The title of "attorney" is reserved to those who, having obtained the
necessary degree in the study of law and successfully taken the Bar Examinations, have been
admitted to the Integrated Bar of the Philippines and remain members thereof in good standing;
and it is they only who are authorized to practice law in this jurisdiction.
Alauya says he does not wish to use the title, "counsellor" or "counsellor-at-law," because
in his region, there are pejorative connotations to the term, or it is confusingly similar to that
given to local legislators. The ratiocination, valid or not, is of no moment. His disinclination to use
the title of "counsellor" does not warrant his use of the title of attorney.
Finally, respecting Alauya's alleged unauthorized use of the franking privilege, the record
contains no evidence adequately establishing the accusation.
WHEREFORE, respondent Ashari M. Alauya is hereby REPRIMANDED for the use of
excessively intemperate, insulting or virulent language, i.e., language unbecoming a judicial
officer, and for usurping the title of attorney; and he is warned that any similar or other
impropriety or misconduct in the future will be dealt with more severely.
SO ORDERED.
G.R. No. L-46537 July 29, 1977
JOSE GUBALLA, petitioner,
vs.
THE HON. EDUARDO P. CAGUIOA, RICARDO G. CARLOS and DOMINGO FORTEZA,
JR., respondents.
SANTOS, J:
In this petition for certiorari with Preliminary Injunction, petitioner seeks to set aside the Order of
respondent Judge dated July 12, 1977, denying his Petition for Relief from Judgment and
allowing a writ of execution to issue in Civil Case No. 680-V of the Court of First Instance of
Bulacan.
The factual antecedents may be recited as follows:
Petitioner is an operator of a public utility vehicle which was involved, on October 1, 1971, in an
accident resulting to injuries sustained by private respondent Domingo Forteza Jr. As a
consequence thereof, a complaint for damages was filed by Forteza against petitioner with the
Court of First Instance of Bulacan (Branch VIII), docketed as Civil Case No. 680-V. An Answer
thereto was filed on behalf of petitioner by Irineo W. Vida Jr., of the law firm of Vida Enriquez,
Mercado & Associates. 1
Because petitioner and counsel failed to appear at the pretrial conference on April 6, 1972,
despite due notice, petitioner was treated as in default and private respondent was allowed to
present his evidence ex parte. A decision was thereafter rendered by the trial court in favor of
private respondent Forteza Jr. A Motion for Reconsideration was then filed by petitioner seeking
the lifting of the order of default, the reopening of the case for the presentation of his evidence
and the setting aside of the decision. Said Motion for Reconsideration was signed by Ponciano
Mercado, another member of the law firm. The same was denied by the lower Court and
petitioner appealed to the Court of Appeals assigning the following alleged errors, to wit:
a. That the Hon. Court erred in denying defendant Jose Guballa his day in
Court by declaring him in default, it being contrary to applicable law and
jurisprudence on the matter;
b. That this Hon. Court has no jurisdiction to hear and decide the case;
c. Award of damages in favor of plaintiff, more particularly award of moral
damages is contrary to law; and
d. Defendant has valid, legal and justiciable defenses.2
The appealed case was handled by Atty. Benjamin Bautista, an associate of the same law firm.
The decision appealed from was affirmed in toto by the Court of Appeals in CA-G.R. No.
52610R. A Motion for Reconsideration was filed by petitioner, through a different counsel, Atty.
Isabelo V.L. Santos II. However the same was denied and the decision became final on June 29,
1977 and was then remanded to the lower Court, presided by respondent Judge for execution. 3
A Motion for Execution was thereafter filed by private respondent with the lower Court which was
granted by respondent Judge. 4
On July 6, 1977, petitioner, through Atty. Isabelo V.L. Santos 11, filed a Petition for Relief from
Judgment alleging his discovery that Irineo W. Vida Jr., who prepared his Answer to the
Complaint is not a member of the Philippine Bar and that consequently, his rights had not been
adequately protected and his properties are in danger of being confiscated and/or levied upon
without due process of law. 5
In an Order dated July 12, 1977, respondent Judge denied the Petition and directed the
issuance of a writ of execution for the reasons that said Petition is ". . a clear case of dilatory
tactic on the part of counsel for defendant-appellant ..." herein petitioner, and, that the grounds
relied upon ". . . could have been ventilated in the appeal before the Court of Appeals ... " 6
On July 19, 1977, respondent Deputy Sheriff Ricardo G. Carlos, acting upon the writ of
execution, issued by respondent Judge, levied on three motor vehicles, of petitioner for the
satisfaction of the judgment. 7
Hence the instant Petition.
Respondent Judge's forthright denial of the Petition for Relief to frustrate a dilatory maneuver is
well-taken; and this Petition must be denied for lack of merit. The alleged fact that the person
who represented petitioner at the initial stage of the litigation, i.e., the filing of an Answer and the
pretrial proceedings, turned out to be not a member of the Bar 8 did not amount to a denial of
petitioner's day in court. It should be noted that in the subsequent stages of the proceedings,
after the rendition of the judgment by default, petitioner was duly represented by bona
fide members of the Bar in seeking a reversal of the judgment for being contrary to law and
jurisprudence and the existence of valid, legal and justifiable defenses. In other words,
petitioner's rights had been amply protected in the proceedings before the trial and appellate
courts as he was subsequently assisted by counsel. Moreover, petitioner himself was at fault as
the order of treatment as in default was predicated, not only on the alleged counsel's failure to
attend the pretrial conference on April 6, 1972, but likewise on his own failure to attend the
same, without justifiable reason. To allow this petition due course is to countenance further delay
in a proceeding which has already taken well over six years to resolve,
WHEREFORE, for lack of merit, the Petition for certiorari with Preliminary Injunction is hereby
dismissed. The law firm "Vida, Enriquez, Mercado & Associates" of 209 Sampaguita Bldg.,
Cubao, Quezon City, is hereby ordered to explain, within ten (10) days from notice this
Resolution, why Irineo W. Vida Jr. was permitted to sign the Answer in Civil Case No. 680-V of
CFI, Bulacan, when he is not a member of the Bar.
G.R. No. 111474 August 22, 1994
FIVE J TAXI and/or JUAN S. ARMAMENTO, petitioners,
vs.
NATIONAL LABOR RELATIONS COMMISSION, DOMINGO MALDIGAN and GILBERTO
SABSALON, respondents.
Edgardo G. Fernandez for petitioners.
R E SO L U T I O N
REGALADO, J.:
Petitioners Five J Taxi and/or Juan S. Armamento filed this special civil action for certiorari to
annul the decision 1 of respondent National Labor Relations Commission (NLRC) ordering
petitioners to pay private respondents Domingo Maldigan and Gilberto Sabsalon their
accumulated deposits and car wash payments, plus interest thereon at the legal rate from the
date of promulgation of judgment to the date of actual payment, and 10% of the total amount as
and for attorney's fees.
We have given due course to this petition for, while to the cynical the de minimis amounts
involved should not impose upon the valuable time of this Court, we find therein a need to clarify
some issues the resolution of which are important to small wage earners such as taxicab drivers.
As we have heretofore repeatedly demonstrated, this Court does not exist only for the rich or the
powerful, with their reputed monumental cases of national impact. It is also the Court of the poor
or the underprivileged, with the actual quotidian problems that beset their individual lives.
Private respondents Domingo Maldigan and Gilberto Sabsalon were hired by the petitioners as
taxi drivers 2 and, as such, they worked for 4 days weekly on a 24-hour shifting schedule. Aside
from the daily "boundary" of P700.00 for air-conditioned taxi or P450.00 for non-air-conditioned
taxi, they were also required to pay P20.00 for car washing, and to further make a P15.00
deposit to answer for any deficiency in their "boundary," for every actual working day.
In less than 4 months after Maldigan was hired as an extra driver by the petitioners, he already
failed to report for work for unknown reasons. Later, petitioners learned that he was working for
"Mine of Gold" Taxi Company. With respect to Sabsalon, while driving a taxicab of petitioners on
September 6, 1983, he was held up by his armed passenger who took all his money and
thereafter stabbed him. He was hospitalized and after his discharge, he went to his home
province to recuperate.
In January, 1987, Sabsalon was re-admitted by petitioners as a taxi driver under the same terms
and conditions as when he was first employed, but his working schedule was made on an
"alternative basis," that is, he drove only every other day. However, on several occasions, he
failed to report for work during his schedule.
On September 22, 1991, Sabsalon failed to remit his "boundary" of P700.00 for the previous
day. Also, he abandoned his taxicab in Makati without fuel refill worth P300.00. Despite repeated
requests of petitioners for him to report for work, he adamantly refused. Afterwards it was
revealed that he was driving a taxi for "Bulaklak Company."
Sometime in 1989, Maldigan requested petitioners for the reimbursement of his daily cash
deposits for 2 years, but herein petitioners told him that not a single centavo was left of his
deposits as these were not even enough to cover the amount spent for the repairs of the taxi he
was driving. This was allegedly the practice adopted by petitioners to recoup the expenses
incurred in the repair of their taxicab units. When Maldigan insisted on the refund of his deposit,
petitioners terminated his services. Sabsalon, on his part, claimed that his termination from
employment was effected when he refused to pay for the washing of his taxi seat covers.
On November 27, 1991, private respondents filed a complaint with the Manila Arbitration Office
of the National Labor Relations Commission charging petitioners with illegal dismissal and illegal
deductions. That complaint was dismissed, the labor arbiter holding that it took private
respondents two years to file the same and such unreasonable delay was not consistent with the
natural reaction of a person who claimed to be unjustly treated, hence the filing of the case could
be interpreted as a mere afterthought.
Respondent NLRC concurred in said findings, with the observation that private respondents
failed to controvert the evidence showing that Maldigan was employed by "Mine of Gold" Taxi
Company from February 10, 1987 to December 10, 1990; that Sabsalon abandoned his taxicab 1991 165.00 2,300.00
on September 1, 1990; and that they voluntarily left their jobs for similar employment with other
taxi operators. It, accordingly, affirmed the ruling of the labor arbiter that private respondents'
———— ———— ————
services were not illegally terminated. It, however, modified the decision of the labor arbiter by
ordering petitioners to pay private respondents the awards stated at the beginning of this
resolution. P 3,579.00 P 4,327.00 P 2,700.00

Petitioners' motion for reconsideration having been denied by the NLRC, this petition is now
before us imputing grave abuse of discretion on the part of said public respondent.
This Court has repeatedly declared that the factual findings of quasi-judicial agencies like the
NLRC, which have acquired expertise because their jurisdiction is confined to specific matters,
are generally accorded not only respect but, at times, finality if such findings are supported by
substantial evidence. 3 Where, however, such conclusions are not supported by the evidence,
they must be struck down for being whimsical and capricious and, therefore, arrived at with
grave abuse of discretion. 4
Respondent NLRC held that the P15.00 daily deposits made by respondents to defray any
shortage in their "boundary" is covered by the general prohibition in Article 114 of the Labor
Code against requiring employees to make deposits, and that there is no showing that the
Secretary of Labor has recognized the same as a "practice" in the taxi industry. Consequently,
the deposits made were illegal and the respondents must be refunded therefor.
The foregoing accounting shows that from 1987-1991, Sabsalon was able to withdraw his
deposits through vales or he incurred shortages, such that he is even indebted to petitioners in
the amount of P3,448.00. With respect to Maldigan's deposits, nothing was mentioned
questioning the same even in the present petition. We accordingly agree with the
recommendation of the Solicitor General that since the evidence shows that he had not
withdrawn the same, he should be reimbursed the amount of his accumulated cash deposits. 5
On the matter of the car wash payments, the labor arbiter had this to say in his decision: "Anent
the issue of illegal deductions, there is no dispute that as a matter of practice in the taxi industry,
after a tour of duty, it is incumbent upon the driver to restore the unit he has driven to the same
clean condition when he took it out, and as claimed by the respondents (petitioners in the
present case), complainant(s) (private respondents herein) were made to shoulder the expenses
for washing, the amount doled out was paid directly to the person who washed the unit, thus we
find nothing illegal in this practice, much more (sic) to consider the amount paid by the driver as
illegal deduction in the context of the law." 6 (Words in parentheses added.)

Consequently, private respondents are not entitled to the refund of the P20.00 car wash
Article 114 of the Labor Code provides as follows:
payments they made. It will be noted that there was nothing to prevent private respondents from
cleaning the taxi units themselves, if they wanted to save their P20.00. Also, as the Solicitor
Art. 114. Deposits for loss or damage. — No employer shall require his General correctly noted, car washing after a tour of duty is a practice in the taxi industry, and is,
worker to make deposits from which deductions shall be made for the in fact, dictated by fair play.
reimbursement of loss of or damage to tools, materials, or equipment
supplied by the employer, except when the employer is engaged in such
On the last issue of attorney's fees or service fees for private respondents' authorized
trades, occupations or business where the practice of making deposits is a
representative, Article 222 of the Labor Code, as amended by Section 3 of Presidential Decree
recognized one, or is necessary or desirable as determined by the
No. 1691, states that non-lawyers may appear before the NLRC or any labor arbiter only (1) if
Secretary of Labor in appropriate rules and regulations.
they represent themselves, or (2) if they represent their organization or the members thereof.
While it may be true that Guillermo H. Pulia was the authorized representative of private
It can be deduced therefrom that the said article provides the rule on deposits for loss or respondents, he was a non-lawyer who did not fall in either of the foregoing categories. Hence,
damage to tools, materials or equipments supplied by the employer. Clearly, the same does not by clear mandate of the law, he is not entitled to attorney's fees.
apply to or permit deposits to defray any deficiency which the taxi driver may incur in the
remittance of his "boundary." Also, when private respondents stopped working for petitioners,
Furthermore, the statutory rule that an attorney shall be entitled to have and recover from his
the alleged purpose for which petitioners required such unauthorized deposits no longer existed.
client a reasonable compensation for his services 7 necessarily imports the existence of an
In other case, any balance due to private respondents after proper accounting must be returned
attorney-client relationship as a condition for the recovery of attorney's fees, and such
to them with legal interest.
relationship cannot exist unless the client's representative is a lawyer. 8

However, the unrebutted evidence with regard to the claim of Sabsalon is as follows:
WHEREFORE, the questioned judgment of respondent National Labor Relations Commission is
hereby MODIFIED by deleting the awards for reimbursement of car wash expenses and
YEAR DEPOSITS SHORTAGES VALES attorney's fees and directing said public respondent to order and effect the computation and
payment by petitioners of the refund for private respondent Domingo Maldigan's deposits, plus
legal interest thereon from the date of finality of this resolution up to the date of actual payment
1987 P 1,403.00 P 567.00 P 1,000.00
thereof.

1988 720.00 760.00 200.00

SO ORDERED.

1989 686.00 130.00 1,500.00

CANON 10

1990 605.00 570.00


G.R. No. 86421 May 31, 1994
SPS. THELMA R. MASINSIN and MIGUEL MASINSIN, SPS. GILBERTO and ADELINA,
ROLDAN, petitioners,
vs.
THE HON. ED VINCENT ALBANO, Presiding Judge of the Metropolitan Trial Court of
Manila, Branch X, DEPUTY SHERIFF JESS ARREOLA, VICENTE CAÑEDA and THE HON.
LEONARDO CRUZ, in his capacity as Presiding Judge Regional Trial of Manila, Branch
XXV, respondents.
Gregorio T. Fabros for petitioners.
Isidro F. Molina for private respondent.
RESOLUTION
VITUG, J.:
Spouses Miguel and Thelma Masinsin, et al., instituted this petition for certiorari, prohibition,
relief from judgment, as well as declaratory relief, with prayer for preliminary mandatory
injunction, asking us to order the Metropolitan Trial Court ("MTC") of Manila, Branch X, to cease
and desist from further proceeding with Civil Case No. 107203-CV.
This case emerged from an ejectment suit (docketed Civil Case No. 107203-CV) filed by private
respondent Vicente Cañeda ("Cañeda"), then as plaintiffs, against herein petitioners, as
defendants, with the Metropolitan Trial Court of Manila (Branch X). After trial, the MTC, on 01
July 1985, rendered judgment; thus:
PREMISES CONSIDERED, judgment is hereby rendered ordering the
defendants and all persons claiming right under them to vacate the
premises and to remove their house/apartment and surrender possession of
the subject land to the plaintiff; to pay to the plaintiff the sum of P100.00 a
month from January 1987 as the reasonable compensation for the use and
occupation of the premises until the land is actually vacated, and the costs
of suit. 1
No appeal having been taken therefrom, the judgment became final and executory. On 22
August 1985, petitioners filed a petition for certiorari before the Regional Trial Court of Manila
(Branch XXXII) seeking the annulment of the aforesaid decision in the ejectment case and to set
aside an order of its execution. The petition was in due time dismissed. Again, no appeal was
taken therefrom.
On 07 October 1985, a complaint for "Annulment of Judgment, Lease Contract and Damages"
was filed by petitioners before the Regional Trial Court of Manila (Branch XLI) asking, in main,
for the nullification of the judgment in the ejectment case. The complaint was dismissed on the
ground of res judicata. This time, petitioners appealed the dismissal to the Court of Appeals.
Meanwhile, a writ of execution was issued by the MTC for the enforcement of its decision. The
writ, however, was held in abeyance when petitioners deposited with the Court of Appeals the
sum of P3,000.00 in cash plus an amount of P100.00 to be paid every month beginning
February 1987. On 11 March 1987, the Court of Appeals affirmed the order of dismissal of the
lower court. Petitioners' recourse to this Court was to be of no avail. The petition was denied,
and an entry of judgment was made on 14 July 1987.
Accordingly, the records were remanded to the MTC for execution. When petitioners refused to
remove their house on the premises in question, upon motion of private respondent, an order of
demolition was issued. Shortly thereafter, the demolition began. Before the completion of the
demolition, a restraining order was issued by the Regional Trial Court of Manila (Branch XIX)
following a petition for certiorari, with preliminary injunction and restraining order, filed by
petitioners. On 23 February 1988, the trial court dismissed the petition.
Unfazed by the series of dismissals of their complaints and petitions, petitioners assailed anew
the MTC decision in a petition for certiorari, with preliminary injunction, and for declaratory relief
(docketed Civil Case No. 88-43944) before the Regional Trial Court of Manila (Branch XXV),
which, again, issued a restraining order. 2
Private respondent then filed a motion for an alias writ of execution with the MTC. An ex-
parte motion of petitioners for the issuance of a second restraining order was this time denied by
the RTC (Branch XXV). 3 On 23 August 1990, 4 the trial court, ultimately, dismissed the petition
with costs against petitioners.
In this petition, petitioners contend that the MTC of Manila (Branch X) has lost jurisdiction to
enforce its decision, dated 01 July 1985, in Civil Case No. 107203, when the property in
question was proclaimed an area for priority development by the National Housing Authority on
01 December 1987 by authority of Presidential Decree 2016.
The petition is totally without merit.
In resolving this issue, we only have to refer to our resolution of 01 February 1993 in G.R. No.
98446, entitled, "Spouses Thelma R. Masinsin, et al. vs. Court of Appeals, et al.," to which this
case is intimately related, where we ruled:
. . . The singular question common to both cases submitted for resolution of
this court is the implication of Presidential Decree No. 1517, otherwise
known as the "Urban Land Reform Law," and its amendments or
ramifications embodied in Proclamation No. 1893, as amended by
Proclamation No. 1967 and Presidential Decree No. 2016. All the above
statutes are being implemented by the Housing and Land Use Regulatory
Board, and the Housing and Urban Development Coordinating Council,
Office of the President.
There is a prejudicial issue the answer to which hangs the resolution of this
case. On May 20, 1992, this Court required the National Housing Authority
to submit a Comment on the status of the program of acquisition by the
Government of the land area which includes the disputed property, as part
of the Areas for Priority Development (APD), under the aforementioned
decrees and proclamations.
In compliance with said order of this Court, Mr. Andres C. Lingan, Manager
of the Metro Manila Project Department of the National Housing Authority,
submitted the following report on the status of Lot 6-A, Block 1012, located
at No. 1890 Obesis Street, Pandacan, Manila, known as the Carlos Estate,
an APD site. Pertinent portions of the report read:
 Please be informed that Lot 6-A, Block 1012 located at
No. 1890 Obesis St., Pandacan, Manila which is the
subject matter of the case and located within the Carlos
Estate declared as APD site pursuant to Presidential
Proclamation No. 1967, is not for acquisition by NHA.
The Carlos Estate is located outside of the NHA
projects under the Zonal Improvement Project (ZIP) and
Community Mortgage Program (CMP). The site,
however, is under the administration of the Presidential
Commission on Urban Poor (PCUP) for acquisition and
upgrading. (Emphasis Supplied.)
The above information answers the uncertainty concerning the status of the
alleged negotiation for the acquisition by the government of certain areas in
Metro Manila. The NHA is definitely NOT acquiring the said lot for its
program.
It appearing that the purpose of this Petition for Review is to set aside the
decision of the respondent Court of Appeals which affirmed the decision of
the lower courts, in order to avoid eviction from the disputed premises and
to be allowed to acquire the same allegedly under the Community Mortgage
Program of the National Housing Authority, we find the petition without merit
and deny the same. Consequently, the petition is DISMISSED. 5
What immediately catches one's attention to this case is the evident predilection of petitioners,
through different counsel, to file pleadings, one after another, from which not even this Court has
been spared. The utter lack of merit of the complaints and petitions simply evinces the deliberate
intent of petitioners to prolong and delay the inevitable execution of a decision that has long
become final and executory.
Four times did the petitioners, with the assistance of counsel, try to nullify the same MTC
decision before different branches of the court, trifling with judicial processes. Never, again,
should this practice be countenanced. 6
The lawyer's oath to which we have all subscribed in solemn agreement in dedicating ourselves
to the pursuit of justice, is not a mere fictile of words, drift and hollow, but a sacred trust that we
must uphold and keep inviolable. Perhaps, it is time we are here reminded of that pledge; thus -
LAWYER'S OATH
I, . . ., do solemnly swear that I will maintain allegiance to the Republic of
the Philippines; I will support and defend its Constitution and obey the laws
as well as the legal orders of the duly constituted authorities therein; I will do
no falsehood nor consent to its commission; I will not wittingly or willingly
promote or sue any groundless, false or unlawful suit nor give aid nor
consent to the same; I will not delay any man's cause for money or malice
and will conduct myself as a lawyer according to the best of my knowledge
and discretion with all good fidelity as well to the courts as to my clients and
I impose upon myself this obligation voluntary, without any mental
reservation or purpose of evasion.
SO HELP ME GOD. (Emphasis supplied.)
We have since emphasized in no uncertain terms that any act on the part of a lawyer, an officer
of the court, which visibly tends to obstruct, pervert, impede and degrade the administration of
justice is contumacious calling for both an exercise of disciplinary action and warranting
application of the contempt power. 7
WHEREFORE, the petition is DISMISSED. Petitioners' counsel of record is hereby strongly
CENSURED and WARNED that a similar infraction of the lawyer's oath in the future will be dealt
with most severely. Double costs against petitioners.
This resolution is immediately executory.
SO ORDERED.
[A.C. No. 5624. January 20, 2004]
NATASHA HUEYSUWAN-FLORIDO, complainant, vs. ATTY. JAMES BENEDICT C.
FLORIDO, respondent.
DECISION
YNARES-SANTIAGO, J.:
This is an administrative complaint for the disbarment of respondent Atty. James Benedict
C. Florido and his eventual removal from the Roll of Attorneys for allegedly violating his oath as
a lawyer by manufacturing, flaunting and using a spurious and bogus Court of Appeals
Resolution/Order.[1]
In her Complaint-Affidavit, Natasha V. Heysuwan-Florido averred that she is the legitimate
spouse of respondent Atty. James Benedict C. Florido, but that they are estranged and living
separately from each other. They have two children namely, Kamille Nicole H. Florido, five years
old, and James Benedict H. Florido, Jr., three years old both of whom are in complainants
custody. Complainant filed a case for the annulment of her marriage with respondent, docketed
as Civil Case No. 23122, before the Regional Trial Court of Cebu City, Branch 24. Meanwhile,
there is another case related to the complaint for annulment of marriage which is pending before
the Court of Appeals and docketed as CA-G.R. SP No. 54235 entitled, James Benedict C.
Florido v. Hon. Pampio Abarientos, et al.
Sometime in the middle of December 2001, respondent went to complainants residence in
Tanjay City, Negros Oriental and demanded that the custody of their two minor children be
surrendered to him. He showed complainant a photocopy of an alleged Resolution issued by the
Court of Appeals which supposedly granted his motion for temporary child
custody.[2] Complainant called up her lawyer but the latter informed her that he had not received
any motion for temporary child custody filed by respondent.
Complainant asked respondent for the original copy of the alleged resolution of the Court
of Appeals, but respondent failed to give it to her. Complainant then examined the resolution
closely and noted that it bore two dates: November 12, 2001 and November 29, 2001. Sensing
something amiss, she refused to give custody of their children to respondent.
In the mid-morning of January 15, 2002, while complainant was with her children in the
ABC Learning Center in Tanjay City, respondent, accompanied by armed men, suddenly arrived
and demanded that she surrender to him the custody of their children. He threatened to
forcefully take them away with the help of his companions, whom he claimed to be agents of the
National Bureau of Investigation.
 Alarmed, complainant immediately sought the assistance of the Tanjay City Police. The Rule 10.01 - A lawyer shall not do any falsehood; nor consent to the doing of any in
responding policemen subsequently escorted her to the police station where the matter could be court; nor shall he mislead, or allow the Court to be misled by any
clarified and settled peacefully. At the police station, respondent caused to be entered in the artifice.
Police Blotter a statement that he, assisted by agents of the NBI, formally served on complainant
the appellate courts resolution/order.[3] In order to diffuse the tension, complainant agreed to
Rule 10.02 - A lawyer shall not knowingly misquote or misrepresent the contents of
allow the children to sleep with respondent for one night on condition that he would not take
a paper, the language or the argument of an opposing counsel, or
them away from Tanjay City. This agreement was entered into in the presence of Tanjay City
the text of a decision or authority, or knowingly cite as a law a
Chief of Police Juanito Condes and NBI Investigator Roger Sususco, among others.
provision already rendered inoperative by repeal or amendment,
In the early morning of January 16, 2002, complainant received information that a van or assert as a fact that which has not been proved.
arrived at the hotel where respondent and the children were staying to take them to Bacolod
Moreover, the records show that respondent used offensive language in his pleadings in
City. Complainant rushed to the hotel and took the children to another room, where they stayed
describing complainant and her relatives. A lawyers language should be forceful but dignified,
until later in the morning.
emphatic but respectful as befitting an advocate and in keeping with the dignity of the legal
On the same day, respondent filed with the Regional Trial Court of Dumaguete City, profession.[9] The lawyers arguments whether written or oral should be gracious to both court
Branch 31, a verified petition[4] for the issuance of a writ of habeas corpus asserting his right to and opposing counsel and should be of such words as may be properly addressed by one
custody of the children on the basis of the alleged Court of Appeals resolution. In the meantime, gentlemen to another.[10] By calling complainant, a sly manipulator of truth as well as a vindictive
complainant verified the authenticity of the Resolution and obtained a certification dated January congenital prevaricator, hardly measures to the sobriety of speech demanded of a lawyer.
18, 2002[5] from the Court of Appeals stating that no such resolution ordering complainant to
Respondents actions erode the public perception of the legal profession. They constitute
surrender custody of their children to respondent had been issued.
gross misconduct and the sanctions for such malfeasance is prescribed by Section 27, Rule 138
At the hearing of the petition for habeas corpus on January 23, 2002, respondent did not of the Rules of Court which states:
appear. Consequently, the petition was dismissed.
SEC. 27. Disbarment and suspension of attorneys by Supreme Court, grounds therefore.- A
Hence, complainant filed the instant complaint alleging that respondent violated his
member of the bar may be disbarred or suspended from his office as attorney by the Supreme
attorneys oath by manufacturing, flaunting and using a spurious Court of Appeals Resolution in
Court for any deceit, malpractice or other gross misconduct in such office, grossly immoral
and outside a court of law. Furthermore, respondent abused and misused the privileged granted
conduct or by reason of his conviction of a crime involving moral turpitude, or for any violation of
to him by the Supreme Court to practice law in the country.
the oath which he is required to take before the admission to practice, or for a willful
After respondent answered the complaint, the matter was referred to the IBP-Commission disobedience appearing as attorney for a party without authority to do so.
on Bar Discipline for investigation, report and recommendation. The IBP-CBD recommended
Considering the attendant circumstances, we agree with the recommendation of the IBP
that respondent be suspended from the practice of law for a period of three years with a warning
Board of Governors that respondent should be suspended from the practice of law. However, we
that another offense of this nature will result in his disbarment.[6] On June 23, 2003, the IBP
find that the period of six years is too harsh a penalty. Instead, suspension for the lesser period
Board of Governors adopted and approved the Report and recommendation of the Commission
of two years, which we deem commensurate to the offense committed, is hereby imposed on
with the modification that the penalty of suspension be increased to six years.
respondent.
The issue to be resolved is whether or not the respondent can be held administratively
WHEREFORE, in view of all the foregoing, Atty. James Benedict C. Florido is
liable for his reliance on and attempt to enforce a spurious Resolution of the Court of Appeals.
SUSPENDED from the practice of law for a period of two (2) years.
In his answer to the complaint, respondent claims that he acted in good faith in invoking
Let copies of this resolution be entered in the personal record of respondent as a member
the Court of Appeals Resolution which he honestly believed to be authentic. This, however, is
of the Bar and furnished the Bar Confidant, the Integrated Bar of the Philippines (IBP) and the
belied by the fact that he used and presented the spurious resolution several times. As pointed
Court Administrator for circulation to all courts of the country.
out by the Investigating Commissioner, the assailed Resolution was presented by respondent on
at least two occasions: first, in his Petition for Issuance of Writ of Habeas Corpus docketed as SO ORDERED.
Special Proc. Case No. 3898,[7] which he filed with the Regional Trial Court of Dumaguete City;
and second, when he sought the assistance of the Philippine National Police (PNP) of Tanjay
City to recover custody of his minor children from complainant. Since it was respondent who A.M. No. MTJ-93-781 November 16, 1993
used the spurious Resolution, he is presumed to have participated in its fabrication.

Candor and fairness are demanded of every lawyer. The burden cast on the judiciary
would be intolerable if it could not take at face value what is asserted by counsel. The time that
will have to be devoted just to the task of verification of allegations submitted could easily be
imagined. Even with due recognition then that counsel is expected to display the utmost zeal in
the defense of a clients cause, it must never be at the expense of the truth. [8] Thus, the Code of
professional Responsibility states:
CANON 10. A LAWYER OWES CANDOR, FAIRNESS AND GOOD FAITH TO THE
COURT.
EDUARDO R. SANTOS, Petitioner, vs. JUDGE ORLANDO C. PAGUIO, MTC, Meycauayan,
Bulacan, Respondent.
Eduardo R. Santos for and in his own behalf.
DAVIDE, JR., J.:
The complainant herein is the lawyer for the defendants in Civil Case No. 90-1706, an action for
unlawful detainer commenced on 5 May 1990 with the Municipal Trial Court of Meycauayan,
Bulacan while the respondent is the presiding Judge of the said court. In his verified complaint
filed through the Office of the Court Administrator on 18 March 1993, the complainant charges
the respondent with gross ignorance of the law and gross incompetence. The complainant
supports his charge with the allegation that after the answer in the said case was filed and
"without notice and hearing," the latter rendered a decision on 28 June 1991, 1 the decretal
portion of which reads as follows:
WHEREFORE, in view of all the foregoing considerations, it is hereby respectfully prayed that
judgment be rendered in accordance with plaintiff's prayer in their Complaint in the above-
entitled case.chanroblesvirtualawlibrarychanrobles virtual law library
SO ORDERED.
He further alleges that Branch 18 of the Regional Trial Court (RTC) of Bulacan, in its Order of 19
January 1993 in Sp. Civil Action No. 03-M-93 2 - a petition for certiorari filed by the defendants in
Civil Case No. 90-1706 - had already opined that the said decision is void upon its face because
it:
. . . would be impossible to be implemented for the simple or obvious reason that the same
cannot be considered a decision at all. Instead of deciding or ordering something to be done, it
merely prays that judgment be rendered.
but despite this, the respondent still "changed and amended [his] final decision [of 28 June 1991]
in order to nullify the order of a superior Court, the RTC of Bulacan" via a new decision in Civil
Case No. 90-1706 3 promulgated on 25 January 1993. The dispositive portion of this new
decision reads as follows:
WHEREFORE, in view of all the foregoing, judgment is hereby rendered in favor of the plaintiff
by:
1. Ordering defendants and persons claiming any rights under them to vacate the premises
occupied by them, more particularly the portion on which are erected their respective dwelling
structure/unit, at 117 Bayugo, Meycauayan, Bulacan (or lot of plaintiff aforementioned) and to
remove said dwelling structure/units from said subject premises of plaintiff;chanrobles virtual law
library
2. Ordering defendants individually to pay the sum of P350.00 Philippine Currency, per month by
way of monthly rental commencing from May 16, 1990, and thereafter until they shall have
vacated the premises of the plaintiff;chanrobles virtual law library
3. Ordering the defendants to pay jointly and severally the sum of P2,000.00, Philippine
currency, on account of plaintiff's attorney's fees (retainer) and P500.00, Philippine Currency, for
every hearing/trial attended by said attorney before this Honorable Court; andchanrobles virtual
law library
4. Ordering the defendants to pay costs.
SO ORDERED.
According to the complainant, the dispositive portion of the 28 June 1991 Decision exhibits the
respondent's gross ignorance in "decision preparation," and that respondent's "haste to amend
the same to favor plaintiff was both appalling (sic) and downright improper." The complainant
then prays that the respondent "be removed from office if only to save the integrity of the
judiciary."chanrobles virtual law library
In his Comment filed on 2 July 1993, 4the respondent denies the imputations and alleges, inter
alia, that: (1) the complainant was not the original counsel for the defendants but one Atty.
Adriano Javier, Sr. who represented the latter until the time that the parties were directed to file
their respective position papers, specifically until 29 November 1991 when Atty. Javier filed a
motion to withdraw his appearance and the complainant filed his notice of appearance as
counsel for the defendants; (2) the Decision of 28 June 1991 was rendered only after a
preliminary conference was held where the parties with their respective counsels discussed the
possibility of an amicable settlement and after the defendants failed to comply with the 16
November 1990 Order for the parties to submit in writing their "respective position statements
setting forth the law and the facts relied upon by them and to submit the affidavits of their
witnesses and other evidences in support thereof within fifteen (15) days from receipt" thereof,
prompting the plaintiff to file on 5 April 1991 an ex-partemotion praying that judgment be
rendered in this case; (3) the defendants did not appeal from the 28 June 1991 Decision, hence
the plaintiff filed a motion for execution on 2 September 1991, which the defendants did not
oppose; instead they filed a motion for reconsideration and to declare the decision null and void
on the ground that the plaintiff did not file her pre-trail brief and there was no valid pre-trial order;
(4) on 4 December 1991, the plaintiff's motion for execution was granted and a writ of execution
was issued, a copy of which was sent to the Clerk of Court of the RTC of Malolos for service; (5)
on 5 January 1991, 5 he received an order from Branch 18 of the RTC of Bulacan directing him
to desist from implementing the writ of execution; (6) the presiding judge of said Branch 18,
Judge Demetrio B. Macapagal, Sr., issued on 19 January 1993 its order disposing of Sp. Civil
Action No. 03-M-93; (7) thereafter, he (respondent) handed down a new decision in Civil Case
No. 90-1706 on 25 January 1993 that contained "completely the missing sentences needed in
the dispositive portion" of its earlier decision; (8) instead of appealing therefrom, the defendants
filed on 4 February 1993 a motion to set aside the decision, which the court set for its
consideration and to which the plaintiff filed its opposition on 8 February 1993 together with a
motion for immediate execution; (9) on 22 March 1993, the complainant filed a motion to inhibit
the respondent by the former did not appear on the date it was set for consideration. He finally
contends that the issue regarding the dispositive portion of the 28 June 1991 Decision was
rendered moot and academic by the corrections made in the Decision of 25 January 1993; that
the charge of gross ignorance is contemptuous and unfounded; and the complainant's sweeping
conclusions show his disrespectful attitude.chanroblesvirtualawlibrarychanrobles virtual law
library
In his 17 June 1993 Rejoinder filed on 7 July 1993, 6 the complainant reiterates his charge that
the respondent is incompetent because he lacks the "ability to prepare a sensible and credible
decision," and maintains that the respondent's attempt to convince this Court that the dispositive
portion of the 28 June 1991 Decision is permissible and proper shows "gross ignorance."
Further, that the respondent believes that "he could correct the decision after its finality" and
after the RTC of Bulacan had declared it to be null and void upon its face clearly manifests his
"patent ignorance of our laws and jurisprudence."chanrobles virtual law library
In his Sur-Rejoinder filed on 13 July 1993,7 the respondent argues that while the 28 June 1991
Decision "could hardly be enforced for the reason that there is some sort of ambiguity or
omission (sic) in its dispositive portion," he was not prohibited from having the defect "timely
corrected and clarified," which was what he had in fact done, and that the "clarified decision" did
not prejudice "the substantial rights of the parties" since they "were given their day in court and
passed through the usual course of the proceedings." Accordingly, he could not be guilty of
gross ignorance of the law and of lack of competence.chanroblesvirtualawlibrarychanrobles
virtual law library
Wanting to have the last word, the complainant filed a Reply to Sur-rejoinder and Manifestation
on 28 July 1993. 8 Not to be outdone, the respondent filed a Manifestation to Reply on 9 August
1993.9chanrobles virtual law library
The Court referred this to the Office of the Court Administrator for evaluation, report and
recommendation.chanroblesvirtualawlibrarychanrobles virtual law library
On 31 August 1993, the Office of the Court Administrator submitted its Memorandum containing
its evaluation, report and recommendation. After summarizing the antecedent facts, the said
office submitted that the instant complaint is meritorious, and made the following findings:
It is quite unbelievable, nay, impossible for respondent to have overlooked the missing
dispositive portion of his original decision which is considered the executory portion thereof. The
only ineluctable conclusion is that respondent never read said decision before he signed the
same. If only he devoted even only a little time to read the same, such a missing portion
considered to be the most important part of a decision could not have escaped his attention. The
alleged dispositive portion was a prayer. It did not have the effect of finally disposing the case.
Presumably, this must have been simply copied from plaintiff's
complaint.chanroblesvirtualawlibrarychanrobles virtual law library
True, it was legally permissible for respondent to amend his original defective decision since the
RTC dismissed the petition for certiorari although Judge Perfecto Macapagal found that what
was rendered by Judge Paguio "can not be considered a decision at all." It took respondent
Judge 1-1/2 years to discover and correct his error; the error could have easily been discovered
at the time the Motion for Execution was filed on September 2, 1991. But the writ was
nonetheless issued on December 4, 1991. Hence, the belated correction would not mitigate his
liability. There is no denying that the quality of a decision rendered by the judge such as herein
respondent, is a reflection on the integrity of the court in dispensing justice to whom it is due.
Respondent was at the very least careless in failing to read carefully the decision that he signed.
In fact, both the original and amended decisions still contained errors in grammar and syntax
indicating that there was no adequate editing of the decision that was signed by him. If he had
been more careful, he would have avoided such fractured phrases as:chanrobles virtual law
library
1. Plaintiff on being opposed to this motion, countered as follows: (Page 5, Decision, June 28,
1991);chanrobles virtual law library
2. For a more vivid explanation showing the incidental facts (Ibid);chanrobles virtual law library
3. And defendants seems that they are not really sincere(Ibid);chanrobles virtual law library
4. But nothing has been done by the latter to renew such contract of lease of which right
becomes one of a detainer plain and simple (page 6, Ibid);chanrobles virtual law library
5. That being the case to allow them will mean ownership over the
property (Ibid).chanroblesvirtualawlibrarychanrobles virtual law library
It is possible that this is not the usual language of the Judge, for their fractured constructions
have no place in a court decision. Careful editing and rewriting should have been done.
and recommends that:
. . . a fine of P5,000.00 be imposed upon respondent with a warning that any repetition of the
same or similar infraction shall be meted with a more severe penalty of dismissal from the
service. He is also admonished to exhibit greater care in the writing of his decisions.
We find the above observations of the Office of the Court Administrator to be sufficiently
supported by the pleadings submitted by the parties in this
case.chanroblesvirtualawlibrarychanrobles virtual law library
After a careful examination of the respondent's "Decision" of 28 June 1991, we do find its body
to be flawed with grammatical and syntactic errors. Its "dispositive portion" disposes of, resolves
or decrees nothing. It cannot even be called a dispositive or decretal portion at all. It is obviously
a prayer lifted from a pleading of the plaintiff, such as the Memorandum or the ex-
partemanifestation and motion praying that judgment be rendered filed after the defendants
failed to file their position paper, although not from the complaint as suspected by the Court
Administrator. How it gained entry into what should have been the fallo is an arcanum. Any
attempt to unravel the mystery may only complicate the matter against the respondent who is
only charged herein with gross ignorance or incompetence.chanroblesvirtualawlibrarychanrobles
virtual law library
There can, however, be no dispute behind the errors of grammar and syntax and the fatally
infirmed "dispositive portion" is the inefficiency, neglect of duty or carelessness on the part of the
respondent betraying the absence of due care, diligence, conscientiousness and thoroughness -
qualities which Judges must, among others, possess. Respondent could have easily avoided the
errors and defects had he taken a little more time and effort to at least read its original copy
before he finally affixed his signature thereon. While this Court cannot expect every Judge to be
an expert on the English language or an authority in grammar, he must, however, do everything
he can, through constant study, extraordinary diligence, and passion for excellence, to produce
a decision which fosters respect for and encourages obedience to it and enhances the prestige
of the court.chanroblesvirtualawlibrarychanrobles virtual law library
As we see it then, the respondent failed to comply with two standard of conduct prescribed by
the Canons of Judicial Ethics, namely: that "[h]e should exhibit an industry and application
commensurate with the duties imposed upon him" 10 and that he should be conscientious,
studious and thorough. 11chanrobles virtual law library
Moreover, the respondent did not only issue a manifestly infirmed "decision," he even granted
the motion for its execution and issued the corresponding writ with full knowledge that there was
nothing to execute. He could not have feigned ignorance of such nothingness for it is
embarrassingly self-evident. He nevertheless ordered its execution, exhibiting once more his
inefficiency, carelessness, negligence, or even his
incompetence.chanroblesvirtualawlibrarychanrobles virtual law library
We must add, however, that it is not the respondent alone who must be blamed for such
unmitigated faux pas. The counsel for the parties in the case knew or ought to have known the
fatal defect of the dispositive portion and the obvious inefficacy of any writ of execution, yet, the
plaintiff's counsel still filed a motion for execution, while the counsel for the defendants - the
complainant herein - merely filed a motion for reconsideration based solely on the ground that
the plaintiff did not file her pre-trial brief and that there was no valid pre-trial order. Obviously, the
complainant initially believed in the completeness of the decision. As a matter of fact, when he
assailed the 25 January 1993 Decision, he alleged that what was amended was a
"final decision," a position totally inconsistent with his claim that the latter was void as declared
by the RTC of Bulacan. As officers of the court who owe to it candor, fairness and good
faith, 12both attorneys should have called the court's attention to the glaring defect of the
"dispositive portion" of the 28 June 1991 Decision.chanroblesvirtualawlibrarychanrobles virtual
law library
We thus conclude that the respondent Judge is guilty of, in the very least, inefficiency, neglect of
duty and the violation of Canons 5 and 31 of the Canons of Judicial Ethics. He could not,
however, be liable for ignorance of law and jurisprudence or for incompetence when he handed
down a new decision on 25 January 1993. The 28 June 1991 Decision was "incomplete" since,
for all legal intents and purposes, it had no fallo and could not attain finality, hence the
respondent had the power to amend it to make it conformable to law and
justice. 13 It is not therefore correct to say, as the complainant suggested, that the order of the
RTC of Bulacan in Sp. Civil Action No. 03-M-93 stating that the respondent's Decision of 28
June 1991 is "void upon its face" forever bars the respondent from rendering a new or amended
decision in the ejectment case.chanroblesvirtualawlibrarychanrobles virtual law library
We take this opportunity to stress once again that the administration of justice is a sacred task
and all those involved in it must faithfully adhere to, hold inviolate, and invigorate the principle
solemnly enshrined in the Constitution that a public office is a public trust and all public officers
and employees must at all times be accountable to the people, serve them with utmost
responsibility, integrity, loyalty and efficiency, and act with patriotism and justice and lead
modest lives. 14 Every Judge should never forget that he is the visible representation of the law
and, more importantly, of justice. 15Therefore, he must constantly be the embodiment of
competence, diligence, conscientiousness, thoroughness, efficiency, and integrity so as to
preserve, promote and enhance the people's confidence in the
Judiciary.chanroblesvirtualawlibrarychanrobles virtual law library
A few words must also be made of record regarding the complainant. We note that in his
complaint in this case he alleged under oath that after the defendants filed their answer, the
respondent "without any hearing, or at least this counsel was never notified of any such
hearing," rendered the 28 June 1991 Decision. This is of course inaccurate, if not outright false.
What the complainant conveniently left out in his complaint was that, as disclosed in the
Comment which he did not refute, after the defendants' answer with counterclaim was admitted
by the court, the case was set for preliminary conference and thereafter the parties were
required to submit their position papers and the affidavits of their witnesses and other evidence.
We find that the case was properly placed and considered under the Rule on Summary
Procedure and, accordingly, the court could decide the case on the basis of the submitted
position papers, affidavits and other pieces of evidence. Complainant further suppressed the fact
that he entered his appearance as counsel for the defendants only after the court had conducted
the preliminary conference and issued the order for the submission of the foregoing pleadings
and documents. He was not, therefore, entitled to any notice before
then.chanroblesvirtualawlibrarychanrobles virtual law library
The failure to divulge the foregoing facts may have been intended by the complainant to give his
complaint a strong prima facie case against the respondent. While he was entitled to adopt
certain strategies in his pleadings, he forgot that he owes to this Court absolute candor, fairness
and good faith. This Court can neither condone nor tolerate attempts to mislead it through
suppression of important facts which would have a bearing on its initial action. Complainant
should, therefore, be admonished to faithfully adhere to the Code of Professional
Responsibility.chanroblesvirtualawlibrarychanrobles virtual law library
WHEREFORE, for inefficiency and neglect of duty amounting to a violation of Canons 5 and 31
of the Canons of Judicial Ethics, respondent Judge ORLANDO C. PAGUIO is hereby sentenced
to pay a FINE of Five Thousand Pesos (P5,000.00). He is further warned that a repetition of the
same or similar infractions shall be dealt with more
severely.chanroblesvirtualawlibrarychanrobles virtual law library
Complainant is hereby ADMONISHED to be more careful in the drafting of pleadings, always
keeping in mind his duty under Canon 10 of the Code of Professional
Responsibility.chanroblesvirtualawlibrarychanrobles virtual law library
SO ORDERED.
A.C. No. 2837 October 7, 1994
ESTEBAN M. LIBIT, complainant,
vs.
ATTYS. EDELSON G. OLIVA and FLORANDO A. UMALI, respondent.
RESOLUTION
PER CURIAM:
In civil Case No. 84-24144 of the Court of First Instance of Manila, entitled "Pedro Cutingting,
plaintiff versus Alfredo Tan, defendant", the Honorable Presiding Judge Domingo Panis issued
the following order:
The Director of the National Bureau of Investigation (NBI) is hereby ordered
to conduct an investigation with the end in view of determining the author of
the Sheriff's Return which appears to have been falsified and to institute
such criminal action as the evidence will warrant. (p. 1, Final Report.)
After conducting the necessary investigation, the National Bureau of Investigation (NBI), through
herein complainant, charged respondents as follows:
That sometime in May 1984 in the City of Manila, at the Regional Trial
Court, Branch XLI, Manila, Philippines, the above-named Respondents, as
Counsels for PEDRO CUTINGTING in Civil Case No. 84-24144, entitled
PEDRO CUTINGTING, Plaintiff vs. ALFREDO TAN, Defendant, did then
and there, knowingly, willfully introduced/presented in evidence before the
aforesaid Regional Trial Court, a falsified Sheriff's Return of Summons
during the hearing of the aforesaid Civil Case thereby impending and/or
obstructing the speedy administration and/or dispensation of Justice. (p. 2,
Final Report, ff. p. 69, Record.)
Respondents in their respective answers denied having any hand in the falsification of the said
sheriff's return.
Pursuant to Rule 139-B of the Rules of Court and the resolution of the Court En Banc of April 12,
1988, the case was referred to the Commission on Bar Discipline of the Integrated Bar of the
Philippines (IBP) for investigation, report, and recommendation.
In view, however, of the report of the National Bureau of Investigation to the effect that the
signature above the typewritten name Florando Umali on the last page of the complaint in said
civil case is not his signature, complainant, through counsel, agreed to the dismissal of the case
with respect to Atty. Umali.
With respect to Atty. Edelson G. Oliva, the IBP submitted the following report and
recommendation:
 There is ample evidence extant in the records to prove that
Atty. Oliva has something to do with the falsification of the Sheriff's Return
on the Summons in said Civil Case No. 84-24144.
The oral and documentary evidence of the complainant strongly tend to
show the following: (1) The Sheriff's Return of the Summon in the said civil
case was falsified as it was not signed by Deputy Sheriff Rodolfo Torella
(Exh. "J" — Sworn Statement of Rodolfo Torella dated February 1, 1985,
and Exh. "S", which is the falsified Sheriff's Return); (2) The summons was
received from the clerk of the Court of the Manila
RTC-Branch LXI by Ronaldo Romero, a messenger in the law office of
Attys. Umali and Oliva and said messenger brought the summons to the law
office of the respondents (Exh. "H" — Sinumpaang Salaysay ni Ronaldo
Romero, and Exh. "G", Exh. "I" — Sworn Statement dated February 28,
1985 of Mariano Villanueva, Chief Staff Asst. 2, RTC, Manila; (3) On the
basis of the falsified Sheriff's Return on the Summons, Atty. Oliva, counsel
for the defendant [should be plaintiff] in said civil case, filed a typewritten
Motion to Declare Defendant in Default (Exh.) "R" — Motion to Declare
Defendant In Default in said civil case signed and filed by Atty. Oliva);
(4) On March 29, 1984, Atty. Oliva, in his capacity as Operations Manager
of Judge Pio R. Marcos Law Office, sent a final demand letter on Alfredo
Tan, the defendant in said Civil case, for payment of the sum of P70,174.00
(Exh. "T" — Demand Letter dated March 28, 1984 of Atty. Oliva addressed
to Alfredo Tan); (5) The demand letter of Atty. Oliva (Exh. "T"), the complaint
in said civil case (Exh. "Q", "Q-1", and "Q-2"), the falsified Sheriff's Return
on the Summons (Exh. "S"), the Motion To Declare Defendant In Default
dated October 30, 1984 signed and filed by
Atty. Oliva (Exh. "R" and "R-1") were typed on one and the same typewriter,
as shown in the Questioned Document Report No. 198-585 dated 19 June
1985 (Exh. "Q", "Q-1" and "Q-2"; Exh. "V", "V-1" and
"V-2").
After the careful review of the record of the case and the report and recommendation of the IBP,
the Court finds that respondent Atty. Edelson G. Oliva committed acts of misconduct which
warrant the exercise by the Court of its disciplinary powers. The facts, as supported by the
evidence, obtaining in this case indubitably reveal respondent's failure to live up to his duties as
a lawyer in consonance with the strictures of the lawyer's oath, the Code of Professional
Responsibility, and the Canons of Professional Ethics. A lawyer's responsibility to protect and
advance the interests of his client does not warrant a course of action propelled by ill motives
and malicious intentions against the other party.
At this juncture, it is well to stress once again that the practice of law is not a right but a privilege
bestowed by the State on those who show that they possess, and continue to possess, the
qualifications required by law for the conferment of such privilege. One of these requirements is
the observance of honesty and candor. It can not be gainsaid that candidness, especially
towards the courts, is essential for the expeditious administration of justice. Courts are entitled to
expect only complete candor and honesty from the lawyers appearing and pleading before them.
A lawyer, on the other hand, has the fundamental duty to satisfy the expectation. It is essential
that lawyers bear in mind at all times that their first duty is not to their clients but rather to the
courts, that they are above all court officers sworn to assist the courts in rendering justice to all
and sundry, and only secondarily are they advocates of the exclusive interests of their clients.
For this reason, he is required to swear to do no falsehood, nor consent to the doing of any in
court (Chavez vs. Viola, 196 SCRA 10 [1991].
In this case, respondent Atty. Edelson Oliva has manifestly violated that part of his oath as a
lawyer that he shall not do any falsehood. He has likewise violated Rule 10.01 of the Code of
Professional Responsibility which provides:
A lawyer shall not do any falsehood, nor consent to the doing of any in court
nor shall he mislead or allow the court to be misled by any artifice.
Accordingly, the Court resolved to impose upon Atty. Edelson Oliva the supreme penalty of
DISBARMENT. His license to practice law in the Philippines is CANCELLED and the Bar
Confidant is ordered to strike out his name from the Roll of Attorneys.
The case is ordered dismissed as against Atty. Florando Umali.
SO ORDERED.
Per Rec. Nos. 3527, 3408 August 23, 1935
JUSTA MONTEREY, complainant,
vs.
EUSTAQUIO V. ARAYATA and TERESO MA. MONTOYA, respondents.
Eustaquio V. Arayata in his own behalf.
Office of the Solicitor-General Hilado for the Government.
IMPERIAL, J.:
It is alleged in the charges filed against Attorney Eustaquio V. Arayata (1) that on August 27,
1931, while practicing his profession, he prepared and drew up in his favor a deed of sale of the
land described in transfer certificate of title No. 7591, for the sum of P4,000, stating therein that
the person who executed the document and sold the land to him was his father, Arcadio
Arayata, when he knew positively that this alleged vendor had already died on November 5,
1916; that knowing the document to be fictitious, he appeared before notary public Tereso Ma.
Montoya and made the latter legalize said document and state that Arcadio Arayata personally
appeared before him, although said fact was not true; and he later succeeded in having the
register of deeds cancel the transfer certificate of title issued to Arcadio Arayata and issue
transfer certificate of title No. 8370 in his favor; and (2) that on June 5, 1933, being legally
married to Aurora L. Saguil, he filed an application to marry Engracia F. Ortega, stating therein
under oath that he was single when in fact he was married, said marriage not having been
dissolved.
The charge filed against attorney and notary public Tereso Ma. Montoya consists in having
ratified the deed of sale and having stated that Arcadio Arayata personally appeared before him
and confirmed the sale, knowing fully well that said person is already dead and therefore could
do neither the one nor the other.
The investigation was finally conducted by the Judge of the Court of First Instance of the
Province of Cavite, who recommended that a disciplinary action be taken against Arayata and
that Montoya be exonerated, it having been clearly established that the latter, in ratifying the
document, acted in good faith and relied on Arayata's assurance that the old man then with him
was really the vendor Arcadio Arayata who ratified all the contents of the instrument. We concur
in the appreciation of the facts and we are of the opinion that said notary public and attorney
should really be exonerated and held innocent.
The established facts show that the respondent Arayata is the son of Arcadio Arayata who died
on November 5, 1916, leaving a widow and five children; that Arcadio Arayata in life, purchased
from the Bureau of Lands lot No. 3448 of the Hacienda de Santa Cruz de Malabon, for which
transfer certificate of title No. 7591 was issued to him; that on August 27, 1931, many years after
Arcadio Arayata's death, the respondent attorney prepared the deed, Exhibit A, stating therein
that his father sold the land in question to him for the sum of P4,000; that after affixing the
names of the alleged vendor and the two witnesses, the respondent brought an old man and the
two witnesses before notary public Tereso Ma. Montoya and requested the latter to ratify said
document, assuring him that the old man was the grantor and vendor and the other two were the
instrumental witnesses thereto; that the notary honestly believing said information, legalized and
registered the document after verifying from the old man that he ratified the contents thereof;
that the transfer was invalid and the document not genuine because another, not Arcadio
Arayata, signed it; that the respondent later applied for and obtained transfer certificate of title
No. 8370 of said land from the registry of deeds of Cavite after the former title was cancelled;
that sometime later, or on April 11, 1933, the respondent sold a portion of said land having an
area of two and one-half (2 ½) hectares to Sinforosa Torres, married to Basilio Sorosoro, for the
sum of P500.
With regard to the second charge, it likewise appears established that on June 5, 1933, the
respondent, being legally married to Aurora L. Saguil and said marriage not having been
dissolved, signed under oath an application to marry Engracia F. Ortega stating therein that he
was single, he being in fact married; the application was registered and duly considered and on
September 25, 1933, the register of the Province of Cavite issued the corresponding license
upon payment by the respondent of the sum of P2; for some unknown reasons the marriage
applied for was not solemnized; the respondent's wife, nevertheless, filed a complaint for bigamy
against the former, which is now pending in the justice of the peace court of Santa Rosa,
Laguna, for which reason the investigator is of the opinion, and so recommends, that no action
should be taken on the second charge. The recommendation is well founded and has our
approval.
In his first answer, respondent Arayata admitted that the sale had been made by his father who
was his true predecessor in interest, but alleged that nobody, including the complainant, could
complain of the transfer because none was prejudiced, he being the true and only heir. In his
second answer, however, and in the course of the investigation, he set up another defense
alleging that the person who had really sold him the land was his uncle Januario Arayata who, in
the deed and relative to the land, assumed the name of Arcadio Arayata. He further alleged that
it was his said uncle who signed the deed of transfer and ratified it before notary Montoya. We
find this second new defense improbable and unestablished.
The acts committed by the respondent Arayata relative to the deed of sale Exhibit A, and his
statements to notary Montoya with regard to said document, constitute malpractice and
unprofessional conduct under the provisions of section 21 of the Code of Civil Procedure,
meriting for him a disciplinary action mitigated in this case by the circumstance that he was
apparently the heir entitled to the ownership of the land and that the complainant has neither real
nor direct interest in the transaction complained of by her.
For the foregoing reasons, we hold Attorney Eustaquio V. Arayata guilty of malpractice and
suspend him from the practice of his profession for one (1) month, hereby reprimanding him for
having prepared and executed the deed of sale in question. So ordered.
G.R. No. L-25291 January 30, 1971
THE INSULAR LIFE ASSURANCE CO., LTD., EMPLOYEES ASSOCIATION-NATU, FGU
INSURANCE GROUP WORKERS and EMPLOYEES ASSOCIATION-NATU, and INSULAR
LIFE BUILDING EMPLOYEES ASSOCIATION-NATU, petitioners,
vs.
THE INSULAR LIFE ASSURANCE CO., LTD., FGU INSURANCE GROUP, JOSE M. OLBES
and COURT OF INDUSTRIAL RELATIONS, respondents.
Lacsina, Lontok and Perez and Luis F. Aquino for petitioners.
Francisco de los Reyes for respondent Court of Industrial Relations.
Araneta, Mendoza and Papa for other respondents.
CASTRO, J.:
Appeal, by certiorari to review a decision and a resolution en banc of the Court of Industrial
Relations dated August 17, 1965 and October 20, 1965, respectively, in Case 1698-ULP.
The Insular Life Assurance Co., Ltd., Employees Association-NATU, FGU Insurance Group
Workers & Employees Association-NATU, and Insular Life Building Employees Association-
NATU (hereinafter referred to as the Unions), while still members of the Federation of Free
Workers (FFW), entered into separate collective bargaining agreements with the Insular Life
Assurance Co., Ltd. and the FGU Insurance Group (hereinafter referred to as the Companies).
Two of the lawyers of the Unions then were Felipe Enaje and Ramon Garcia; the latter was
formerly the secretary-treasurer of the FFW and acting president of the Insular Life/FGU unions
and the Insular Life Building Employees Association. Garcia, as such acting president, in a
circular issued in his name and signed by him, tried to dissuade the members of the Unions from
disaffiliating with the FFW and joining the National Association of Trade Unions (NATU), to no
avail.
Enaje and Garcia soon left the FFW and secured employment with the Anti-Dummy Board of the
Department of Justice. Thereafter, the Companies hired Garcia in the latter part of 1956 as
assistant corporate secretary and legal assistant in their Legal Department, and he was soon
receiving P900 a month, or P600 more than he was receiving from the FFW. Enaje was hired on
or about February 19, 1957 as personnel manager of the Companies, and was likewise made
chairman of the negotiating panel for the Companies in the collective bargaining with the Unions.
In a letter dated September 16, 1957, the Unions jointly submitted proposals to the Companies
for a modified renewal of their respective collective bargaining contracts which were then due to
expire on September 30, 1957. The parties mutually agreed and to make whatever benefits
could be agreed upon retroactively effective October 1, 1957.
Thereafter, in the months of September and October 1957 negotiations were conducted on the
Union's proposals, but these were snagged by a deadlock on the issue of union shop, as a result
of which the Unions filed on January 27, 1958 a notice of strike for "deadlock on collective
bargaining." Several conciliation conferences were held under the auspices of the Department of
Labor wherein the conciliators urged the Companies to make reply to the Unions' proposals en
toto so that the said Unions might consider the feasibility of dropping their demand for union
security in exchange for other benefits. However, the Companies did not make any counter-
proposals but, instead, insisted that the Unions first drop their demand for union security,
promising money benefits if this was done. Thereupon, and prior to April 15, 1958, the petitioner
Insular Life Building Employees Association-NATU dropped this particular demand, and
requested the Companies to answer its demands, point by point, en toto. But the respondent
Insular Life Assurance Co. still refused to make any counter-proposals. In a letter addressed to
the two other Unions by the joint management of the Companies, the former were also asked to
drop their union security demand, otherwise the Companies "would no longer consider
themselves bound by the commitment to make money benefits retroactive to October 1, 1957."
By a letter dated April 17, 1958, the remaining two petitioner unions likewise dropped their
demand for union shop. April 25, 1958 then was set by the parties to meet and discuss the
remaining demands.
From April 25 to May 6, 1958, the parties negotiated on the labor demands but with no
satisfactory result due to a stalemate on the matter of salary increases. On May 13, 1958 the
Unions demanded from the Companies final counter-proposals on their economic demands,
particularly on salary increases. Instead of giving counter-proposals, the Companies on May 15,
1958 presented facts and figures and requested the Unions to submit a workable formula which
would justify their own proposals, taking into account the financial position of the former.
Forthwith the Unions voted to declare a strike in protest against what they considered the
Companies' unfair labor practices.
Meanwhile, eighty-seven (87) unionists were reclassified as supervisors without increase in
salary nor in responsibility while negotiations were going on in the Department of Labor after the
notice to strike was served on the Companies. These employees resigned from the Unions.
On May 20, 1958 the Unions went on strike and picketed the offices of the Insular Life Building
at Plaza Moraga.
On May 21, 1958 the Companies through their acting manager and president, the respondent
Jose M. Olbes (hereinafter referred to as the respondent Olbes), sent to each of the strikers a
letter (exhibit A) quoted verbatim as follows:
We recognize it is your privilege both to strike and to conduct picketing.
However, if any of you would like to come back to work voluntarily, you may:
1. Advise the nearest police officer or security guard of your intention to do
so.
2. Take your meals within the office.
3. Make a choice whether to go home at the end of the day or to sleep
nights at the office where comfortable cots have been prepared.
4. Enjoy free coffee and occasional movies.
5. Be paid overtime for work performed in excess of eight hours.
6. Be sure arrangements will be made for your families.
The decision to make is yours — whether you still believe in the motives of
the strike or in the fairness of the Management.
The Unions, however, continued on strike, with the exception of a few unionists who were
convinced to desist by the aforesaid letter of May 21, 1958.
From the date the strike was called on May 21, 1958, until it was called off on May 31, 1958,
some management men tried to break thru the Unions' picket lines. Thus, on May 21, 1958
Garcia, assistant corporate secretary, and Vicente Abella, chief of the personnel records section,
respectively of the Companies, tried to penetrate the picket lines in front of the Insular Life
Building. Garcia, upon approaching the picket line, tossed aside the placard of a picketer, one
Paulino Bugay; a fight ensued between them, in which both suffered injuries. The Companies
organized three bus-loads of employees, including a photographer, who with the said
respondent Olbes, succeeded in penetrating the picket lines in front of the Insular Life Building,
thus causing injuries to the picketers and also to the strike-breakers due to the resistance
offered by some picketers.
Alleging that some non-strikers were injured and with the use of photographs as evidence, the
Companies then filed criminal charges against the strikers with the City Fiscal's Office of Manila.
During the pendency of the said cases in the fiscal's office, the Companies likewise filed a
petition for injunction with damages with the Court of First Instance of Manila which, on the basis
of the pendency of the various criminal cases against striking members of the Unions, issued on
May 31, 1958 an order restraining the strikers, until further orders of the said court, from
stopping, impeding, obstructing, etc. the free and peaceful use of the Companies' gates,
entrance and driveway and the free movement of persons and vehicles to and from, out and in,
of the Companies' building.
On the same date, the Companies, again through the respondent Olbes, sent individually to the
strikers a letter (exhibit B), quoted hereunder in its entirety:
The first day of the strike was last 21 May 1958.
Our position remains unchanged and the strike has made us even more
convinced of our decision.
We do not know how long you intend to stay out, but we cannot hold your
positions open for long. We have continued to operate and will continue to
do so with or without you.
If you are still interested in continuing in the employ of the Group
Companies, and if there are no criminal charges pending against you, we
are giving you until 2 June 1958 to report for work at the home office. If by
this date you have not yet reported, we may be forced to obtain your
replacement.
Before, the decisions was yours to make.
So it is now.
Incidentally, all of the more than 120 criminal charges filed against the members of the Unions,
except three (3), were dismissed by the fiscal's office and by the courts. These three cases
involved "slight physical injuries" against one striker and "light coercion" against two others.
At any rate, because of the issuance of the writ of preliminary injunction against them as well as
the ultimatum of the Companies giving them until June 2, 1958 to return to their jobs or else be
replaced, the striking employees decided to call off their strike and to report back to work on
June 2, 1958.
However, before readmitting the strikers, the Companies required them not only to secure
clearances from the City Fiscal's Office of Manila but also to be screened by a management
committee among the members of which were Enage and Garcia. The screening committee
initially rejected 83 strikers with pending criminal charges. However, all non-strikers with pending
criminal charges which arose from the breakthrough incident were readmitted immediately by
the Companies without being required to secure clearances from the fiscal's office.
Subsequently, when practically all the strikers had secured clearances from the fiscal's office,
the Companies readmitted only some but adamantly refused readmission to 34 officials and
members of the Unions who were most active in the strike, on the ground that they committed
"acts inimical to the interest of the respondents," without however stating the specific acts
allegedly committed. Among those who were refused readmission are Emiliano Tabasondra,
vice president of the Insular Life Building Employees' Association-NATU; Florencio Ibarra,
president of the FGU Insurance Group Workers & Employees Association-NATU; and Isagani
Du Timbol, acting president of the Insular Life Assurance Co., Ltd. Employees Association-
NATU. Some 24 of the above number were ultimately notified months later that they were being
dismissed retroactively as of June 2, 1958 and given separation pay checks computed under
Rep. Act 1787, while others (ten in number) up to now have not been readmitted although there
have been no formal dismissal notices given to them.
On July 29, 1958 the CIR prosecutor filed a complaint for unfair labor practice against the
Companies under Republic Act 875. The complaint specifically charged the Companies with (1)
interfering with the members of the Unions in the exercise of their right to concerted action, by
sending out individual letters to them urging them to abandon their strike and return to work, with
a promise of comfortable cots, free coffee and movies, and paid overtime, and, subsequently, by
warning them that if they did not return to work on or before June 2, 1958, they might be
replaced; and (2) discriminating against the members of the Unions as regards readmission to
work after the strike on the basis of their union membership and degree of participation in the
strike.
On August 4, 1958 the Companies filed their answer denying all the material allegations of the
complaint, stating special defenses therein, and asking for the dismissal of the complaint.
After trial on the merits, the Court of Industrial Relations, through Presiding Judge Arsenio
Martinez, rendered on August 17, 1965 a decision dismissing the Unions' complaint for lack of
merit. On August 31, 1965 the Unions seasonably filed their motion for reconsideration of the
said decision, and their supporting memorandum on September 10, 1965. This was denied by
the Court of Industrial Relations en banc in a resolution promulgated on October 20, 1965.
Hence, this petition for review, the Unions contending that the lower court erred:
1. In not finding the Companies guilty of unfair labor practice in sending out
individually to the strikers the letters marked Exhibits A and B;
2. In not finding the Companies guilty of unfair labor practice for
discriminating against the striking members of the Unions in the matter of
readmission of employees after the strike;
3. In not finding the Companies guilty of unfair labor practice for dismissing
officials and members of the Unions without giving them the benefit of
investigation and the opportunity to present their side in regard to activities
undertaken by them in the legitimate exercise of their right to strike; and
4. In not ordering the reinstatement of officials and members of the Unions,
with full back wages, from June 2, 1958 to the date of their actual
reinstatement to their usual employment.
I. The respondents contend that the sending of the letters, exhibits A and B, constituted a
legitimate exercise of their freedom of speech. We do not agree. The said letters were directed
to the striking employees individually — by registered special delivery mail at that — without
being coursed through the Unions which were representing the employees in the collective
bargaining.
The act of an employer in notifying absent employees individually during a
strike following unproductive efforts at collective bargaining that the plant
would be operated the next day and that their jobs were open for them
should they want to come in has been held to be an unfair labor practice, as
an active interference with the right of collective bargaining through dealing
with the employees individually instead of through their collective bargaining
representatives. (31 Am. Jur. 563, citing NLRB v. Montgomery Ward & Co.
[CA 9th] 133 F2d 676, 146 ALR 1045)
Indeed, it is an unfair labor practice for an employer operating under a collective bargaining
agreement to negotiate or to attempt to negotiate with his employees individually in connection
with changes in the agreement. And the basis of the prohibition regarding individual bargaining
with the strikers is that although the union is on strike, the employer is still under obligation to
bargain with the union as the employees' bargaining representative (Melo Photo Supply
Corporation vs. National Labor Relations Board, 321 U.S. 332).
Indeed, some such similar actions are illegal as constituting unwarranted acts of interference.
Thus, the act of a company president in writing letters to the strikers, urging their return to work
on terms inconsistent with their union membership, was adjudged as constituting interference
with the exercise of his employees' right to collective bargaining (Lighter Publishing, CCA 7th,
133 F2d 621). It is likewise an act of interference for the employer to send a letter to all
employees notifying them to return to work at a time specified therein, otherwise new employees
would be engaged to perform their jobs. Individual solicitation of the employees or visiting their
homes, with the employer or his representative urging the employees to cease union activity or
cease striking, constitutes unfair labor practice. All the above-detailed activities are unfair labor
practices because they tend to undermine the concerted activity of the employees, an activity to
which they are entitled free from the employer's molestation.1
Moreover, since exhibit A is a letter containing promises of benefits to the employees in order to
entice them to return to work, it is not protected by the free speech provisions of the Constitution
(NLRB v. Clearfield Cheese Co., Inc., 213 F2d 70). The same is true with exhibit B since it
contained threats to obtain replacements for the striking employees in the event they did not
report for work on June 2, 1958. The free speech protection under the Constitution is
inapplicable where the expression of opinion by the employer or his agent contains a promise of
benefit, or threats, or reprisal (31 Am. Jur. 544; NLRB vs. Clearfield Cheese Co., Inc., 213 F2d
70; NLRB vs. Goigy Co., 211 F2d 533, 35 ALR 2d 422).
Indeed, when the respondents offered reinstatement and attempted to "bribe" the strikers with
"comfortable cots," "free coffee and occasional movies," "overtime" pay for "work performed in
excess of eight hours," and "arrangements" for their families, so they would abandon the strike
and return to work, they were guilty of strike-breaking and/or union-busting and, consequently, of
unfair labor practice. It is equivalent to an attempt to break a strike for an employer to offer
reinstatement to striking employees individually, when they are represented by a union, since
the employees thus offered reinstatement are unable to determine what the consequences of
returning to work would be.
Likewise violative of the right to organize, form and join labor organizations are the following
acts: the offer of a Christmas bonus to all "loyal" employees of a company shortly after the
making of a request by the union to bargain; wage increases given for the purpose of mollifying
employees after the employer has refused to bargain with the union, or for the purpose of
inducing striking employees to return to work; the employer's promises of benefits in return for
the strikers' abandonment of their strike in support of their union; and the employer's statement,
made about 6 weeks after the strike started, to a group of strikers in a restaurant to the effect
that if the strikers returned to work, they would receive new benefits in the form of
hospitalization, accident insurance, profit-sharing, and a new building to work in.2
Citing paragraph 5 of the complaint filed by the acting prosecutor of the lower court which states
that "the officers and members of the complainant unions decided to call off the strike and return
to work on June 2, 1958 by reason of the injunction issued by the Manila Court of First Instance,"
the respondents contend that this was the main cause why the strikers returned to work and not
the letters, exhibits A and B. This assertion is without merit. The circumstance that the strikers
later decided to return to work ostensibly on account of the injunctive writ issued by the Court of
First Instance of Manila cannot alter the intrinsic quality of the letters, which were calculated, or
which tended, to interfere with the employees' right to engage in lawful concerted activity in the
form of a strike. Interference constituting unfair labor practice will not cease to be such simply
because it was susceptible of being thwarted or resisted, or that it did not proximately cause the
result intended. For success of purpose is not, and should not, be the criterion in determining
whether or not a prohibited act constitutes unfair labor practice.
The test of whether an employer has interfered with and coerced employees
within the meaning of subsection (a) (1) is whether the employer has
engaged in conduct which it may reasonably be said tends to interfere with
the free exercise of employees' rights under section 3 of the Act, and it is
not necessary that there be direct evidence that any employee was in fact
intimidated or coerced by statements of threats of the employer if there is a
reasonable inference that anti-union conduct of the employer does have an
adverse effect on self-organization and collective bargaining. (Francisco,
Labor Laws 1956, Vol. II, p. 323, citing NLRB v. Ford, C.A., 1948, 170 F2d
735).
Besides, the letters, exhibits A and B, should not be considered by themselves alone but should
be read in the light of the preceding and subsequent circumstances surrounding them. The
letters should be interpreted according to the "totality of conduct doctrine,"
... whereby the culpability of an employer's remarks were to be evaluated
not only on the basis of their implicit implications, but were to be appraised
against the background of and in conjunction with collateral circumstances.
Under this "doctrine" expressions of opinion by an employer which, though
innocent in themselves, frequently were held to be culpable because of the
circumstances under which they were uttered, the history of the particular
employer's labor relations or anti-union bias or because of their connection
with an established collateral plan of coercion or interference. (Rothenberg
on Relations, p. 374, and cases cited therein.)
It must be recalled that previous to the petitioners' submission of proposals for an amended
renewal of their respective collective bargaining agreements to the respondents, the latter hired
Felipe Enage and Ramon Garcia, former legal counsels of the petitioners, as personnel
manager and assistant corporate secretary, respectively, with attractive compensations. After
the notice to strike was served on the Companies and negotiations were in progress in the
Department of Labor, the respondents reclassified 87 employees as supervisors without
increase in salary or in responsibility, in effect compelling these employees to resign from their
unions. And during the negotiations in the Department of Labor, despite the fact that the
petitioners granted the respondents' demand that the former drop their demand for union shop
and in spite of urgings by the conciliators of the Department of Labor, the respondents
adamantly refused to answer the Unions' demands en toto. Incidentally, Enage was the
chairman of the negotiating panel for the Companies in the collective bargaining between the
former and the Unions. After the petitioners went to strike, the strikers were individually sent
copies of exhibit A, enticing them to abandon their strike by inducing them to return to work upon
promise of special privileges. Two days later, the respondents, thru their president and manager,
respondent Jose M. Olbes, brought three truckloads of non-strikers and others, escorted by
armed men, who, despite the presence of eight entrances to the three buildings occupied by the
Companies, entered thru only one gate less than two meters wide and in the process, crashed
thru the picket line posted in front of the premises of the Insular Life Building. This resulted in
injuries on the part of the picketers and the strike-breakers.lâwphî1.ñèt Then the respondents
brought against the picketers criminal charges, only three of which were not dismissed, and
these three only for slight misdemeanors. As a result of these criminal actions, the respondents
were able to obtain an injunction from the court of first instance restraining the strikers from
stopping, impeding, obstructing, etc. the free and peaceful use of the Companies' gates,
entrance and driveway and the free movement of persons and vehicles to and from, out and in,
of the Companies' buildings. On the same day that the injunction was issued, the letter, Exhibit
B, was sent — again individually and by registered special delivery mail — to the strikers,
threatening them with dismissal if they did not report for work on or before June 2, 1958. But
when most of the petitioners reported for work, the respondents thru a screening committee —
of which Ramon Garcia was a member — refused to admit 63 members of the Unions on the
ground of "pending criminal charges." However, when almost all were cleared of criminal
charges by the fiscal's office, the respondents adamantly refused admission to 34 officials and
union members. It is not, however, disputed that all-non-strikers with pending criminal charges
which arose from the breakthrough incident of May 23, 1958 were readmitted immediately by the
respondents. Among the non-strikers with pending criminal charges who were readmitted were
Generoso Abella, Enrique Guidote, Emilio Carreon, Antonio Castillo, Federico Barretto, Manuel
Chuidian and Nestor Cipriano. And despite the fact that the fiscal's office found no probable
cause against the petitioning strikers, the Companies adamantly refused admission to them on
the pretext that they committed "acts inimical to the interest of the respondents," without stating
specifically the inimical acts allegedly committed. They were soon to admit, however, that these
alleged inimical acts were the same criminal charges which were dismissed by the fiscal and by
the courts..
Verily, the above actuations of the respondents before and after the issuance of the letters,
exhibit A and B, yield the clear inference that the said letters formed of the respondents scheme
to preclude if not destroy unionism within them.
To justify the respondents' threat to dismiss the strikers and secure replacements for them in
order to protect and continue their business, the CIR held the petitioners' strike to be an
economic strike on the basis of exhibit 4 (Notice of Strike) which states that there was a
"deadlock in collective bargaining" and on the strength of the supposed testimonies of some
union men who did not actually know the very reason for the strike. It should be noted that
exhibit 4, which was filed on January 27, 1958, states, inter alia:
TO: BUREAU OF LABOR RELATIONS
DEPARTMENT OF LABOR
MANILA
Thirty (30) days from receipt of this notice by the Office, this [sic] unions
intends to go on strike against
THE INSULAR LIFE ASSURANCE CO., LTD.
Plaza Moraga, Manila
 THE FGU INSURANCE GROUP
Plaza Moraga, Manila
INSULAR LIFE BUILDING ADMINISTRATION
Plaza Moraga, Manila .
for the following reason: DEADLOCK IN COLLECTIVE BARGAINING...
However, the employees did not stage the strike after the thirty-day period, reckoned from
January 27, 1958. This simply proves that the reason for the strike was not the deadlock on
collective bargaining nor any lack of economic concessions. By letter dated April 15, 1958, the
respondents categorically stated what they thought was the cause of the "Notice of Strike,"
which so far as material, reads:
3. Because you did not see fit to agree with our position on the union shop,
you filed a notice of strike with the Bureau of Labor Relations on 27 January
1958, citing `deadlock in collective bargaining' which could have been for no
other issue than the union shop." (exhibit 8, letter dated April 15, 1958.)
The strike took place nearly four months from the date the said notice of strike was filed. And the
actual and main reason for the strike was, "When it became crystal clear the management
double crossed or will not negotiate in good faith, it is tantamount to refusal collectively and
considering the unfair labor practice in the meantime being committed by the management such
as the sudden resignation of some unionists and [who] became supervisors without increase in
salary or change in responsibility, such as the coercion of employees, decided to declare the
strike." (tsn., Oct. 14, 1958, p. 14.) The truth of this assertion is amply proved by the following
circumstances: (1) it took the respondents six (6) months to consider the petitioners' proposals,
their only excuse being that they could not go on with the negotiations if the petitioners did not
drop the demand for union shop (exh. 7, respondents' letter dated April 7, 1958); (2) when the
petitioners dropped the demand for union shop, the respondents did not have a counter-offer to
the petitioners' demands. Sec. 14 of Rep. Act 875 required the respondents to make a reply to
the petitioners' demands within ten days from receipt thereof, but instead they asked the
petitioners to give a "well reasoned, workable formula which takes into account the financial
position of the group companies." (tsn., Sept. 8, 1958, p. 62; tsn., Feb. 26, 1969, p. 49.)
II. Exhibit H imposed three conditions for readmission of the strikers, namely: (1) the employee
must be interested in continuing his work with the group companies; (2) there must be no
criminal charges against him; and (3) he must report for work on June 2, 1958, otherwise he
would be replaced. Since the evidence shows that all the employees reported back to work at
the respondents' head office on June 2, 1953, they must be considered as having complied with
the first and third conditions.
Our point of inquiry should therefore be directed at whether they also complied with the second
condition. It is not denied that when the strikers reported for work on June 2, 1958, 63 members
of the Unions were refused readmission because they had pending criminal charges. However,
despite the fact that they were able to secure their respective clearances 34 officials and union
members were still refused readmission on the alleged ground that they committed acts inimical
to the Companies. It is beyond dispute, however, that non-strikers who also had criminal
charges pending against them in the fiscal's office, arising from the same incidents whence the
criminal charges against the strikers evolved, were readily readmitted and were not required to
secure clearances. This is a clear act of discrimination practiced by the Companies in the
process of rehiring and is therefore a violation of sec. 4(a) (4) of the Industrial Peace Act.
The respondents did not merely discriminate against all the strikers in general. They separated
the active from the less active unionists on the basis of their militancy, or lack of it, on the picket
lines. Unionists belonging to the first category were refused readmission even after they were
able to secure clearances from the competent authorities with respect to the criminal charges
filed against them. It is significant to note in this connection that except for one union official who
deserted his union on the second day of the strike and who later participated in crashing through
the picket lines, not a single union officer was taken back to work. Discrimination undoubtedly
exists where the record shows that the union activity of the rehired strikers has been less
prominent than that of the strikers who were denied reinstatement.
So is there an unfair labor practice where the employer, although authorized
by the Court of Industrial Relations to dismiss the employees who
participated in an illegal strike, dismissed only the leaders of the strikers,
such dismissal being evidence of discrimination against those dismissed
and constituting a waiver of the employer's right to dismiss the striking
employees and a condonation of the fault committed by them." (Carlos and
Fernando, Labor and Social Legislation, p. 62, citing Phil. Air Lines, Inc. v.
Phil. Air Lines Emloyees Association, L-8197, Oct. 31, 1958.)
It is noteworthy that — perhaps in an anticipatory effort to exculpate themselves from charges of
discrimination in the readmission of strikers returning to work — the respondents delegated the
power to readmit to a committee. But the respondent Olbes had chosen Vicente Abella, chief of
the personnel records section, and Ramon Garcia, assistant corporate secretary, to screen the
unionists reporting back to work. It is not difficult to imagine that these two employees — having
been involved in unpleasant incidents with the picketers during the strike — were hostile to the
strikers. Needless to say, the mere act of placing in the hands of employees hostile to the
strikers the power of reinstatement, is a form of discrimination in rehiring.
Delayed reinstatement is a form of discrimination in rehiring, as is having
the machinery of reinstatement in the hands of employees hostile to the
strikers, and reinstating a union official who formerly worked in a unionized
plant, to a job in another mill, which was imperfectly organized. (Morabe,
The Law on Strikes, p. 473, citing Sunshine Mining Co., 7 NLRB 1252;
Cleveland Worsted Mills, 43 NLRB 545; emphasis supplied.)
Equally significant is the fact that while the management and the members of the screening
committee admitted the discrimination committed against the strikers, they tossed back and
around to each other the responsibility for the discrimination. Thus, Garcia admitted that in
exercising for the management the authority to screen the returning employees, the committee
admitted the non-strikers but refused readmission to the strikers (tsn., Feb. 6, 1962, pp. 15-19,
23-29). Vicente Abella, chairman of the management's screening committee, while admitting the
discrimination, placed the blame therefor squarely on the management (tsn., Sept. 20, 1960, pp.
7-8, 14-18). But the management, speaking through the respondent Olbes, head of the
Companies, disclaimed responsibility for the discrimination. He testified that "The decision
whether to accept or not an employee was left in the hands of that committee that had been
empowered to look into all cases of the strikers." (tsn., Sept. 6, 1962, p. 19.)
Of course, the respondents — through Ramon Garcia — tried to explain the basis for such
discrimination by testifying that strikers whose participation in any alleged misconduct during the
picketing was not serious in nature were readmissible, while those whose participation was
serious were not. (tsn., Aug. 4, 1961, pp. 48-49, 56). But even this distinction between acts of
slight misconduct and acts of serious misconduct which the respondents contend was the basis
for either reinstatement or discharge, is completely shattered upon a cursory examination of the
evidence on record. For with the exception of Pascual Esquillo whose dismissal sent to the other
strikers cited the alleged commission by them of simple "acts of misconduct."
III. Anent the third assignment of error, the record shows that not a single dismissed striker was
given the opportunity to defend himself against the supposed charges against him. As earlier
mentioned, when the striking employees reported back for work on June 2, 1958, the
respondents refused to readmit them unless they first secured the necessary clearances; but
when all, except three, were able to secure and subsequently present the required clearances,
the respondents still refused to take them back. Instead, several of them later received letters
from the respondents in the following stereotyped tenor:
This will confirm the termination of your employment with the Insular Life-
FGU Insurance Group as of 2 June 1958.
The termination of your employment was due to the fact that you committed
acts of misconduct while picketing during the last strike. Because this may
not constitute sufficient cause under the law to terminate your employment
without pay, we are giving you the amount of P1,930.32 corresponding to
one-half month pay for every year of your service in the Group Company.
Kindly acknowledge receipt of the check we are sending herewith.
. (Notification to Authorized Agent Banks) dated May 9, 1952, an allocation of $1,000 or only
The respondents, however, admitted that the alleged "acts of misconduct" attributed to the
dismissed strikers were the same acts with which the said strikers were charged before the
fiscal's office and the courts. But all these charges except three were dropped or dismissed.
Indeed, the individual cases of dismissed officers and members of the striking unions do not
indicate sufficient basis for dismissal.
Emiliano Tabasondra, vice-president of the petitioner FGU Insurance Group Workers &
Employees Association-NATU, was refused reinstatement allegedly because he did not report
for duty on June 2, 1958 and, hence, had abandoned his office. But the overwhelming evidence
adduced at the trial and which the respondents failed to rebut, negates the respondents' charge
that he had abandoned his job. In his testimony, corroborated by many others, Tabasondra
particularly identified the management men to whom he and his group presented themselves on
June 2, 1958. He mentioned the respondent Olbes' secretary, De Asis, as the one who received
them and later directed them — when Olbes refused them an audience — to Felipe Enage, the
Companies' personnel manager. He likewise categorically stated that he and his group went to
see Enage as directed by Olbes' secretary. If Tabasondra were not telling the truth, it would
have been an easy matter for the respondents to produce De Asis and Enage — who testified
anyway as witnesses for the respondents on several occasions — to rebut his testimony. The
respondents did nothing of the kind. Moreover, Tabasondra called on June 21, 1958 the
respondents' attention to his non-admission and asked them to inform him of the reasons
therefor, but instead of doing so, the respondents dismissed him by their letter dated July 10,
1958. Elementary fairness required that before being dismissed for cause, Tabasondra be given
"his day in court."
At any rate, it has been held that mere failure to report for work after notice to return, does not
constitute abandonment nor bar reinstatement. In one case, the U.S. Supreme Court held that
the taking back of six of eleven men constituted discrimination although the five strikers who
were not reinstated, all of whom were prominent in the union and in the strike, reported for work
at various times during the next three days, but were told that there were no openings. Said the
Court:
... The Board found, and we cannot say that its finding is unsupported, that,
in taking back six union men, the respondent's officials discriminated against
the latter on account of their union activities and that the excuse given that
they did not apply until after the quota was full was an afterthought and not
the true reason for the discrimination against them. (NLRB v. Mackay Radio
& Telegraph Co., 304 U.S. 333, 58 Sup. Ct. 904, 82 L. Ed. 1381) (Mathews,
Labor Relations and the Law, p. 725, 728)
The respondents' allegation that Tabasondra should have returned after being refused
readmission on June 2, 1958, is not persuasive. When the employer puts off reinstatement when
an employee reports for work at the time agreed, we consider the employee relieved from the
duty of returning further.
Sixto Tongos was dismissed allegedly because he revealed that despite the fact that the
Companies spent more than P80,000 for the vacation trips of officials, they refused to grant
union demands; hence, he betrayed his trust as an auditor of the Companies. We do not find this
allegation convincing. First, this accusation was emphatically denied by Tongos on the witness
stand. Gonzales, president of one of the respondent Companies and one of the officials referred
to, took a trip abroad in 1958. Exchange controls were then in force, and an outgoing traveller on
a combined business and vacation trip was allowed by the Central Bank, per its Circular 52
P2,000, at the official rate of two pesos to the dollar, as pocket money; hence, this was the only
amount that would appear on the books of the Companies. It was only on January 21, 1962, per
its Circular 133 (Notification to Authorized Agent Banks), that the Central Bank lifted the
exchange controls. Tongos could not therefore have revealed an amount bigger than the above
sum. And his competence in figures could not be doubted considering that he had passed the
board examinations for certified public accountants. But assuming arguendo that Tongos indeed
revealed the true expenses of Gonzales' trip — which the respondents never denied or tried to
disprove — his statements clearly fall within the sphere of a unionist's right to discuss and
advertise the facts involved in a labor dispute, in accordance with section 9(a)(5) of Republic Act
875 which guarantees the untramelled exercise by striking employees of the right to give
"publicity to the existence of, or the fact involved in any labor dispute, whether by advertising,
speaking, patrolling or by any method not involving fraud or violence." Indeed, it is not only the
right, it is as well the duty, of every unionist to advertise the facts of a dispute for the purpose of
informing all those affected thereby. In labor disputes, the combatants are expected to expose
the truth before the public to justify their respective demands. Being a union man and one of the
strikers, Tongos was expected to reveal the whole truth on whether or not the respondent
Companies were justified in refusing to accede to union demands. After all, not being one of the
supervisors, he was not a part of management. And his statement, if indeed made, is but an
expression of free speech protected by the Constitution.
Free speech on both sides and for every faction on any side of the labor
relation is to me a constitutional and useful right. Labor is free ... to turn its
publicity on any labor oppression, substandard wages, employer unfairness,
or objectionable working conditions. The employer, too, should be free to
answer and to turn publicity on the records of the leaders of the unions
which seek the confidence of his men ... (Concurring opinion of Justice
Jackson in Thomas v. Collins, 323 U.S. 516, 547, 65 Sup. Ct. 315, 89 L. Ed.
430.) (Mathews, Labor Relations and the Law, p. 591.)
The respondents also allege that in revealing certain confidential information, Tongos committed
not only a betrayal of trust but also a violation of the moral principles and ethics of accountancy.
But nowhere in the Code of Ethics for Certified Public Accountants under the Revised Rules and
Regulations of the Board of Accountancy formulated in 1954, is this stated. Moreover, the
relationship of the Companies with Tongos was that of an employer and not a client. And with
regard to the testimonies of Juan Raymundo and Antolin Carillo, both vice-presidents of the
Trust Insurance Agencies, Inc. about the alleged utterances made by Tongos, the lower court
should not have given them much weight. The firm of these witnesses was newly established at
that time and was still a "general agency" of the Companies. It is not therefore amiss to conclude
that they were more inclined to favor the respondents rather than Tongos.
Pacifico Ner, Paulino Bugay, Jose Garcia, Narciso Daño, Vicente Alsol and Hermenigildo
Ramirez, opined the lower court, were constructively dismissed by non-readmission allegedly
because they not only prevented Ramon Garcia, assistant corporate secretary, and Vicente
Abella, chief of the personnel records section of the Companies, from entering the Companies'
premises on May 21, 1958, but they also caused bruises and abrasions on Garcia's chest and
forehead — acts considered inimical to the interest of the respondents. The Unions, upon the
other hand, insist that there is complete lack of evidence that Ner took part in pushing Garcia;
that it was Garcia who elbowed his way through the picket lines and therefore Ner shouted
"Close up," which the picketers did; and that Garcia tossed Paulino Bugay's placard and a fight
ensued between them in which both suffered injuries. But despite these conflicting versions of
what actually happened on May 21, 1958, there are grounds to believe that the picketers are not
responsible for what happened.lâwphî1.ñèt The picketing on May 21, 1958, as reported in the
police blotter, was peaceful (see Police blotter report, exh. 3 in CA-G.R. No. 25991-R of the
Court of Appeals, where Ner was acquitted). Moreover, although the Companies during the
strike were holding offices at the Botica Boie building at Escolta, Manila; Tuason Building at San
Vicente Street, Manila; and Ayala, Inc. offices at Makati, Rizal, Garcia, the assistant corporate
secretary, and Abella, the chief of the personnel records section, reported for work at the Insular
Life Building. There is therefore a reasonable suggestion that they were sent to work at the latter
building to create such an incident and have a basis for filing criminal charges against the
petitioners in the fiscal's office and applying for injunction from the court of first instance.
Besides, under the circumstances the picketers were not legally bound to yield their grounds and
withdraw from the picket lines. Being where the law expects them to be in the legitimate exercise
of their rights, they had every reason to defend themselves and their rights from any assault or
unlawful transgression. Yet the police blotter, about adverted to, attests that they did not resort
to violence.
The heated altercations and occasional blows exchanged on the picket line do not affect or
diminish the right to strike. Persuasive on this point is the following commentary: .
We think it must be conceded that some disorder is unfortunately quite
usual in any extensive or long drawn out strike. A strike is essentially a
battle waged with economic weapons. Engaged in it are human beings
whose feelings are stirred to the depths. Rising passions call forth hot
words. Hot words lead to blows on the picket line. The transformation from
economic to physical combat by those engaged in the contest is difficult to
prevent even when cool heads direct the fight. Violence of this nature,
however much it is to be regretted, must have been in the contemplation of
the Congress when it provided in Sec. 13 of Act 29 USCA Sec. 163, that
nothing therein should be construed so as to interfere with or impede or
diminish in any way the right to strike. If this were not so, the rights afforded
to employees by the Act would indeed be illusory. We accordingly recently
held that it was not intended by the Act that minor disorders of this nature
would deprive a striker of the possibility of reinstatement. (Republic Steel
Corp. v. N. L. R. B., 107 F2d 472, cited in Mathews, Labor Relations and the
Law, p. 378)
Hence the incident that occurred between Ner, et al. and Ramon Garcia was but a necessary
incident of the strike and should not be considered as a bar to reinstatement. Thus it has been
held that:
Fist-fighting between union and non-union employees in the midst of a strike is no bar to
reinstatement. (Teller, Labor Disputes and Collective Bargaining, Vol. II, p. 855 citing Stackpole
Carbon, Co. 6 NLRB 171, enforced 105 F2d 167.)
Furthermore, assuming that the acts committed by the strikers were transgressions of law, they
amount only to mere ordinary misdemeanors and are not a bar to reinstatement.
In cases involving misdemeanors the board has generally held that unlawful acts are not bar to
reinstatement. (Teller, Labor Disputes and Collective Bargaining, Id., p. 854, citing Ford Motor
Company, 23 NLRB No. 28.)
Finally, it is not disputed that despite the pendency of criminal charges against non-striking
employees before the fiscal's office, they were readily admitted, but those strikers who had
pending charges in the same office were refused readmission. The reinstatement of the strikers
is thus in order.
[W]here the misconduct, whether in reinstating persons equally guilty with
those whose reinstatement is opposed, or in other ways, gives rise to the
inference that union activities rather than misconduct is the basis of his
[employer] objection, the Board has usually required reinstatement."
(Teller, supra, p. 853, citing the Third Annual Report of NLRB [1938], p.
211.)
Lastly, the lower Court justified the constructive dismissal of Florencio Ibarra allegedly because
he committed acts inimical to the interest of the respondents when, as president of the FGU
Workers and Employees Association-NATU, he advised the strikers that they could use force
and violence to have a successful picket and that picketing was precisely intended to prevent the
non-strikers and company clients and customers from entering the Companies' buildings. Even if
this were true, the record discloses that the picket line had been generally peaceful, and that
incidents happened only when management men made incursions into and tried to break the
picket line. At any rate, with or without the advice of Ibarra, picketing is inherently explosive. For,
as pointed out by one author, "The picket line is an explosive front, charged with the emotions
and fierce loyalties of the union-management dispute. It may be marked by colorful name-
calling, intimidating threats or sporadic fights between the pickets and those who pass the line."
(Mathews, Labor Relations and the Law, p. 752). The picket line being the natural result of the
respondents' unfair labor practice, Ibarra's misconduct is at most a misdemeanor which is not a
bar to reinstatement. Besides, the only evidence presented by the Companies regarding Ibarra's
participation in the strike was the testimony of one Rodolfo Encarnacion, a former member of the
board of directors of the petitioner FGU Insurance Group Workers and Employees Union-NATU,
who became a "turncoat" and who likewise testified as to the union activities of Atty. Lacsina,
Ricardo Villaruel and others (annex C, Decision, p. 27) — another matter which emphasizes the
respondents' unfair labor practice. For under the circumstances, there is good ground to believe
that Encarnacion was made to spy on the actvities of the union members. This act of the
respondents is considered unjustifiable interference in the union activities of the petitioners and
is unfair labor practice.
It has been held in a great number of decisions at espionage by an
employer of union activities, or surveillance thereof, are such instances of
interference, restraint or coercion of employees in connection with their right
to organize, form and join unions as to constitute unfair labor practice.
... "Nothing is more calculated to interfere with, restrain and coerce
employees in the exercise of their right to self-organization than such
activity even where no discharges result. The information obtained by
means of espionage is in valuable to the employer and can be used in a
 variety of cases to break a union." The unfair labor practice is committed
whether the espionage is carried on by a professional labor spy or detective,
by officials or supervisory employees of the employer, or by fellow
employees acting at the request or direction of the employer, or an ex-
employee..." (Teller, Labor Disputes and Collective Bargaining, Vol. II, pp.
765-766, and cases cited.) .
IV. The lower court should have ordered the reinstatement of the officials and members of the
Unions, with full back wages from June 2, 1958 to the date of their actual reinstatement to their
usual employment. Because all too clear from the factual and environmental milieu of this case,
coupled with settled decisional law, is that the Unions went on strike because of the unfair labor
practices committed by the respondents, and that when the strikers reported back for work —
upon the invitation of the respondents — they were discriminatorily dismissed. The members
and officials of the Unions therefore are entitled to reinstatement with back pay.
[W]here the strike was induced and provoked by improper conduct on the
part of an employer amounting to an 'unfair labor practice,' the strikers are
entitled to reinstatement with back pay. (Rothenberg on Labor Relations, p.
418.)
discrimination, that is, from the date of their discharge (Cromwell Commercial Employees and
Laborers Union vs. Court of Industrial Relations, supra).
The respondents notified the petitioner strikers to report back for work on June 2, 1958, which
the latter did. A great number of them, however, were refused readmission because they had
criminal charges against them pending before the fiscal's office, although non-strikers who were
also facing criminal indictments were readily readmitted. These strikers who were refused
readmission on June 2, 1958 can thus be categorized as discriminatorily dismissed employees
and are entitled to backpay from said date. This is true even with respect to the petitioners Jose
Pilapil, Paulino Bugay, Jr. and Jose Garcia, Jr. who were found guilty only of misdemeanors
which are not considered sufficient to bar reinstatement (Teller, Labor Disputes and Collective
Bargaining, p. 854), especially so because their unlawful acts arose during incidents which were
provoked by the respondents' men. However, since the employees who were denied
readmission have been out of the service of the Companies (for more than ten years) during
which they may have found other employment or other means of livelihood, it is only just and
equitable that whatever they may have earned during that period should be deducted from their
back wages to mitigate somewhat the liability of the company, pursuant to the equitable principle
that no one is allowed to enrich himself at the expense of another (Macleod & Co. of the
Philippines v. Progressive Federation of Labor, 97 Phil. 205 [1955]).

The lower court gave inordinate significance to the payment to and acceptance by the dismissed
[A]n employee who has been dismissed in violation of the provisions of the
employees of separation pay. This Court has ruled that while employers may be authorized
Act is entitled to reinstatement with back pay upon an adjudication that the
under Republic Act 1052 to terminate employment of employees by serving the required notice,
discharge was illegal." (Id., citing Waterman S. S. Corp. v. N. L. R. B., 119
or, in the absence thereof, by paying the required compensation, the said Act may not be
F2d 760; N. L. R. B. v. Richter's Bakery, 140 F2d 870; N. L. R. B. v.
invoked to justify a dismissal prohibited by law, e.g., dismissal for union activities.
Southern Wood Preserving Co., 135 F. 2d 606; C. G. Conn, Ltd. v. N. L. R.
B., 108 F2d 390; N. L. R. B. v. American Mfg. Co., 106 F2d 61; N. L. R. B. v.
Kentucky Fire Brick Co., 99 F2d 99.) ... While Republic Act No. 1052 authorizes a commercial establishment to
terminate the employment of its employee by serving notice on him one
month in advance, or, in the absence thereof, by paying him one month
And it is not a defense to reinstatement for the respondents to allege that the positions of these
compensation from the date of the termination of his employment, such Act
union members have already been filled by replacements.
does not give to the employer a blanket authority to terminate the
employment regardless of the cause or purpose behind such termination.
[W]here the employers' "unfair labor practice" caused or contributed to the Certainly, it cannot be made use of as a cloak to circumvent a final order of
strike or where the 'lock-out' by the employer constitutes an "unfair labor the court or a scheme to trample upon the right of an employee who has
practice," the employer cannot successfully urge as a defense that the been the victim of an unfair labor practice. (Yu Ki Lam, et al. v. Nena
striking or lock-out employees position has been filled by replacement. Micaller, et al., 99 Phil. 904 [1956].)
Under such circumstances, if no job sufficiently and satisfactorily
comparable to that previously held by the aggrieved employee can be
Finally, we do not share the respondents' view that the findings of fact of the Court of Industrial
found, the employer must discharge the replacement employee, if
Relations are supported by substantial and credible proof. This Court is not therefore precluded
necessary, to restore the striking or locked-out worker to his old or
from digging deeper into the factual milieu of the case (Union of Philippine Education Employees
comparable position ... If the employer's improper conduct was an initial
v. Philippine Education Company, 91 Phil. 93; Lu Do & Lu Ym Corporation v. Philippine-Land-
cause of the strike, all the strikers are entitled to reinstatement and the
Air-Sea Labor Union, 11 SCRA 134 [1964]).
dismissal of replacement employees wherever necessary; ... . (Id., p. 422
and cases cited.)
V. The petitioners (15 of them) ask this Court to cite for contempt the respondent Presiding
Judge Arsenio Martinez of the Court of Industrial Relations and the counsels for the private
A corollary issue to which we now address ourselves is, from what date should the backpay
respondents, on the ground that the former wrote the following in his decision subject of the
payable to the unionists be computed? It is now a settled doctrine that strikers who are entitled
instant petition for certiorari, while the latter quoted the same on pages 90-91 of the respondents'
to reinstatement are not entitled to back pay during the period of the strike, even though it is
brief: .
caused by an unfair labor practice. However, if they offer to return to work under the same
conditions just before the strike, the refusal to re-employ or the imposition of conditions
amounting to unfair labor practice is a violation of section 4(a) (4) of the Industrial Peace Act and ... Says the Supreme Court in the following decisions:
the employer is liable for backpay from the date of the offer (Cromwell Commercial Employees
and Laborers Union vs. Court of Industrial Relations, L-19778, Decision, Sept. 30, 1964, 12
In a proceeding for unfair labor practice, involving a
SCRA 124; Id., Resolution on motion for reconsideration, 13 SCRA 258; see also Mathews,
determination as to whether or not the acts of the
Labor Relations and the Law, p. 730 and the cited cases). We have likewise ruled that
employees concerned justified the adoption of the
discriminatorily dismissed employees must receive backpay from the date of the act of
employer of disciplinary measures against them, the
 mere fact that the employees may be able to put up a
valid defense in a criminal prosecution for the same
acts, does not erase or neutralize the employer's right
to impose discipline on said employees. For it is settled
that not even the acquittal of an employee of the
criminal charge against him is a bar to the employer's
right to impose discipline on its employees, should the
act upon which the criminal charged was based
constitute nevertheless an activity inimical to the
employer's interest... The act of the employees now
under consideration may be considered as a
misconduct which is a just cause for dismissal. (Lopez,
Sr., et al. vs. Chronicle Publication Employees Ass'n. et
al., G.R. No. L-20179-81, December 28, 1964.)
(emphasis supplied)
The two pertinent paragraphs in the above-cited decision * which contained the underscored
portions of the above citation read however as follows:
Differently as regard the dismissal of Orlando Aquino and Carmelito
Vicente, we are inclined to uphold the action taken by the employer as
proper disciplinary measure. A reading of the article which allegedly caused
their dismissal reveals that it really contains an insinuation albeit subtly of
the supposed exertion of political pressure by the Manila Chronicle
management upon the City Fiscal's Office, resulting in the non-filing of the
case against the employer. In rejecting the employer's theory that the
dismissal of Vicente and Aquino was justified, the lower court considered
the article as "a report of some acts and omissions of an Assistant Fiscal in
the exercise of his official functions" and, therefore, does away with the
presumption of malice. This being a proceeding for unfair labor practice, the
matter should not have been viewed or gauged in the light of the doctrine on
a publisher's culpability under the Penal Code. We are not here to
determine whether the employees' act could stand criminal prosecution, but
only to find out whether the aforesaid act justifies the adoption by the
employer of disciplinary measure against them. This is not sustaining the
ruling that the publication in question is qualified privileged, but even on the
assumption that this is so, the exempting character thereof under the Penal
Code does not necessarily erase or neutralize its effect on the employer's
interest which may warrant employment of disciplinary measure. For it must
be remembered that not even the acquittal of an employee, of the criminal
charges against him, is a bar to the employer's right to impose discipline on
its employees, should the act upon which the criminal charges was based
constitute nevertheless an activity inimical to the employer's interest.
In the herein case, it appears to us that for an employee to publish his
"suspicion," which actually amounts to a public accusation, that his
employer is exerting political pressure on a public official to thwart some
legitimate activities on the employees, which charge, in the least, would
sully the employer's reputation, can be nothing but an act inimical to the said
employer's interest. And the fact that the same was made in the union
newspaper does not alter its deleterious character nor shield or protect a
reprehensible act on the ground that it is a union activity, because such end
can be achieved without resort to improper conduct or behavior. The act of
the employees now under consideration may be considered as a
misconduct which is a just cause for dismissal.** (Emphasis ours)
It is plain to the naked eye that the 60 un-underscored words of the paragraph quoted by the
respondent Judge do not appear in the pertinent paragraph of this Court's decision in L-20179-
81. Moreover, the first underscored sentence in the quoted paragraph starts with "For it is settled
..." whereas it reads, "For it must be remembered ...," in this Court's decision. Finally, the second
and last underlined sentence in the quoted paragraph of the respondent Judge's decision,
appears not in the same paragraph of this Court's decision where the other sentence is, but in
the immediately succeeding paragraph.
This apparent error, however, does not seem to warrant an indictment for contempt against the
respondent Judge and the respondents' counsels. We are inclined to believe that the
misquotation is more a result of clerical ineptitude than a deliberate attempt on the part of the
respondent Judge to mislead. We fully realize how saddled with many pending cases are the
courts of the land, and it is not difficult to imagine that because of the pressure of their varied
and multifarious work, clerical errors may escape their notice. Upon the other hand, the
respondents' counsels have the prima facie right to rely on the quotation as it appears in the
respondent Judge's decision, to copy it verbatim, and to incorporate it in their brief. Anyway, the
import of the underscored sentences of the quotation in the respondent Judge's decision is
substantially the same as, and faithfully reflects, the particular ruling in this Court's decision, i.e.,
that "[N]ot even the acquittal of an employee, of the criminal charges against him, is a bar to the
employer's right to impose discipline on its employees, should the act upon which the criminal
charges were based constitute nevertheless an activity inimical to the employer's interest."
Be that as it may, we must articulate our firm view that in citing this Court's decisions and rulings,
it is the bounden duty of courts, judges and lawyers to reproduce or copy the same word-for-
word and punctuation mark-for-punctuation mark. Indeed, there is a salient and salutary reason
why they should do this. Only from this Tribunal's decisions and rulings do all other courts, as
well as lawyers and litigants, take their bearings. This is because the decisions referred to in
article 8 of the Civil Code which reads, "Judicial decisions applying or interpreting the laws or the
Constitution shall form a part of the legal system of the Philippines," are only those enunciated
by this Court of last resort. We said in no uncertain terms in Miranda, et al. vs. Imperial, et al. (77
Phil. 1066) that "[O]nly the decisions of this Honorable Court establish jurisprudence or doctrines
in this jurisdiction." Thus, ever present is the danger that if not faithfully and exactly quoted, the
decisions and rulings of this Court may lose their proper and correct meaning, to the detriment of
other courts, lawyers and the public who may thereby be misled. But if inferior courts and
members of the bar meticulously discharge their duty to check and recheck their citations of
authorities culled not only from this Court's decisions but from other sources and make certain
that they are verbatim reproductions down to the last word and punctuation mark, appellate
courts will be precluded from acting on misinformation, as well as be saved precious time in
finding out whether the citations are correct.
Happily for the respondent Judge and the respondents' counsels, there was no substantial
change in the thrust of this Court's particular ruling which they cited. It is our view, nonetheless,
that for their mistake, they should be, as they are hereby, admonished to be more careful when
citing jurisprudence in the future. ACCORDINGLY, the decision of the Court of Industrial
Relations dated August 17, 1965 is reversed and set aside, and another is entered, ordering the
respondents to reinstate the dismissed members of the petitioning Unions to their former or
comparatively similar positions, with backwages from June 2, 1958 up to the dates of their actual
reinstatements. Costs against the respondents.
ATTY. LEON L. ASA and ATTY. JOSE A. OLIVEROS, A.C. No. 6501
Complainants, (CBD Case Nos. 03-1076, 03-1108, 03-1
1125)
-versus- Present:
QUISUMBING, Chairperson,
ATTY. PABLITO M. CASTILLO and ATTY. GINGER CARPIO,
ANNE CASTILLO, CARPIO MORALES, Court (RTC) of Angeles City, Branch 59. Castillo appeared as counsel of record for the therein
Respondents. TINGA, and petitioner, Dr. Salvador H. Laurel, guardian ad litem of the minors Nonan who appear to have
VELASCO, JR., JJ. inherited a sizeable amount of US dollars.
x - - - - - - - - - - - - - - - - - - - - - - - -x
ATTY. PABLITO M. CASTILLO, A misunderstanding later occurred between Asa and Castillo as regards their sharing
Complainant, Promulgated: in the attorneys fees in the guardianship case.

On page 6 of a pleading entitled Reply to Petitioner-Guardians

-versus- August 31, 2006 Comment/Opposition,[1] ETC. dated July 19, 2002 filed before Branch 59 of the Angeles RTC
and signed by Castillos daughter Ginger Anne Castillo (Ginger Anne) as counsel for Castillo who
filed a Notice Ad Cautelam, it was alleged that, inter alia, Asa wants to be paid an additional
ATTY. JOSE A. OLIVEROS, $75,000.00 for his services in providing coffee and opening doors whenever there is a
Respondent. conference at the Laurel Law Offices.[2]

x-----------------------x Finding the above statement of Castillo and Ginger Anne to be a brazen falsehood
concocted to besmirch Asas reputation, Asa and Oliveros filed before IBP an administrative
[3]
ATTY. PABLITO M. CASTILLO, complaint against Castillo and Ginger Anne, for gross violation of the lawyers oath and the
Complainant, Code of Professional Responsibility. The case was docketed as CBD Case No. 03-1076.

In their complaint, Asa and Oliveros also charged Castillo with machinations and
-versus- deceit arising from the following alleged incidents:

In a conference held at the Laurel Law Offices prior to January 20, 2000 attended by
ATTY. LEON L. ASA, Dr. Laurel, the Nonan minors counsel abroad Atty. Benjamin Cassiday III (Cassiday), Asa and
Respondent. Castillo, it was agreed that the amount to be received by Dr. Laurel in trust for the Nonan heirs
would be deposited at the Rizal Commercial Banking Corporation (RCBC), St. Francis Square
x- - - - - - - - - - - - - - - - - - - - - - - - x Branch, PasigCity under Dollar Savings Account No. 8-250-00043-0. Castillo, however,
proposed that the funds be deposited instead at the United Coconut Planters Bank (UCPB), he
explaining that he knew an employee there who could facilitate the transaction. Dr. Laurel
rejected this proposition and instead instructed Castillo to file the appropriate motion to have the
ATTY. LEON L. ASA, funds deposited at the RCBC.[4]
Complainant,
Without showing to Dr. Laurel the motion he was instructed to prepare, Castillo filed
the same with the Angeles trial court. Dr. Laurel subsequently received a copy of a March 2,
-versus- 2000 RTC Order[5] signed by the then trial Judge Eliezer R. De los Santos granting his motion
and accordingly directing that the funds to be held in trust for the Nonan children be deposited at
the Trust Department of the UCPB Head Office. Dr. Laurel, Cassiday and Asa thus filed with the
ATTY. PABLITO M. CASTILLO, Angeles City trial court an Urgent Motion for Reconsideration[6] of the March 2, 2000 Angeles
Respondent. RTC Order in order to have the funds deposited at the RCBC transferred to the RTC, as
previously agreed upon.This motion was granted.

x--------------------------------------------------x
DECISION
CARPIO MORALES, J.:
Subject of the present Decision are four administrative cases, docketed by the
Integrated Bar of the Philippines (IBP) as Commission on Bar Discipline (CBD) Case Nos. 03-
1076,03-1108,03-1109, and 03-1125.
I. CBD Case No. 03-1076
In 1996, Atty. Pablito M. Castillo (Castillo), then an associate of the Laurel Law Offices
of which Attorneys Leon L. Asa (Asa) and Jose A. Oliveros (Oliveros) are partners, endorsed to
the law firm a guardianship case, Special Proceeding No. 5222, In re: Guardianship of the
Minors Honeylyn, Alexandra and Jerill Nonan, which was pending before the Regional Trial
Still in the same complaint, Asa and Oliveros alleged that in a Reply to Answer[7] dated
June 25, 2001 filed by Castillo with the RTC of Makati City, Branch 145 in Civil Case No. 01-
506, Atty. P.M. Castillo v. United Coconut Planters Bank, Lorenzo V. Tan and Angelica S.
Hernandez, Castillo again committed a clear falsehood when he therein stated that:
On the other hand, retired Justice Felipe Kalalo of the Court of
Appeals who personally knew the plaintiff [Castillo] was also profuse in
extolling his academic credentials and accomplishments as a Trial lawyer as
follows:
Q: Do you know the claimant Atty. P.M. Castillo?
A: Yes sir, because we were both active Senior Trial lawyers of
the Laurel Law Offices,[8](Underscoring supplied),
he knowing that retired Justice Kalalo had never been at any time a lawyer at the Laurel Law
Offices. In support of this allegation, they appended to the complaint a certified true copy of the
Service Record[9] of Justice Kalalo which does not show that he was ever connected with the
Laurel Law Office.
In their Answer[10] to the complaint, Castillo and Ginger Anne declared:
There is nothing wrong or objectionable to the statement that Asas services in the
guardianship case consisted in providing coffee and opening doors whenever there was a
conference at the Laurel Law Offices, as this was in fact the truth, the comportment being strictly
in accordance with long cherished Filipino hospitality, and he [Castillo] would have done the
same with his own visitors.[11] In any event, they claim that the assailed factual narration was
material and relevant to Castillos question why Asa was given the lions share of attorneys fees
when he had not rendered any known material service which redounded to the benefit of
the Nonan children.
Moreover, the Castillos declared that the deposit of the Nonan funds at the UCPB was
not attended with malice or bad faith, nor was it intended to benefit them as the funds could only
be withdrawn by Dr. Laurel who had exclusive access to all the information pertaining to the
interest and benefits accruing thereto.
As regards the assailed June 25, 2001 Reply to Answer filed with the Makati RTC in
Civil Case No. 01-506, the Castillos asserted that Castillo had no control nor influence over the
voluntary and spontaneous testimony of retired Justice Kalalo in his favor during the
proceedings adverted to.[12]
II. CBD Case No. 03-1108
Castillo subsequently filed a complaint[13] against Oliveros before the IBP, docketed
as CBD Case No. 03-1108, for gross violation of lawyers oath and the Code of Professional
Responsibility.
Castillo alleged that: (1) Oliveros assisted Cassiday in embezzling US $950,000
representing the share adjudicated to the Nonan heirs; (2) in conspiracy with Dr. Laurel and a
certain Atty. Douglas Cushnie, Oliveros resorted to forum shopping to undermine and defeat the
jurisdiction of the Philippine court in the guardianship proceedings; (3) Oliveros, along with Asa,
Dr. Laurel and Cassiday, perpetuated other acts of fraud in the guardianship proceedings; and
(4) Oliveros, together with Asa, deliberately and maliciously filed a groundless administrative
complaint against him and Ginger Anne.
In his Answer[14] to the Complaint in CBD Case No. 03-1108, Oliveros, decrying the
allegations against him as patently false, baseless and malicious, claimed that the complaint
was Castillos way of retaliating against him for having joined Asa in filing the administrative
complaint against him and Ginger Anne (CBD Case No. 03-1076).
III. CBD Case No. 03-1109
Castillo also filed an administrative complaint[15] against Asa before the IBP,
charging him with embezzlement, dishonesty, betrayal of trust, grave abuse of confidence and
violation of the lawyers oath and the Code of Professional Responsibility. The case was
docketed as CBD Case No. 03-1109.
Castillo alleged that (1) Asa, Cassiday and Dr. Laurel scandalously mismanaged the
estate of the Nonan heirs, the bulk of which they indiscriminately pocketed;
(2) Asa and Oliveros filed a groundless administrative complaint against him and Ginger Anne to
compel him to withdraw his claim for attorneys fees against Dr. Laurel and his bid to replace the
latter as guardian of the Nonanheirs; (3) despite an Agreement[16] dated February 16, 2000
between him and Asa that the latter would receive only 25% of whatever he (Castillo) would
receive as attorneys fees, Asa secretly pocketed the amounts of $24,500 and $160,500 from the
guardianship case on April 18, 2000; (4) Asa refused to account for and turn over the amount of
$130,000 in attorneys fees which belonged to him (Castillo); and (5) Asa embarked on a scheme
to force him into resigning as counsel for Dr. Laurel to enable them to exercise absolute control
over the guardianship case and appropriate for themselves the attorneys fees allocated for him.
In his Answer to the Complaint[17] in CBD Case No. 03-1109, Asa alleged as follows: It
was in fact Castillo who reneged on their February 16, 2000 Agreement as the latter had earlier
bluntly told him that he changed his mind and that he would not give him (Asa) any share in the
attorneys fees he would receive from the guardianship case, Castillo reasoning that he was the
therein counsel of record and had endorsed the case to the Laurel Law Offices. He thus reported
the matter to Dr. Laurel and informed him that he would likewise not give Castillos share in the
attorneys fees he [Asa] might receive because [Castillo] has no word of honor.[18]
As regards the $24,500 that he allegedly secretly pocketed, Asa explained that
several days prior to April 18, 2000, Dr. Laurel and Atty. Cassiday fixed the attorneys fees of
both Castillo and Asa at $100,000 each, based on the amount to be paid by the four heirs or
$25,000 per heir. When the first heir Merceditas Feliciano (Merceditas) paid $1,150,000 on April
18, 2000, he deposited $24,500 of this amount in his and his wifes joint Dollar Account No. 247-
702-9275 at the Philippine National Bank (PNB), Ortigas Branch as his share in the attorneys
fees, while he opened a new account in the name of Dr. Laurel to which he deposited the
amount of $160,500.
Asa went on to declare that Castillo received his own $25,000 plus interest amounting
to $25,023.13 representing full payment of his attorneys fees from Merceditas, as evidenced by
a Receipt[19] dated May 2, 2000 signed by Castillo.
Continuing, Asa declared that of the $160,500 belonging to Dr. Laurel, $100,000
represented partial payment for his consenting to be the guardian ad litem of the Nonan heirs
and $60,000 represented reimbursement for expenses incurred over several years by Dr. Laurel,
the total of which was placed temporarily on April 18, 2000 in his (Asas) Dollar Account No. 8-
250-00047-3 in RCBC. Dr. Laurel, however, withdrew $160,000.00 the following day from RCBC
and placed it in his own Dollar Time Deposit Account for which $500.00 was spent for the
purpose. A Certification[20] to this effect, issued by RCBC Ortigas Business Center Manager
Dolores L. Del Valle, was appended to Asas Answer.
Finally, Asa declared that Castillos claim for $130,000 in attorneys fees is baseless
and unconscionable, and that Castillo filed the complaint merely to harass him in retaliation for
the complaint he and Oliveros priorly filed against him and Ginger Anne.
IV. CBD Case No. 03-1125
On August 25, 2003, Asa filed yet another administrative complaint,[21] against
Castillo before the IBP, for disbarment/suspension, docketed as CBD Case No. 03-1125,
charging him with deceit, malpractice, gross misconduct in office, immoral conduct, violation of
the lawyers oath and the Code of Professional Responsibility in light of his baseless, malicious
and derogatory allegations in CBD Case No. 03-1109 which were founded on deceit and
deliberate falsehood, and of promoting a groundless, false and unlawful suit.
IBP REPORT AND RECOMMENDATION:
By Report and Recommendation[22] of February 27, 2004, the IBP CBD, through
Commissioner Rebecca Villanueva-Maala, recommended the dismissal of the consolidated
cases in this wise.
From the facts and evidence presented, what have been shown
by the counsels are mutualbickerings, unjustified recriminations and
 offensive personalities between brother lawyers which detract from the
dignity of the legal profession and do not deserve the attention of the
Commission.The voluminous case record contains but personal peculiarities
and idiosyncrasies hurled by the counsels against each other which
constitute highly unprofessional conduct. A great part of mans comfort, as
well as of his success at the bar, depends upon his relations with his
professional brethren.With them he is in daily necessary intercourse, and he
must have their respect and confidence, if he wishes to sail along in smooth
waters. Hence, the parties are advised to conduct themselves honorably,
fairly and candidly toward each other and try to maintain the dignity of the
legal profession.[23](Underscoring supplied)
By Resolution[24] of April 16, 2004, the Board of Governors of the IBP adopted and
approved the February 27, 2004 Report and Recommendation and dismissed the consolidated
cases for lack of merit.
The records of the cases were then forwarded for final action to this Court.
Asa filed with this Court an August 2, 2004 a Motion for Reconsideration[25] in CBD
Case No. 03-1125. He too, together with Oliveros, filed on August 3, 2004 a Motion for
Reconsideration[26] in CBD Case No. 03-1076.
Castillo likewise filed with this Court a Consolidated Omnibus Motion for Partial
Reconsideration[27] dated August 9, 2004 in CBD Case No. 03-1108 and CBD Case No. 03-
1109.
On January 12, 2005, Asa filed his Comment[28] on Castillos Consolidated Omnibus
Motion for Partial Reconsideration in CBD Case No. 03-1109 while also Oliveros filed his
Comment on the same motion on February 28, 2005.
On March 16, 2005, Castillo filed his Consolidated Reply to the Comments
of Asa and Oliveros, with Omnibus Motion to Appoint a Commissioner.[29]
THIS COURTS RULING
In his questioned Reply to Petitioner-Guardians Comment/Opposition, Castillos
statement reads:
x x x Atty. Leon Asa wants to be paid an additional $75,000.00 for
his services in providing coffee and opening the doors whenever there is a
conference at the Laurel Law Offices. He also conveniently provides himself
with the Nonan expediente to give assistance to the parties during their so-
called conferences. Worse, his express reluctance to appear before this
Honorable Court was repeatedly announced by Atty. Jose Oliveros because
of his so-called failing health x x x[30]
Canon 8 of the Code of Professional Responsibility mandates that a lawyer shall
conduct himself with courtesy, fairness and candor toward his professional colleagues and shall
avoid harassing tactics against opposing counsel. Rule 8.01 of the same Canon mandates that a
lawyer shall not, in his professional dealings, use language which is abusive, offensive or
otherwise improper.
That a member of the bar is enjoined to observe honorable, candid and courteous
dealing with other lawyers[31] and employ respectful and restrained language is in keeping with
the dignity of the legal profession.[32] It is through a scrupulous preference for respectful
language that a lawyer best demonstrates his observance or respect due to the courts and
judicial officers.[33]
In the case at bar, Castillo and Ginger Annes choice of words manifestly falls short of
this criterion. Their disparaging statements in the pleading referred to above belie their proffered
good intention and exceed the bounds of civility and propriety.
Castillos claim that the statement about Asas services is relevant and pertinent to the
claim for attorneys fees and was, for all legal intents and purposes, a privileged
communication[34] deserves short shrift. Indulging in offensive personalities in the course of
judicial proceedings constitutes unprofessional conduct subject to disciplinary action, even if the
publication thereof is privileged.[35]
x x x this Court will not be inhibited from exercising its supervisory
authority over lawyers who misbehave or fail to live up to that standard
expected of them as members of the Bar. Indeed, the rule of absolute
privileged communication absolves beforehand the lawyer from civil and
criminal liability based on the statements made in the pleadings. But like the
member of the legislature who enjoys immunity from civil and criminal
liability arising from any speech or debate delivered in the Batasan or in any
committee thereof, but nevertheless remains subject to the disciplinary
authority of the legislature for said speech or debate, a lawyer equally
remains subject to this Courts supervisory and disciplinary powers for lapses
in the observance of his duty as a member of the legal
profession.[36] (Underscoring supplied)
Castillo and Ginger Anne are thus ADMONISHED to exercise greater care and
circumspection in the preparation of their pleadings and refrain from using offensive or otherwise
improper language.
In support of Asa and Oliveros allegation that Castillo employed deceit and falsehood
in attempting to change the depositary bank for the funds to be held in trust by Dr. Laurel for
the Nonanheirs, they presented the March 2, 2000 RTC Order directing Dr. Laurel and his
principal counsel Castillo to deposit the balance of the proceeds of the settlement with any and
all of the adjudicated heirs with UCPB and the March 14, 2000 RTC Order directing the deposit
of the settlement proceeds with the RCBC.
A perusal of the Urgent Motion for Reconsideration dated March 8, 2000 signed by Dr.
Laurel, however, fails to establish any wrongdoing on the part of Castillo in having filed the
Motion to deposit the funds at UCPB. It simply stated that:
Considering the present raging controversy arising from the P50
Billion coconut levy funds, the stability of the United Coconut Planters Bank
(UCPB), Head Office at Makati, may be seriously affected x x x
The Petitioner-Guardian can best protect the deposits of
the Nonan children if the proceeds of the settlement will be deposited with a
solvent and more conservative bank like the RIZAL COMMERCIAL
BANKING CORPORATION (RCBC) x x x[37]
In administrative cases against lawyers, the quantum of proof required is clearly
preponderant evidence and the burden of proof rests upon the complainant. Moreover, an
administrative case against a lawyer must show the dubious character of the act done as well as
the motivation thereof.[38] In the case at bar, Asa and Oliveros failed to present clear and
preponderant evidence to show that Castillo willfully and deliberately resorted to deceit and
falsehood in filing the Motion to have the funds deposited at UCPB.
 Respecting Castillos June 25, 2001 Reply to Answer in the Makati RTC Civil Case No.
01-506, he therein alleged:
On the other hand, retired Justice Felipe Kalalo of the Court of
Appeals who personally knew the plaintiff, was also profuse in extolling his
academic credentials and accomplishments as a Trial lawyer, as follows:
Q: Do you know the claimant Atty. P.M. Castillo?
A: Yes sir, because we were both active Senior Trial lawyers
at the Laurel Law Offices.
Q: How could you characterize and rate the trial competency,
performance and expertise of Atty. P.M. Castillo?
A: He is highly competent, low key, aggressive and very
brilliant in the conduct of trial, as well as, in the
formulation of courtroom strategies. His pleadings are
also very well written, direct to the point, convincing,
scholarly and exhaustive. To be sure, he is one of the
popular trial lawyers of our firm (The Laurel Law
Offices), not only because he came from an exclusive
school, but also because of his scholastic records
at Ateneo de Manila was also impressive. That is why
he was taken in by former VP Salvador H. Laurel even
before the release of the 1964 bar where he was also
No. 2 among the Ateneo bar candidates for the year. He
was No. 15 among the bar topnotchers. This is not to
mention his impressive and highly (sic) batting average
of winning about 80% to 90% of his load cases and
work. He was also one of the busy lawyers of our office,
until he went on private practice and excelled as one of
the more successful and respected trial
practitioners.[39] (Underscoring supplied)
To Asa, by the foregoing allegation, Castillo committed clear falsehood for
Justice Kalalo had never been a lawyer at any time at the Laurel Law Offices.
Castillo explained, however, that he can only say that he has no control, nor influence
on the voluntary and spontaneous declaration and testimony of Retired Justice Felipe Kalalo of
the Court of Appeals in his favor during the highly adversarial proceedings.[40]
Castillos explanation does not impress, however. The records show that the above-
quoted statements attributed by Castillo to Justice Kalalo were lifted from an unsigned and
unsubscribed affidavit entitled Question and Answer Format in Lieu of Direct Testimony of
Justice Felipe Kalalo[41] dated January 21, 1993. This affidavit was earlier filed by Castillo with
the Pasig RTC, Branch 154 in connection with his claim for attorneys fees in Civil Cases Nos.
43049 and 56637 which affidavit was subsequently withdrawn, [42] however, as it was unsigned
and unsubscribed.
Canon 10 of the Code of Professional Responsibility provides that a lawyer owes
candor, fairness and good faith to the courts. Rule 10.01 of said Canon specifically commands
that a member of the bar shall not do any falsehood, nor consent to the doing of any in court; nor
shall he mislead, or allow the court to be misled by any artifice. Rule 10.02 of the same Canon
provides that a member of the bar shall not knowingly misquote or misrepresent the contents of
a paper or assert as a fact that which has not been proved.
And Section 20(d), Rule 138 of the Rules of Court directs that a lawyer must employ
such means only as are consistent with truth and honor, and never seek to mislead the judge or
any judicial officer by any artifice or false statement of fact or law. [43]
Complete candor or honesty is thus expected from lawyers, particularly when they
appear and plead before the courts.[44] They have an obligation to the court as well as to the
opposing party to make only truthful statements in their pleadings. [45] The burden cast on the
judiciary would be intolerable if it could not take at face value what is asserted by counsel. The
time that will have to be devoted just to the task of verification of allegations submitted could
easily be imagined.[46]
In light of the above findings reflecting Castillos administrative culpability, his charge
against Asa and Oliveros of filing groundless disbarment cases against him and Ginger Anne
necessarily fails.
As regards Castillos claim that Asa secretly pocketed $24,500 and $160,500, the
undated certification issued by RCBC Branch Operation Head Dolores del Valle reading:
This is to certify that on April 18, 2000, Mr. Leon L. Asa opened a
Dollar Savings Account at our Business Center. A credit was made to his
assigned Dollar Savings Account Number 8-250-00047-3 in the amount of
US Dollars: One Hundred Sixty Thousand Five Hundred (USD: 160,500.00)
as initial transaction. We further certify that on April 19, 2000, there was a
debit made for said account in the amount of US Dollars: One Hundred Sixty
Thousand (USD: 160,000.00) and that same amount was placed in the
Dollar Time Deposit Account of Salvador H. Laurel. Mr. Leon Asa left the
amount of USD: Five Hundred in his account to serve as the maintaining
balance requirement. Subject Dollar Savings Account had closed already,[47]
and Dr. Laurel Partial Inventory, Account and Report of Guardian[48] dated February 13,
2002 filed with the Angeles City RTC, Branch 59 in Sp. Proc. No. 5222 stating that:
3. On April 18, 2000, Guardian Ad Litem Salvador H. Laurel and
his Principal Foreign Legal Counsel, Atty. Benjamin Cassiday III received by
way of settlement from one of the duly adjudicated heirs of Larry
Lee Hillblom, Mercedita Feliciano, by and through her Guardian Ad Litem,
Milagros Feliciano, the amount of ONE MILLION ONE HUNDRED FIFTY
THOUSAND US DOLLARS (US$1,150,000.00) which was deposited with
the Rizal Commercial Banking Corporation (RCBC), St. Francis Square
Branch, Ortigas Center, Pasig City under Dollar Savings Account No. 8-250-
000430-ABA. Routing No. RCBC PH MM in the name of Salvador H. Laurel,
in trust for Honeylyn, Alexandra and Jeril Nonan, in compliance with the
Order of this Honorable Court dated April 26, 2000;
4. Pursuant to the above-stated Orders of this Honorable Court,
the Guardian Ad Litem and Atty. Benjamin Cassiday III disbursed the
following amounts for the purposes indicated:
A. ATTORNEYS FEES & OTHER NECESSARY LEGAL
EXPENSES:
xxxx
(7) Partial payment of the fee of Salvador H. Laurel for consenting
to be the guardian ad litemof the Nonan children and accepting all
responsibilities attached to said position .US$100,000.00

(8) Reimbursement to Salvador H. Laurel for expenses incurred
during the last six (6) years for airfare, car rentals, overseas calls, and
representation and other incidental expenses while in the various states in
the United States in order to pursue the claim of the Nonan children against
the Hillblom estate .US$60,000.00
x x x x[49] (Underscoring supplied),
validate Asas explanation that the amount of $160,500 belonged to Dr. Laurel but was merely
temporarily placed in his (Asas) account.
The Partial Inventory, Account and Report of Guardian shows that $12,500 was
received by Asa as attorneys fees for assisting Dr. Laurel and Castillo from 1996 to
2000.[50] Confirming such disbursement is a Receipt[51] dated April 18, 2000 signed by Asa. The
remaining $12,500 of the $25,000 attorneys fees of Asa per heir (as priorly agreed upon by Dr.
Laurel and Cassiday) were remitted by Asa to the Laurel Law Offices as Official Receipt No.
1766[52] issued by the treasurer/cashier of the Laurel Law Offices dated April 19, 2000 shows:
RECEIVED from Atty. Leon L. Asa the sum of Twelve thousand five hundred
US Dollars US$12,500.00 as fifty percent (50%) share of LLO [Laurel Law
Offices] in attorneys fees of US$25,000 of Atty. Asa in SP Proc. 5222 of
RTC Angeles City, Br. 59.
Cash.US$12,500-
By: Sgd.
Treasurer/Cashier
On Asas alleged unjust refusal to turn over Castillos attorneys fees: It appears
that Asa and Castillo each received $25,000 as attorneys fees but pursuant to their February
2000 Agreement, the aggregate amount of $50,000 would be divided between them, and Castillo
would receive 75% thereof or $37,500, while Asa would receive 25% or $12,500. The records
show that Asa kept only $12,500 for himself, he having remitted, as reflected above, the
remaining $12,500 to the Laurel Law Offices.
Dr. Laurel eventually gave Castillo $10,000 out of the $12,500 which Asa remitted to
the Laurel Law Offices, as reflected in the Partial Inventory, Account and Report of Guardian. [53]
Respecting Castillos claim that, in violation of the Code of Professional
Responsibility, Asaand Oliveros embarked on another sinister strategy to spite, insult and
provoke him to ostracize him and make him feel unwanted to continue as [Dr. Laurels] lawyer in
furtherance of their conspiracy to force him into resignation for them to replace him and have
absolute control over the guardianship case, the funds of the estate and the attorneys fees, the
same is unsubstantiated, hence, deserves no further consideration.
As to Castillos charge against Asa and Oliveros of embezzlement due to alleged
scandalous mismanagement of the estate of the Nonan heirs, premised on the October 13,
2003 RTC Order[54]in SP No. 5222, this Court finds the evidence presented insufficient to warrant
the imposition of sanctions against them.
Finally, on Castillos Omnibus Motion to Appoint a Commissioner, the matters raised
therein[55] being entirely inappropriate, to say the least, for consideration in these administrative
proceedings, the same is denied.
A final word. The spectacle of members of the bar being engaged in bickering and
recrimination is far from edifying. Mutual bickerings and unjustified recriminations between
brother attorneys detract from the dignity of the legal profession and will not receive any
sympathy from this Court.[56] Personal colloquies between counsels which promote unseemly
wrangling should thus be carefully avoided.[57]
It appears that Castillo had previously been suspended for Six (6) Months by this
Court in CBD Case No. 176, Bongalonta v. Castillo,[58] for committing falsehood in violation of his
lawyers oath and of the Code of Professional Responsibility. He was then warned that
commission of the same or similar offense in the future would call for the imposition of a more
severe penalty. This Court thus imposes upon him a penalty of suspension from the practice of
law for a period of One (1) year.
WHEREFORE, the administrative cases filed against Atty. Leon L. Asa and Atty. Jose
A. Oliveros are DISMISSED.
Atty. Ginger Anne Castillo is found GUILTY of breach of Canon 8 of the Code of
Professional Responsibility and is hereby admonished to refrain from using offensive and
improper language in her pleadings.
Atty. Pablito M. Castillo is likewise found GUILTY of breach of Canons 8, as well as
Canon 10 of the Code of Professional Responsibility, and is SUSPENDED from the practice of
law for a period of One (1) Year, effective upon receipt of this Decision.
Let copies of this Decision be entered in the respective personal records of Atty.
Ginger Anne Castillo and of Atty. Pablito M. Castillo in the Office of the Bar Confidant. Let copies
too be furnished the Integrated Bar of the Philippines.
SO ORDERED.
G.R. No. L-35469 October 9, 1987
ENCARNACION BANOGON, ZOSIMA MUNOZ, and DAVIDINA MUNOZ, petitioners,
vs.
MELCHOR ZERNA, CONSEJO ZERNA DE CORNELIO, FRANCISCO ZERNA, and the HON.
CIPRIANO VAMENTA, JR., Judge of the Court of First Instance of Negros Oriental (Branch
III).
CRUZ, J.:
It's unbelievable. The original decision in this case was rendered by the cadastral court way back
on February 9, 1926, sixty one years ago. A motion to amend that decision was filed on March 6,
1957, thirty one years later. This was followed by an amended petition for review of the judgment
on March 18, 1957, and an opposition thereto on March 26, 1957. On October 11, 1971, or after
fourteen years, a motion to dismiss the petition was filed. The petition was dismissed on
December 8, 1971, and the motion for reconsideration was denied on February 14, 1972. 1 The
petitioners then came to us on certiorari to question the orders of the respondent judge. 2
These dates are not typographical errors. What is involved here are errors of law and lawyers.
The respondent court dismissed the petition for review of the decision rendered in 1926 on the
ground that it had been filed out of time, indeed thirty one years too late. Laches, it was held,
had operated against the petitioners. 3
The petitioners contend that the said judgment had not yet become final and executory because
the land in dispute had not yet been registered in favor of the private respondents. The said
judgment would become so only after one year from the issuance of the decree of registration. If
any one was guilty of laches, it was the private respondents who had failed to enforce the
judgment by having the land registered in their the pursuant thereto. 4
For their part, the private respondents argue that the decision of February 9, 1926, became final
and executory after 30 days, same not having been appealed by the petitioners during that
period. They slept on their rights for thirty one years before it occurred to them to question the
judgment of the cadastral court. In fact, their alleged predecessor-in-interest, Filomeno Banogon,
lived for nineteen more years after the 1926 decision and did not see fit to challenge it until his
death in 1945. The herein petitioners themselves waited another twelve years, or until 195 7, to
file their petition for review. 5
While arguing that they were not guilty of laches because the 1926 decision had not yet become
final and executory because the land subject thereof had not yet been registered, the petitioners
rationalize: "If an aggrieved party is allowed the remedy of re-opening the case within one year
after the issuance of the decree, why should the same party be denied this remedy before the
decree is issued? 6
Why not indeed? Why then did they not file their petition earlier? Why do they now pretend that
they have all the time in the world because the land has not yet been registered and the one-
year reglementary period has not yet expired?
Thinking to support their position, the petitioners cite Rivera v. Moran 7 where it was held:
... It is conceded that no decree of registration has been entered and section
38 of the Land Registration Act provides that a petition for review of such a
decree on the grounds of fraud must be filed "within one year after entry of
the decree." Giving this provision a literal interpretation, it may first blush
seem that the petition for review cannot be presented until the final decree
has been entered. But on further reflection, it is obvious that such could not
have been the intention of the Legislature and that what it meant would
have been better expressed by stating that such petitioners must be
presented before the expiration of one year from the entry of the decree.
Statutes must be given a reasonable construction and there can be no
possible reason for requiring the complaining party to wait until the final
decree is entered before urging his claim of fraud. We therefore hold that a
petition for review under section 38, supra, may be filed at any time the
rendition of the court's decision and before the expiration of one year from
the entry of the final decree of registration. (Emphasissupplied).
A reading thereof will show that it is against their contentions and that under this doctrine they
should not have delayed in asserting their claim of fraud. Their delay was not only for thirty
one days but for thirty one years. Laches bars their petition now. Their position is clearly contrary
to law and logic and to even ordinary common sense.
This Court has repeatedly reminded litigants and lawyers alike:
"Litigation must end and terminate sometime and somewhere, and it is
assent essential to an effective and efficient administration of justice that,
once a judgment has become final, the winning party be not, through a mere
subterfuge, deprived of the fruits of the verdict. Courts must therefore guard
against any scheme calculated to bring about that result. Constituted as
they are to put an end to controversies, courts should frown upon any
attempt to prolong them."8
There should be a greater awareness on the part of litigants that the time of
the judiciary, much more so of this Court, is too valuable to be wasted or
frittered away by efforts, far from commendable, to evade the operation of a
decision final and executory, especially so, where, as shown in this case,
the clear and manifest absence of any right calling for vindication, is quite
obvious and indisputable. 9
This appeal moreover, should fail, predicated as it is on an insubstantial
objection bereft of any persuasive force. Defendants had to display
ingenuity to conjure a technicality. From Alonso v. Villamor, a 1910 decision,
we have left no doubt as to our disapproval of such a practice. The aim of a
lawsuit is to render justice to the parties according to law. Procedural rules
are precisely designed to accomplish such a worthy objective. Necessarily,
therefore, any attempt to pervert the ends for which they are intended
deserves condemnation. We have done so before. We do so again. 10
Regarding the argument that the private respondents took fourteen years to move for the
dismissal of the petition for review, it suffices to point out that an opposition thereto had been
made as early as March 26, 1957, or nine days after the filing of the petition. 11 Moreover, it was
for the petitioners to move for the hearing of the petition instead of waiting for the private
respondents to ask for its dismissal. After all, they were the parties asking for relief, and it was
the private respondents who were in possession of the land in dispute.
One reason why there is a degree of public distrust for lawyers is the way some of them
misinterpret the law to the point of distortion in a cunning effort to achieve their purposes. By
doing so, they frustrate the ends of justice and at the same time lessen popular faith in the legal
profession as the sworn upholders of the law. While this is not to say that every wrong
interpretation of the law is to be condemned, as indeed most of them are only honest errors, this
Court must express its disapproval of the adroit and intentional misreading designed precisely to
circumvent or violate it.
As officers of the court, lawyers have a responsibility to assist in the proper administration of
justice. They do not discharge this duty by filing pointless petitions that only add to the workload
of the judiciary, especially this Court, which is burdened enough as it is. A judicious study of the
facts and the law should advise them when a case, such as this, should not be permitted to be
filed to merely clutter the already congested judicial dockets. They do not advance the cause of
law or their clients by commencing litigations that for sheer lack of merit do not deserve the
attention of the courts.
This petition is DISMISSED, with costs against the petitioners. This decision is immediately
executory. It is so ordered.
G.R. No. L-22320 July 29, 1968
MERCEDES RUTH COBB-PEREZ and DAMASO P. PEREZ, petitioners,
vs.
HON. GREGORIO LANTIN, Judge of the Court of First Instance of Manila,
RICARDO P. HERMOSO and the CITY SHERIFF OF MANILA, respondents.
Crispin D. Baizas and Associates for petitioners.
Isidro T. Almeda for respondents.
CASTRO, J.:
This is a motion for partial reconsideration of this Court's decision of May 22, 1968, specifically
directed against the following observation therein made:
We feel compelled to observe that during the protracted litigation below, the
petitioners resorted to a series of actions and petitions, at some stages alternatingly,
abetted by their counsel, for the sole purpose of thwarting the execution of a simple
money judgment which has long become final and executory. Some of the actions
were filed, only to be abandoned or withdrawn. The petitioners and their counsel, far
from viewing courts as sanctuaries for those who seek justice, have tried to use them
to subvert the very ends of justice.
Corollarily, this Court assessed treble costs against the petitioners, to "be paid by their counsel.".
The herein movants, Attys. Crispin D. Baizas and A. N. Bolinas, counsels for the petitioners,
while submitting to the judgment on the merits, seek reconsideration of the decision in so far as
it reflects adversely upon their "professional conduct" and condemns them to pay the treble
costs adjudged against their clients.
At first blush, the motion for reconsideration presents a semblance of merit. After mature
deliberation and patient reprobing into the records of the case, however, we are of the firmer
conviction that the protracted litigation, alluded to in the above-quoted portion of our decision,
was designed to cause delay, and the active participation of the petitioners' counsels in this
adventure is patent.
After November 15, 1962 when the Court of Appeals rendered judgment sustaining Damaso
Perez' position with respect to the extent of the levy, the subsequent proceedings interposed
alternatingly by the petitioner spouses were obviously quixotic maneuvers expected to be
overthrown by the courts but calculated to delay an execution long overdue.
Had the petitioners and their counsels seriously believed that the levied shares of stock were
conjugal property, why did they not adopt this position from the very start, or, at the latest, in CA-
G.R. 29962-R, wherein Damaso Perez challenged the legality of the levy's coverage, in order to
end the litigation with reasonable dispatch? They chose, however, to attack the execution in a
piecemeal fashion, causing the postponement of the projected execution sale six times. More
than eight years after the finality of the judgment have passed, and the same has yet to be
satisfied.
In a determined effort to prolong the litigation, the Perez spouses, as represented by their
counsels, sought the issuance of preliminary injunctions to restrain the execution of the final
judgment in civil case 39407 from courts which did not have jurisdiction and which would, as
expected, initially or ultimately deny their prayer. For instance, after Damaso Perez bowed out
temporarily from the scene following the rendition of the aforementioned Court of Appeals
decision, his wife, Mercedez, Ruth Cobb-Perez, intruded into the controversy and asked for an
ex parte writ of preliminary injunction from the Court of First Instance of Rizal in connection with
civil case 7532 which she filed with the said court, knowing fully well that the basic civil case
39407 was decided by the Court of First Instance of Manila (Branch VII presided by the
respondent Judge Lantin), which latter court was the proper forum for any action relative to the
execution. Judge Eulogio Mencias of the Court of First Instance of Rizal, looking to Acosta vs.
Alvendia (L-14598, October 31, 1960), which held that courts of first instance have no power to
restrain acts outside their territorial jurisdictions, lifted on October 4, 1963 the ex parte writ which
he previously issued enjoining the respondent sheriff from carrying out the execution sale. It is
clear, however, that Mrs. Perez and her counsels, the movants, knew or ought to have known
beforehand that the Court of First Instance of Rizal did not have jurisdiction to issue the writ
which Mrs. Perez herself sought, and, anticipating the recall of the writ improvidently issued, on
September 3, 1963, a month before the said writ was actually lifted, filed in the basic civil case
39407 an urgent motion to lift the writ of execution issued on August 15, 1961, alleging as
justification the conjugal nature of the levied shares of stock and the personal nature of Damaso
Perez' judgment debt, the very same reasons advanced in civil case 7532 which was then still
pending in the Court of First Instance of Rizal. Incidentally, Mrs. Perez failed to adduce any
evidence in support of her aforesaid urgent motion, as in fact neither she nor her counsels
appeared during the scheduled hearing, prompting the respondent judge to issue the following
order:
When the urgent motion to recall or lift writ of execution was called this morning for
hearing, counsel for the movant did not appear despite the fact that he had been duly
notified of the motion for hearing. In view thereof the court assumes that he is waiving
his right to present evidence in support of his urgent motion to recall or lift writ of
execution. Said urgent motion is therefore deemed submitted for resolution.
Despite the recall of the aforementioned writ of injunction by Judge Mencias on a disclaimer of
jurisdiction (since the execution sought to be enjoined was ordered by another tribunal), Mrs.
Perez, now assisted by her husband who had staged a comeback, prayed for the issuance of
another injunction, this time from Branch XXII of the Court of First Instance of Manila (not the
same Branch which issued the controverted writ of execution), in connection with civil case
7532, then still pending in the Court of First Instance of Rizal. As most probably anticipated
anew by the Perez spouses and their counsels, Judge Alikpala, presiding judge of Branch XXII,
on November 8, 1963 denied the preliminary injunction sought, on the ground, among others,
that he had no power to interfere by injunction with the judgment or decree of a court of
concurrent or coordinate jurisdiction. On the very day the injunction was denied, Damaso Perez,
as if expecting the reversal from Judge Alikpala, was already prepared with another "remedy," as
in fact on that day, November 8, 1963, he filed in the basic civil case 39407 an "Urgent Motion
for Reconsideration" of the order of October 19, 1963, which denied his wife's above-mentioned
motion to recall the controverted writ of execution.
The foregoing motion, far from seriously seeking the reconsideration of the order of October 19,
1963, which in the first place Damaso Perez could not legally do for he was not even a party to
the denied "Urgent Motion to Recall Writ of Execution" (filed by his wife alone), was merely an
offer to replace the levied stocks with supposed cash dividends due to the Perez spouses as
stockholders in the Republic Bank.1 As a matter of fact, when the motion was set for hearing on
December 21, 1963, the counsels for Damaso Perez promised to produce the said cash
dividends within five days, but the promise was never fulfilled.2 Consequently, the respondent
Judge on January 4, 1964, denied the said motion for reconsideration.
The above exposition of the circumstances relative to the protracted litigation clearly negates the
avowal of the movants that "in none of the various incidents in the case at bar has any particular
counsel of petitioners acted with deliberate aforethought to delay the enforcement of the
judgment in Civil Case No. 39407." From the chronology of antecedent events, the fact becomes
inescapable that the Perez spouses, coached by their counsels, had sallied forth on a strategem
of "remedies" projected to foil the lawful execution of a simple money judgment. It is equally
obvious that they foreshadowed their own reversals in the "remedies" they ventured to adopt,
such that even before, one remedy had been exhausted, they interposed another until the case
reached this Court for the second time. 3 Meanwhile, justice was delayed, and more than one
member of this Court are persuaded that justice was practically waylaid.
The movants also contend that even this Court sanctions the aforesaid civil cases 7532 and
55292 as the "proper remedy" when we said that.
In reality, what they attacked is not the writ of execution, the validity and regularity of
which are unchallenged, but the levy made by the respondent Sheriff. In this regard,
the remedy is not the recall of the writ, but an independent action to enjoin the Sheriff
from proceeding with the projected sale, in which action the conjugal nature of the
levied stocks should be established as a basis for the subsequent issuance of a
permanent injunction, in the event of a successful claim. Incidentally, in the course of
the protracted litigation, the petitioners had already availed of this remedy in civil
cases 7532 and 55292, only to abandon it as they incessantly sought other, and often
simultaneous, devices of thwarting satisfaction of the judgment debt. (Emphasis
supplied) .
And because of this statement, they now counter that the said cases could not be branded as
having been instituted for delay.
The reference we made to civil cases 7532 and 55292 in the above-quoted statement must not
be considered out of context. We said that the petitioners incidentally had already availed of the
suggested remedy only in the sense that said civil cases 7532 and 55292
were apparently instituted to prove the conjugal nature of the levied shares of stocks in question.
We used the word incidentally advisedly to show that in their incessant search for devices to
thwart the controverted execution, they accidentally stumbled on the suggested remedy. But the
said civil cases were definitely not the "proper remedy" in so far as they sought the issuance of
writs of preliminary injunction from the Court of First Instance of Rizal and the Court of First
Instance of Manila (Branch XXII) where civil cases 7532 and 55292 were filed respectively, for
the said courts did not have jurisdiction to restrain the enforcement of the writ of execution
issued by the Court of First Instance of Manila (Branch VII) under the settled doctrines that
Courts are without power to restrain acts outside of their territorial jurisdiction 4 or interfere with
the judgment or decree of a court of concurrent or coordinate jurisdiction. 5 However, the recall
and the denial of the writs of preliminary injunction in civil cases 7532 and 55292 did not amount
to the termination or dismissal of the principal action in each case. Had the Perez spouses
desired in earnest to continue with the said cases they could have done so. But the fact is that
Mrs. Perez practically abandoned civil case 7532 when she instituted the above mentioned
urgent motion to recall writ of execution in the basic civil case 39407, anchored on the same
grounds which she advanced in the former case, until the said civil case 7532 was dismissed on
November 9, 1963, upon her own motion. Anent civil case 55292, the Perez spouses virtually
deserted the same when they instituted the herein petition for certiorari with urgent writ of
preliminary injunction based on the same grounds proffered in the said civil case — until the
latter was also dismissed on March 20, 1964, with the consent of the parties because of the
pendency then of the aforesaid petition for certiorari.
The movants further contend that "If there was delay, it was because petitioners' counsel
happened to be more assertive ... a quality of the lawyers (which) is not to be condemned."
A counsel's assertiveness in espousing with candour and honesty his client's cause must be
encouraged and is to be commended; what we do not and cannot countenance is a lawyer's
insistence despite the patent futility of his client's position, as in the case at bar.
It is the duty of a counsel to advise his client, ordinarily a layman to the intricacies and vagaries
of the law, on the merit or lack of merit of his case. If he finds that his client's cause is
defenseless, then it is his bounden duty to advise the latter to acquiesce and submit, rather than
traverse the incontrovertible. A lawyer must resist the whims and caprices of his client, and
temper his client's propensity to litigate. A lawyer's oath to uphold the cause of justice is superior
to his duty to his client; its primacy is indisputable.
The movants finally state that the "Petitioners have several counsel in this case but the
participation of each counsel was rather limited implying that the decision of this Court ordering
that "treble costs are assessed against the petitioners, which shall be paid by their counsel" is
not clear. The word "counsel" may be either singular or plural in construction, so that when we
said "counsel" we meant the counsels on record of the petitioners who were responsible for the
inordinate delay in the execution of the final judgment in the basic civil case 39407, after the
Court of Appeals had rendered its aforementioned decision of November 15, 1962. And it is on
record that the movants are such counsels. Atty. Bolinas, upon his own admission, "entered his
appearance in the case at bar about the time the Court of First Instance of Manila dismissed the
petitioners' Petition for Relief in Civil Case No. 39407," or about August 3, 1961 and even prior
to the Court of Appeals decision above-mentioned. Atty. Baizas claims that he "became
petitioners' counsel only in October, 1963 when he filed, with Atty. A.N. Bolinao, Jr. Civil Case
No. 55292 before the Court of First Instance of Manila presided by the Hon. Judge Alikpala
although it appears on record that the urgent motion to recall writ of execution filed by Mrs.
Perez in the basic civil case 39407 on September 3, 1963, was over the signature of one Ruby
Zaida of the law firm of "Crispin Baizas & Associates" as counsel for Mrs. Perez. It is to be
recalled that the said urgent motion is the same motion discussed above, which, curiously
enough, antedated by at least one month the lifting of the writ of preliminary injunction issued in
civil case 7532.
ACCORDINGLY, the motion for partial reconsideration is denied. Our decision of May 22, 1968
is hereby modified in the sense that Attys. Crispin D. Baizas and A.N. Bolinao, Jr. shall pay
jointly and severally the treble costs assessed against the petitioners.
G.R. No. L-77691 August 8,1988
PATERNO R. CANLAS, petitioner,
vs.
HON. COURT OF APPEALS, and FRANCISCO HERRERA, respondents.
Paterno R. Canlas Law Offices for petitioner.
Abalos, Gatdula & Bermejo for private respondent.
SARMIENTO, J.:
The case dramatizes the unpleasant spectacle of a lawyer tangling with his own client, more
often than not, in the matter of fees. The lawyer, the petitioner himself, would have his petition
decided on pure questions of procedure, yet, the Court cannot let pass unnoticed the murkier
face of the controversy, wherein the law is corrupted to promote a lawyer's selfseeking ends,
and the law profession, debased into a simple business dealing. Accordingly, we resolve it on
the basis not only of the questions raised by the petitioner pertaining to procedure, but
considering its serious ethical implications, on its merits as well.
We turn to the facts.
The private respondent was the registered owner of eight (six, according to the petitioner)
parcels of land located in Quezon City. 1 Between 1977 and 1978, 2 he obtained various loans
from the L & R Corporation, a financing institution, in various sums totalling P420,000.00 As
security therefor, he executed deeds of mortgage in favor of the corporation over the parcels
aforesaid. On August 28,1979, and upon the maturing of said loans, the firm caused an
extrajudicial foreclosure of mortgage following his failure to pay, as a consequence of which, the
said eight (six, according to the petitioner) parcels of land were disposed of at public auction, by the Sheriff of Quezon City and subject matter of the above Compromise
and in which L & R Corporation was itself the highest bidder. Agreement in Civil Case No. Q30679. . .10

Pending redemption, the private respondent filed a complaint for injunction against L & R
Corporation, to enjoin consolidation of title in its name, in which he succeeded in obtaining
preliminary injunctive relief. He was represented by the petitioner. Two years later, and with no
imminent end to the litigation in sight, the parties entered into a compromise agreement whereby
L & R Corporation accorded the private respondent another year to redeem the foreclosed
properties subject to payment of P600,000.00, with interest thereon at one per cent per month.
They likewise stipulated that the petitioner shall be entitled to attorney's fees of P100,000.00. On
November 19, 1982, the court 3 approved the compromise.
The private respondent, however, remained in dire financial straits — a fact the petitioner himself
concede 4 — for which reason he failed to acquire the finding to repay the loans in question, let
alone the sum of P100,000.00 in attorney's fees demanded by the petitioner. That
notwithstanding, the petitioner moved for execution insofar as his fees were concemed. The
court granted execution, although it does not appear that the sum was actually collected. 5
As a consequence, the private respondent caused the annotation of an adverse claim upon the
respective certificates of title embracing the properties. Upon learning of the same, the petitioner
moved for the cancellation of the adverse claim and for the issuance of a writ of possession. The
court granted both motions. The private respondent countered with a motion for a temporary
restraining order and later, a motion to recall the writ of possession. He likewise alleges that he
commenced disbarment proceedings before this Court against the petitioner 11 as well as various
criminal complaints for estafa, falsification, and "betrayal of trust" 12 with the Department of
Justice. On December 1, 1983, finally, he instituted an action for reconveyance and reformation
of document, 13praying that the certificates of title issued in the name of the petitioner be
cancelled and that "the Deed of Sale and Transfer of Rights of Equity of Redemption and/or to
Redeem dated May 3, 1983 ... be reformed to reflect the true agreement of Francisco Herrera
and Paterno R. Canlas, of a mortgage." 14 He vehemently maintains that the petitioner's
"agreement with [him] was that the latter would lend the money to the former for a year, so that
[petitioner] would have time to look for a loan for the wet market which [the petitioner] intended
to put up on said property." 15 Predictably, the petitioner moved for dismissal.

Sometime thereafter, the petitioner and the private respondent met to discuss relief for the latter
The trial court, however, denied the private respondent's petition. It held that the alteration
with respect to his liability to L & R Corporation on the one hand, and his obligation to the
complained of did not change the meaning of the contract since it was "well within [the
petitioner on the other. The petitioner contends that the private respondent "earnestly
petitioner's] rights" 16 "to protect and insure his interest of P654,000.00 which is the redemption
implored" 6 him to redeem the said properties; the private respondent maintains that it was the
price he has paid;" 17 secondly, that the petitioner himself had acquired an interest in the
petitioner himself who 'offered to advance the money," 7 provided that he, the private
properties subject of reconveyance based on the compromise agreement approved by Judge
respondent, executed a "transfer of mortgage" 8 over the properties in his favor. Who implored
Castro in the injunction case, pursuant to Section 29(b), of Rule 39, of the Rules of Court, that
whom is a bone of contention, but as we shall see shortly, we are inclined to agree with the
had, consequently, made him a judgment creditor in his own right; thirdly, that the private
private respondent's version, considering primarily the petitioner's moral ascendancy over his
respondent had lost all rights over the same arising from his failure to redeem them from L & R
client and the private respondent's increasing desperation.
Corporation within the extended period; and finally, that the petitioner cannot be said to have
violated the ban against sales of properties in custodia legis to lawyers by their clients pendente
The records further show that the parties, pursuant to their agreement, executed a "Deed of Sale lite, since the sale in question took place after judgment in the injunction case abovesaid had
and Transfer of Rights of Redemption and/or to Redeem," a document that enabled the attained finality. The complaint was consequently dismissed, a dismissal that eventually attained
petitioner, first, to redeem the parcels in question, and secondly, to register the same in his a character of finality.
name. The private respondent alleges that he subsequently filed loan applications with the
Family Savings Bank to finance a wet market project upon the subject premises to find,
Undaunted, the private respondent, on December 6, 1985, filed a suit for "Annulment Of
according to him, and to his dismay, the properties already registered in the name of the
Judgment 18 in the respondent Court of Appeals, 19 praying that the orders of Judge Castro: (1).
petitioner. He likewise contends that the "Deed of Sale and Transfer of Rights of Redemption
granting execution over the portion of the compromise agreement obliging the private
and/or to Redeem" on file with the Register of Deeds (for Quezon City) had been falsified as
respondent to pay the petitioner P100,000.00 as attorney's fees; (2) denying the private
follows:
respondent's prayer for a restraining order directed against the execution: and (3) denying the
motion to recall writ of possession, all be set aside.
WHEREFORE, for and in full settlement of the attorney's fees of
TRANSFEREE in the amount of ONE HUNDRED THOUSAND PESOS
The petitioner filed a comment on the petition, but followed it up with a motion to dismiss. On
(Pl00,000.00) I, FRANCISCO HERRERA, hereby transfer, assign and
December 8, 1986, the respondent Court of Appeals promulgated the first of its challenged
convey unto TRANSFEREE, Atty. Paterno R. Canlas, any and all my rights
resolutions, denying the motion to dismiss. On March 3, 1987, the Appellate Court denied
of the real properties and/or to redeem from the Mortgagee, L & R
reconsideration. 20
Corporation my mortgaged properties foreclosed and sold at public auction
by the Sheriff of Quezon City and subject matter of the above Compromise
Agreement in Civil Case No. Q30679 ... 9 Hence the instant petition.

whereas it originally reads: As we stated, the petitioner assails these twin resolutions on grounds of improper procedure.
Specifically, he assigns the following errors:
WHEREFORE, for and in full settlement of the attorney's fees of
TRANSFEREE in the amount of ONE HUNDRED THOUSAND PESOS I.
(P100,000.00), I, FRANCISCO HERRERA, hereby transfer, assign and
convey unto TRANSFEREE, Atty. Paterno R. Canlas, any and all my rights
of equity of redemption and/or to redeem from the Mortgagee, L & R
Corporation my mortgaged properties foreclosed and sold at public auction
THE RESPONDENT COURT GRAVELY ABUSE [sic] ITS DISCRETION IN NOT DISMISSING
AC G.R. NO. 07860 ON THE GROUND THAT IT IS IN REALITY A PETITION FOR
CERTIORARI FILED OUT OF TIME AND SHOULD NOT BE GIVEN DUE COURSE.
II.
THE RESPONDENT COURT GRAVELY ABUSE [sic] ITS DISCRETION IN NOT DISMISSING
AC G.R. NO. 07860 ON THE GROUND OF RES JUDICATA
III.
THE RESPONDENT COURT GRAVELY ABUSE [sic] ITS DISCRETION IN NOT
CONSIDERING AC G. R. 07860 AS MOOT AND ACADEMIC SINCE PETITIONER HAD
DISPOSED OF THE SUBJECT PROPERTIES LONG BEFORE THE FILING OF THIS SUIT.
IV
THE RESPONDENT COURT GRAVELY ABUSED ITS DISCRETION IN NOT DENYING
PETITIONER'S MOTION TO DISMISS SOLELY ON THE GROUND THAT THE ARGUMENT
RAISED THEREIN ARE BUT REHASH OF THE ARGUMENTS IN HIS COMMENT TO THE
PETITION. 21
The petitioner argues that the petition pending with the respondent court "is actually a petition for
certiorari," 22disguised as a pleading for annulment of judgment and that in such a case, it faces
alleged legal impediments (1) It had been filed out of time, allegedly two years from the issuance
of the assailed orders, and (2) It was not preceded by a motion for reconsideration. He adds that
assuming annulment of judgment were proper, no judgment allegedly exists for annulment, the
aforesaid two orders being in the nature of interlocutory issuances.
On purely technical grounds, the petitioner's arguments are impressive. Annulment of judgment,
we have had occasion to rule, rests on a single ground: extrinsic fraud. What "extrinsic fraud"
means is explained in Macabingkil v. People's Homesite and Housing Corporation : 23
xxx xxx xxx
It is only extrinsic or collateral fraud, as distinguished from intrinsic fraud,
however, that can serve as a basis for the annulment of judgment. Fraud
has been regarded as extrinsic or collateral, within the meaning of the rule,
"where it is one the effect of which prevents a party from having a trial, or
real contest, or from presenting all of his case to the court, or where it
operates upon matters pertaining, not to the judgment itself, but of the
manner in which it was procured so that there is not a fair submission of the
controversy." In other words, extrinsic fraud refers to any fraudulent act of
the prevailing party in the litigation which is committed outside of the trial of
the case, whereby the defeated party has been prevented from exhibiting
fully his side of the case, by fraud or deception practiced on him by his
opponent. 24
A perusal of the petition of therein private respondent Herrera pending before the respondent
Court reveals no cause of action for annulment of judgment. In the first place, and as herein
petitioner Canlas correctly points out, the judgment itself is not assailed, but rather, the orders
merely implementing it. Secondly, there is no showing that extrinsic fraud,
as Makabingkil defines it, indeed vitiated the proceedings presided over by Judge Castro. On the
contrary, Herrera's petition in the respondent court will show that he was privy to the incidents he
complains of, and in fact, had entered timely oppositions and motions to defeat Atty. Canlas'
claims under the compromise agreement.
What he objects to is his suspected collusion between Atty. Canlas and His Honor to expedite
the former's collection of his fees. He alleges that his counsel had deliberately, and with
malevolent designs, postponed execution to force him (Herrera) to agree to sell the properties in
controversy to him (Atty. Canlas) subject to redemption. ("...[I]t was understandable that
respondent Atty. Paterno R. Canlas did not implement the writ of execution, instead he
contacted petitioner in order that petitioner would sign the questioned documents. This was the
clincher of the plan of respondent Atty, Paterno R. Canlas to divest petitioner of his properties.
For this purpose, it is obvious that respondent Atty. Paterno R. Canlas had to conspire with the
respondent court judge to achieve his plan." 25) Aside from being plain speculation, it is no
argument to justify annulment. Clearly, it does not amount to extrinsic fraud as the term is
defined in law.
Neither is it proper for the extraordinary remedy of certiorari. Certiorari presupposes the absence
of an appeal 26 and while there is no appeal from execution of judgment, appeal lies in case of
irregular implementation of the writ. 27 In the case at bar, there is no irregular execution to speak
of As a rule, "irregular execution" means the failure of the writ to conform to the decree of the
decision executed. 28 In the instant case, respondent Herrera's charges, to wit, that Judge Castro
had erred in denying his motions for temporary restraining order and to recall writ of possession,
or that His Honor had acted hastily (". . . that respondent court/judge took only one [1) day to
resolve petitioner's motion for issuance of [a] [restraining] order. . ." 29) in denying his twofold
motions, do not make out a case for irregular execution. The orders impugned are conformable
to the letter of the judgment approving the parties'compromise agreement.
The lengths the private respondent, Francisco Herrera, would go to in a last-ditch bid to hold on
to his lands and constraints of economic privation have not been lost on us. It is obvious that he
is uneasy about the judgment on compromise itself, as well as the subsequent contract between
him and his lawyer. In such a case, Article 2038 of the Civil Code applies:
Art. 2038. A compromise in which there is mistake, fraud, violence
intimidation, undue influence, or falsity of documents, is subject to the
provisions of article 1330 of this Code ...
in relation to Article 1330 thereof:
Art. 1330. A contract where consent is given through mistake, violence,
intimidation, undue influence, or fraud is voidable.
in relation to its provisions on avoidance of'contracts. 30 The court notes that he had, for this
purpose, gone to the Regional Trial Court, a vain effort as we stated, and in which the decision
had become final.
We, however, sustain Atty. Canlas' position-on matters of procedure — for the enlightenment
solely of the bench and the bar. It does not mean that we find merit in his petition. As we have
intimated, we cannot overlook the unseemlier side of the proceeding, in which a member of the
bar would exploit his mastery of procedural law to score a "technical knockout" over his own
client, of all people. Procedural rules, after all, have for their object assistance unto parties "in
obtaining just, speedy, and inexpensive determination of every action and proceeding." 31If
procedure were to be an impediment to such an objective, "it deserts its proper office as an aid
 32
to justice and becomes its great hindrance and chief enemy." It was almost eight decades ago
that the Court held:
... A litigation is not a game of technicalities in which one, more deeply
schooled and skilled in the subtle art of movement and position, entraps and
destroys the other. It is, rather, a contest in which each contending party
fully and fairly lays before the court the facts in issue and then, brushing
aside as wholly trivial and indecisive all imperfections of form and
technicalities of procedure, asks that justice be done upon the merits.
Lawsuits, unlike duels, are not to be won by the a rapier's thrust ... 33
It is a ruling that almost eight decades after it was rendered, holds true as ever.
By Atty. Canlas' own account, "due to lack of paying capacity of respondent Herrera, no
financing entity was willing to extend him any loan with which to pay the redemption price of his
mortgaged properties and petitioner's P100,000.00 attorney's fees awarded in the Compromise
Judgment," 34 a development that should have tempered his demand for his fees. For obvious
reasons, he placed his interests over and above those of his client, in opposition to his oath to
"conduct himself as a lawyer ... with all good fidelity ... to [his] clients." 35 The Court finds the
occasion fit to stress that lawyering is not a moneymaking venture and lawyers are not
merchants, a fundamental standard that has, as a matter of judicial notice, eluded not a few law
advocates. The petitioner's efforts partaking of a shakedown" of his own client are not becoming
of a lawyer and certainly, do not speak well of his fealty to his oath to "delay no man for
money." 36
It is true that lawyers are entitled to make a living, in spite of the fact that the practice of law is
not a commercial enterprise; but that does not furnish an excuse for plain lust for material
wealth, more so at the expense of another. Law advocacy, we reiterate, is not capital that yields
profits. The returns it births are simple rewards for a job done or service rendered. It is a calling
that, unlike mercantile pursuits which enjoy a greater deal of freedom from government
interference, is impressed with a public interest, for which it is subject to State
regulation. 37 Anent attomey's fees, section 24, of Rule 138, of the Rules, provides in part as
follows:
SEC. 24. Compensation of attorneys, agreement as to fees. — An attorney
shall be entitled to have and recover from his client no more than a
reasonable compensation for his services, with a view to the importance of
the subject matter of the controversy, the extent of the services rendered,
and the professional standing of the attorney... A written contract for
services shall control the amount to be paid therefor unless found by the
court to be unconscionable or unreasonable.
So also it is decreed by Article 2208 of the Civil Code, reproduced in part, as follows:
Art. 2208 ...
In all cases, the attorney's fees and expenses of litigation must be
reasonable.
We do not find the petitioner's claim of attorney's fees in the sum of P100,000.00 reasonable.
We do not believe that it satisfies the standards set forth by the Rules. The extent of the services
he had rendered in Civil Case No. 30679, and as far as the records will yield, is not impressive
to justify payment of such a gargantuan amount. The case itself moreover did not involve
complex questions of fact or law that would have required substantial effort as to research or leg
work for the petitioner to warrant his demands. The fact that the properties subject thereof
commanded quite handsome prices in the market should not be a measure of the importance or
non-importance of the case. We are not likewise persuaded that the petitioner's stature warrants
the sum claimed.
All things considered, we reduce the petitioner's fees, on a quantum meruit basis, to P20,000.00.
It is futile to invoke the rule granting attorneys a lien upon the things won in litigation similar to
that vested upon redemptioners. 38 To begin with, the rule refers to realty sold as a result of
execution in satisfaction of judgment. In this case, however, redemption was decreed by
agreement (on compromise) between the mortgagor and mortgagee. It did not give the petitioner
any right to the properties themselves, much less the right of redemption, although provisions for
his compensation were purportedly provided. It did not make him a redemptioner for the plain
reason that he was not named one in the amicable settlement. To this extent, we reverse Judge
Pedro Santiago's ruling in Civil Case No. 40066, recognizing Atty. Canlas' "legal right,
independent of the questioned deed of sale and transfer which was executed subsequently on
May 3, 1983, to redeem the subject realty from the L & R Corporation pursuant to Sec. 29 (b),
Rule 39 of the Rules of Court." 39 Whatever right he had, it was, arguably with respect alone to
his renumeration. It did not extend to the lands.
Secondly, and assuming that such a right exists, it must be in proportion to the "just fees and
disbursements" 40 due him. It is still subject to the tempering hand of this Court.
The Court notes a hidden agenda in the petitioner's haste to execute the compromise agreement
and subsequently, to force the transfer of the properties to himself. As we have observed, in
spite of the issuance of the writ of execution, it does not appear that the petitioner took pains to
implement it. We find this perplexing given his passionate and persistent pleas that he was
entitled to the proceeds. There can indeed be no plausible explanation other than to enable him
to keep an "ace" against the private respondent that led finally, to the conveyance of the
properties in his favor. To be sure, he would have us beheve that by redeeming the same from
the mortgagee and by in fact parting with his own money he had actually done the private
respondent a favor, but this is to assume that he did not get anything out of the transaction.
Indeed, he himself admits that "[t]itles to the properties have been issued to the new owners long
before the filing of private respondents [sic] petition for annulment." 41 To say that he did not
profit therefrom is to take either this Court or the petitioner for naive, a proposition this Court is
not prepared to accept under the circumstances.
We are likewise convinced that it was the petitioner who succeeded in having the private
respondent sign the "Deed of Sale and Transfer of Rights of Equity of Redemption and/or to
Redeem," a pre-prepared document apparently, that allowed him (the petitioner) to exercise the
right of redemption over the properties and to all intents and purposes, acquire ownership
thereof. As we have earlier averred, the private respondent, by reason of bankruptcy, had
become an easy quarry to his counsel's moral influence and ascendancy. We are hard put to
believe that it was the private respondent who "earnestly implored" 42 him to undertake the
redemption amid the former's obstinate attempts to keep his lands that have indeed led to the
multiple suits the petitioner now complains of, apart from the fact that the latter himself had
something to gain from the transaction, as alluded to above. We are of the opinion that in ceding
his right of redemption, the private respondent had intended merely to forestall the total loss of
the parcels to the mortgagee upon the understanding that his counsel shall acquire the same
and keep them therefore within reach, subject to redemption by his client under easier terms and
conditions. Surely, the petitioner himself would maintain that he agreed to make the
redemption"in order that [he] may already be paid the P100,000.00 attorney's fees awarded him
in the Compromise Agreement," 43 and if his sole concern was his fees, there was no point in
keeping the properties in their entirety.
The Court simply cannot fag for the petitioner's pretensions that he acquired the properties as a
gesture of magnanimity and altruism He denies, of course, having made money from it, but what
he cannot dispute is the fact that he did resell the properties. 44
But if he did not entertain intents of making any profit, why was it necessary to reword the
conveyance document executed by the private respondent? It shall be recalled that the deed, as
originally drafted, provided for conveyance of the private respondent's "rights of equity of
redemption and/or redeem" 45 the properties in his favor, whereas the instrument registered with
the Register of Deeds purported to transfer "any and all my rights of the real properties and/or to
redeem," 46 in his favor. He admits having entered the intercalations in question but argues that
he did so "to facilitate the registration of the questioned deed with the Register of Deeds" 47 and
that it did not change the meaning of the paper, for which Judge Santiago acquitted him of any
falsification charges. 48 To start with, the Court is at a loss how such an alteration could
"facilitate" registration. Moreover, if it did not change the tenor of the deed, why was it necessary
then? And why did he not inform his client? At any rate, the agreement is clearly a contract of
adhesion. Its provisions should be read against the party who prepared it.
But while we cannot hold the petitioner liable for falsification — this is not the proper occasion for
it — we condemn him nonetheless for infidelity to his oath "to do no falsehood" 49
This brings us to the final question: Whether or not the conveyance in favor of the petitioner is
subject to the ban on acquisition by attorneys of things in litigation. The pertinent provisions of
the Civil Code state as follows:
Art. 1491. The following persons cannot acquire by purchase, even at a
public or judicial action, either in person or through the mediation of another:
(1) The guardian, the property of the person or persons who may be under
his guardianship;
(2) Agents, the property whose administration or sale may have been
intrusted to them, unless the consent of the principal have been given;
(3) Executors and administrators, the property of the estate under
administration;
(4) Public officers and employees, the property of the State or of any
subdivision thereof, or of any government owned or controlled corporation,
or institution, the administration of which has been instrusted to them; this
provision shall apply to judges and government experts who, in any manner
whatsoever, take part in the sale;
(5) Justice judges prosecuting attorneys clerks of superior and inferior
courts, and other officers and employees connected with the administration
of justice, the property and rights in litigation or levied upon an execution
before the court within whose jurisdiction or territory they exercise their
respective functions; this prohibition includes the act of acquiring by
assignment and shall apply to lawyers, with respect to the property and
rights which may be the object of any litigation in which they may take part
by virtue of their profession.
(6) Any others specially disqualified by law.**
In Rubias v. Batiller, 50 we declared such contracts to be void by force of Article 1409, paragraph
(7), of the Civil Code, defining inexistent contracts. In Director of Lands v. Ababa 51 however, we
said that the prohibition does not apply to contingent contracts, in which the conveyance takes
place after judgment, so that the property can no longer be said to be "subject of litigation."
In the instant case, the Court observes that the "Deed of Sale and Transfer of Rights of Equity of
Redemption and/or to Redeem" was executed following the finality of the decision approving the
compromise agreement. It is actually a new contract — not one in pursuance of what had been
agreed upon on compromise — in which, as we said, the petitioner purportedly assumed
redemption rights over the disputed properties (but in reality, acquired absolute ownership
thereof). By virtue of such a subsequent agreement, the lands had ceased to be properties
which are "the object of any litigation." Parenthetically, the Court states that a writ of possession
is improper to eject another from possession unless sought in connection with: (1) a land
registration proceeding; (2) an extrajudicial foreclosure of mortgage of real property; (3) in a
judicial foreclosure of property provided that the mortgagor has possession and no third party
has intervened; and (4) in execution sales. 52 It is noteworthy that in this case, the petitioner
moved for the issuance of the writ pursuant to the deed of sale between him and the private
respondent and not the judgment on compromise. (He was, as we said, issued a writ of
execution on the compromise agreement but as we likewise observed, he did not have the same
enforced. The sale agreement between the parties, it should be noted, superseded the
compromise.) The writ does not lie in such a case. His remedy is specific performance.
At any rate, the transfer, so we hold, is not subject to the injunction of Article 1491 of the Civil
Code. But like all voidable contracts, it is open to annulment on the ground of mistake, fraud, or
undue influence, 53 which is in turn subject to the right of innocent purchasers for value. 54
For this reason, we invalidate the transfer in question specifically for undue influence as earlier
detailed. While the respondent Herrera has not specifically prayed for invalidation, this is the
clear tenor of his petition for annulment in the Appellate Court. It appearing, however, that the
properties have been conveyed to third persons whom we presume to be innocent purchasers
for value, the petitioner, Atty. Paterno Canlas, must be held liable, by way of actual damages, for
such a loss of properties.
We are not, however, condoning the private respondent's own shortcomings. In condemning
Atty. Canlas monetarily, we cannot overlook the fact that the private respondent has not settled
his hability for payment of the properties. To hold Atty. Canlas alone liable for damages is to
enrich said respondent at the expense of his lawyer. The parties must then set off their
obligations against the other. To obviate debate as the actual amounts owing by one to the
other, we hold Francisco Herrera, the private respondent, liable to Atty. Paterno Canlas, the
petitioner, in the sum of P654,000.00 representing the redemption price of the properties, 55 in
addition to the sum of P20,000. 00 as and for attomey's fees. We order Atty. Canlas, in turn, to
pay the respondent Herrera the amount of P1,000,000.00, the sum he earned from the resale
thereof, 56 such that he shall, after proper adjustments, be indebted to his client in the sum of
P326,000.00 as and for damages.
Needless to say, we sustain the action of the respondent Court of Appeals in taking cognizance
of the petition below. But as we have stated, we are compelled, as the final arbiter of justiciable
cases and in the highest interests ofjustice, to write finis to the controversy that has taxed
considerably the dockets of the inferior courts.
Let the Court further say that while its business is to settle actual controversies and as a matter
of general policy, to leave alone moot ones, its mission is, first and foremost, to dispense justice.
At the outset, we have made clear that from a technical vantage point, certiorari, arguably lies,
but as we have likewise stated, the resolution of the case rests not only on the mandate of
technical rules, but if the decision is to have any real meaning, on the merits too. This is not the
first time we would have done so; in many cases we have eschewed the rigidity of the Rules of
Court if it would establish a barrier upon the administration ofjustice. It is especially so in the
case at bar, in which no end to suit and counter-suit appears imminent and for which it is high
time that we have the final say. We likewise cannot, as the overseer of good conduct in both the
bench and the bar, let go unpunished what convinces us as serious indiscretions on the part of a
lawyer.
WHEREFORE, judgment is hereby rendered.
1. ORDERING the petitioner, Atty. Patemo Canlas, to pay to the private respondent, Francisco
Herrera, the sum of P326,000.00, as and for damages;
2. ORDERING the petitioner to SHOW CAUSE why no disciplinary action may be imposed on
him for violation of his oath, as a lawyer, within ten (10) days from notice, after which the same
will be consolidated with AC No. 2625;
3. DISMISSING this petition and REMANDING the case to the respondent Court of Appeals for
execution; and
4. ORDERING the petitioner to pay costs.
SO ORDERED.
CANON 11
G.R. No. L-42032 January 9, 1976
IN THE MATTER OF THE PRODUCTION OF THE BODY OF MANUEL DE GRACIA ON A
WRIT OF HABEAS CORPUS. MANUEL DE GRACIA, petitioner,
vs.
THE WARDEN, MUNICIPAL JAIL, Makati, Rizal; THE PROVINCIAL WARDEN, PROVINCIAL
JAIL, Pasig, Rizal; HON. REYNALDO P. HONRADO, Judge of the Court of First Instance of
Rizal, Branch XXV, Pasig, Rizal; and MARCIANO P. STA. ANA, Assistant Provincial Fiscal,
Pasig, Rizal, respondents.
FERNANDO, J.:
It is settled law-that habeas corpus is the appropriate remedy for release from confinement of a
person who has served his sentence. 1 It i s on such a doctrine that reliance is placed by
petitioner Manuel de Gracia in this application for the issuance of such a writ. It is undisputed
that while the information against petitioner charged him with the commission of frustrated
homicide to which he pleaded not guilty, it was later amended to one of serious physical injuries.
It is to such lesser offense that on September 10, 1971, he entered a plea of guilty. On the very
same day, respondent Judge Reynaldo P. Honrado imposed upon him the penalty of four
months and one day of arrests mayor without subsidiary imprisonment in case of insolvency.
That period of confinement he had duly served by November 10, 1975, considering that he had
been under detention since July 18, 1975. 2 This notwithstanding, the petition alleged that he
was not set free, the reason being that on November 19, 1975, the last day of the prison term
imposed upon him, "respondent Assistant Provincial Fiscal Marciano P. Sta. Ana filed with the
respondent Judge, in the very same case where your petitioner was convicted and for which he
served sentence, Criminal Case No. 15289, a 'Motion to Order the Warden to Hold the Release
of Manuel de Gracia (your petitioner)' alleging as a ground that the 'father of the victim, Gilberts
Valenzuela, informed the movant (respondent Asst. Fiscal, not the People of the Philippines),
that the victim in the above-entitled case died and for this reason the undersigned will file an
amended information. 3 Then came this paragraph in the petition: "That on the following day,
November 20, 1975, the respondent Judge, despite the clear and incontrovertible fact that he
had no jurisdiction to act on said motion because the case had long been terminated and his
decision therein had already been executed, and, further, even assuming that the respondent
Judge could still act in the case, he could not and should not act on the Fiscal's motion because
the same was not set for hearing and no copy thereof was furnished to your petitioner whose
very liberty was being sought to be deprived, still [he] persisted in acting upon the Fiscal's
motion and granted the same 'in the interest of justice,' not at all minding that your petitioner,
while maybe a convict in the eyes of the respondent Judge, is still entitled to due process of law
and to some justice; ...." 4 There was a motion for reconsideration, but it was fruitless. 5 Hence
this petition.
On December 8, 1975, this Court issued the following resolution: "The Court [issued] the writ of
habeas corpus returnable to this Court on Friday, December 12, 1975 and required the
respondents to make a [return] of the writ not later than the aforesaid date. The Court further
Resolved: (a) to set this case for hearing on Monday, December 15, 1975 at 10:30 a.m.; and (b)
to [grant] the motion of petitioner to litigate as pauper in this case." 6 On the date set for hearing,
respondent Judge Reynaldo P. Honrado filed his return, worded as follows: "1. That the
petitioner Manuel de Gracia has already been ordered released by this court per order dated
December 11, 1975, in view of the fact that Trial Fiscal Marciano P. Sta. Ana, Jr. has not as of
this time filed the amended information for Homicide after the death of Florante Valenzuela, the
offended party in this case, notwithstanding his motion entitled 'Motion to Order the Warden to
hold the Release of Manuel de Gracia dated November 19, 1975, ...; 2. That in view of the
release from custody of Manuel de Gracia, the present petition for habeas corpus has become
moot and academic. ..." 7 Fiscal of Rizal, did likewise. The return stated: "1. That the
Respondent Marciano P. Sta. Ana, Jr., the Assistant Provincial petitioner is not in his custody or
power although, as alleged in the petition, it was upon his motion that the respondent Judge
issued the Order ... ordering the warden to hold the release of the accused (herein petitioner). 2.
That the reason for his said motion ... is, as stated therein, that he was informed of the death of
the victim and he was going to file an amended information. 3. That because of the necessity for
immediate action so as to avoid the accused being released so that he could be held to answer
for a crime of homicide, and in the honest belief at that time that the proper remedy was the filing
of an amended information for homicide, the undersigned filed the motion on said ground. The
information concerning the death of the victim was given to the undersigned by the victim's
father only on November 19, 1975, the last day of confinement of the accused. However, after
being able to study the applicable rule and jurisprudence, the undersigned concluded that the
proper remedy is not amendment of the information because judgment had already been
rendered on the first information, but the filing of a new information for homicide upon the
authority of this Honorable Court's ruling in People v. Manolong, and It is similar cases. 8
As no return of the writ had been filed on the date set for hearing by respondent wardens, a
resolution of the following tenor was adopted by this Court: "When this case was called for
hearing this morning, Atty. Salvador N. Beltran appeared for the petitioner while Assistant
Provincial 'Fiscal Marciano P. Sta. Ana, Jr. and Major o Maristela appeared for the respondents.
Thereafter, the Court Resolved (a) to require Assistant Provincial Fiscal Marciano P. Sta. Ana,
Jr. to file a [return] of the writ for the respondent wardens not later than 10:30 a.m. of
Wednesday, December 17, 1975; and (b) to [reset] the hearing of this case on the aforesaid
date and time. 9 It should be stated likewise that Major Edgardo Maristela assured the Court that
petitioner had been release What was declared orally by him was thereafter set forth in writing in
accordance with his return dated December 16, 1975: II That on Sept. 18, 1975, the Office of the
Provincial Warden received a commitment order issued by Judge Reynaldo Honrado, dated 16
September 1975, ...; IV. That by virtue 6f that commitment order which the petitioner was
sentenced to suffer the penalty of from four (4) months and one (1) day, he was transferred to SPOUSES PEDRO M. REGALADO and ZANITA F. G.R. No. 134154
Makati Municipal Jail, on Sept. 18, 1975, to service his prison term thereat pursuant to REGALADO, Present:
Presidential Decree No. 29 as said prisoner is classified as Municipal prisoner; V That the Petitioners,
petitioner was brought back and confined again to the Rizal Provincial Jail on Dec. 3, 1975, by PUNO, J., Chairperson,
virtue of Remittance order issued by Judge Pedro Revilla, Executive Judge CFI Rizal dated Dec. SANDOVAL-GUTIERREZ
3, 1975, ...; VI. That on December 12, 1975, the Office of the Provincial Warden of Rizal CORONA,
received an Order from the Court of First Instance of Rizal presided by Honorable Judge - versus - AZCUNA, and
Reynaldo Honrado, directing him to release Manuel de Gracia, the petitioner in this case; VII. GARCIA, JJ.
That by virtue of odd order ... and the Order of Release, ... the undersigned respondent released
on said date the petitioner as evidenced by certificate of discharge from prison and that is the Promulgated:
reason why he cannot produce the body of said person before this Honorable Court; VIII That he ABRAHAM M. REGALADO, CIRILO M. REGALADO,
was not able to make the return of the writ immediately on the ground that he was at that time ISIDRO M. REGALADO, CIRIACO M. REGALADO,
confined in the hospital, and he was d only on December 13, 1975." 10 There was likewise a JORGE M. REGALADO, JULIANA R. ABELLO, February 28, 2006
return of the writ on such a date on behalf of respondent Cresencio T. Pimentel, Municipal LUCIO M. REGALADO, and APOLONIO M.
Warden of Makati, Rizal. It was therein declared: "1. That the petitioner was not in his custody REGALADO, JR.,
when he received copy of the petition as the petitioner was transferred to 'the Rizal Provincial Respondents.
Jail on December 3, 1975, as he was going to be charged with the crime of homicide and
'therefore, his confinement has to be in the Rizal Provincial Jail and that by virtue of said
transfer, respondent Municipal Warden could not produce the body of the 'petitioner before this-
Honorable Court."11

On the morning Deeember 17, 1975, respondent Assistant Provincial Fiscal Marciano P. Sta.
Ana, Jr. and the two aforesaid wardens appeared. Neither petitioner nor his counsel, Salvador
N. Beltran, was present. There was this manifestation though: '[Petitioner thru counsel,
respectfully manifests that he has already been released from confinement, for which reason the
present petition has been rendered moot and academic .... 12 It would appear, therefore, that x-----------------------------------------------------------------------------------x
with the release of petitioner, the matter had indeed become moot and academic. That disposes
of this petition, except for one final note. There was a lapse in judicial propriety by counsel DECISION
Salvador N. Beltran who did not even take the trouble of appearing in Court on the very day his
own petition was reset for hearing, a lapse explicable, it may be assumed, by his comparative GARCIA, J.:
inexperience and paucity of practice before this Tribunal. it suffices to call his attention to such
failing by way of guidance for his future actuations as a member of the bar.
Herein petitioners, the spouses Pedro Regalado and Zanita Regalado, have come to this
Court via this appeal[1] by certiorari under Rule 45 of the Rules of Court to nullify and set aside
WHEREFORE, the petition for habeas corpus is dismissed for being moot and academic. the following issuances of the Regional Trial Court (RTC) of Kalibo, Aklan, Branch 8, in its Spl.
Civil Action No. 4518, to wit:

1. Order dated July 26, 1995,[2] granting the petition for

appointment of a receiver embodied in the main complaint filed by
respondents, and directing such receiver to put up a bond;

2. Decision dated November 28, 1997,[3] declaring the parcel of

fishpond land subject of the case as the common property of all
the parties; ordering the partition of the same into nine (9) equal
parts; requiring petitioners to render an accounting of the produce
of said fishpond starting 1980 until actual partition is effected;
ordering petitioners to pay jointly and severally attorneys fees and
litigation expenses and other costs; and ordering the appointment
of a receiver agreeable to all parties upon the filing of the bond for
receivership;

3. Order dated January 14, 1998,[4] dismissing the appeal filed

by petitioners for failure to file their record on appeal and to pay
the appellate court docket and other lawful fees; and

4. Order dated May 19, 1998,[5] denying petitioners petition for

relief from judgment.

The facts:
Petitioner Pedro M. Regalado, married to co-petitioner Zanita F. Regalado, and
respondents Abraham, Cirilo, Isidro, Ciriaco, Jorge, Lucio, and Apolonio, all surnamed
Regalado, and Juliana R. Abello (hereinafter collectively referred to as respondents), are the
children of the deceased spouses Apolonio Regalado and Sofia Regalado.
It appears that as early as 1929, the parties parents had been in possession of a 40-
hectare fishpond which the parents developed and even leased to third persons for a time.At
one time, their father leased part of the fishpond property to one Benjamin Roxas for a period of
nine (9) years commencing January 6, 1972 to January 6, 1981. However, in 1980, before the
termination of the lease contract with Roxas, petitioner Pedro Regalado with one of the
respondents, Ciriaco Regalado, forcibly took possession of the fishpond from its lessee.
Upon the death of their father, respondents demanded from petitioner-spouses who
are in the possession of the entire fishpond, the partition thereof. Respondents alleged that
petitioners refused and merely requested for another three (3) years to be in possession of the
subject property.
Again, in 1989, respondents reiterated their demand for partition but petitioners again
refused and once more requested that they be allowed to remain in possession and usufruct of
the property for five (5) more years after all the litigations concerning the same shall have been
terminated, reasoning out that they have not yet recovered all their expenses in developing and
recovering possession of the fishpond from third persons.
In 1992, respondents again demanded for partition but as before, petitioners again
refused. Hence, on August 20, 1992, in the RTC of Kalibo, Aklan, respondents filed against
petitioners a complaint for Partition of Real Estate, Accounting, Damages and Appointment of a
Receiver,[6] thereat docketed as Spl. Civil Action No. 4518 which was raffled to Branch 8 of the
court.
In their Answer, petitioner-spouses, as defendants a quo, claimed that the fishpond in
question was not part of the hereditary estate of their parents as it is a public land covered by a
Fishpond Lease Agreement. They argued that even if it were to be considered as part of the
hereditary estate of the parents, respondents as plaintiffs below are not entitled to share equally
in the fishpond property as it was allegedly only petitioner Pedro Regalado who recovered the
actual physical possession of the same from third persons.Petitioners also claimed that
respondents did not keep their part in the agreement to let the spouses recover all the expenses
they incurred in the development and re-possession of the subject fishpond and to enjoy sole
usufruct thereof for five (5) years.
On May 31, 1993, respondents filed in Spl. Civil Case No. 4518,
a verified Petition forReceivership,[7] thereunder alleging that
there was a compelling need for the appointmentof a receiver
to safeguard the property and its produce from being wasted
or materiallyinjured on account of petitioners failure to pay the real estate taxes and fishpond
rentals due thereon. Respondents further averred that the property and the income
derivedtherefrom are in danger of being lost or misappropriated by
petitioners who were allegedlyconstructing their own house
thereat out of the income of the fishpond, throwing lavish parties frequently and getting heavily
indebted to several persons.
Petitioners opposed the petition for receivership, claiming that mere co-ownership
does not justify the appointment of a receiver, since it was actually petitioner Pedro Regalado
who risked his own life, spent his own money and time in recovering the fishpond without the
other parties contributing a single centavo. Petitioners also argued in their opposition that the
subject fishpond was public property which belongs to the Government, hence it would be folly
and a waste of money to pay the real property taxes thereon in addition to the fishpond rentals to
the Bureau of Fisheries and Aquatic Resources (BFAR).
In the herein first assailed Order dated July 26, 1995,[8] the trial court granted
respondents petition for receivership, explaining that respondents had rights and interests on the
subject property, which property is in danger of being foreclosed by petitioners creditors or
forfeited by the Government for non-payment of taxes.
Aggrieved by the aforementioned Order, petitioners filed a motion for reconsideration,
contending that said Order was premature as they (petitioners) were not yet finished with their
presentation of evidence in opposition to respondents petition for the appointment of a receiver.
Acting thereon, the trial court issued an Order[9] on August 14, 1995 holding in
abeyance the resolution of the receivership issue and setting the main case for trial on the
merits.
Eventually, in the herein assailed Decision[10] dated November 28, 1997, the trial
court rendered judgment for the respondents, as follows:
WHEREFORE, premises considered, judgment is hereby rendered:
a) Declaring the parcel of fishpond land located at Barangay
Camanci, Batan, Aklan described under paragraph 4 of the complaint and
herein referred to as the land in question, the common property of all the
parties herein;
b) Ordering the partition of the fishpond in question into nine (9)
equal parts, each part shall represent the share of Abraham M. Regalado,
Cirilo M. Regalado, Isidro M. Regalado, Ciriaco M. Regalado, Jorge M.
Regalado, Juliana R. Abello, Lucio M. Regalado, Apolonio M. Regalado, Jr.
and Pedro M. Regalado in the following manner: Within thirty (30) days from
receipt by the parties of this decision, they may make partition among
themselves, if they are able to agree, by proper instruments of conveyance
to be conformed by the court, otherwise, partition would be effected in
accordance with Sections 3 or 5, Rule 69 of the Revised Rules of Court, as
amended;
c) Ordering the defendants [now petitioners] to render an
accounting of the produce of the fishpond in question starting 1980 when
they first actually took possession of the same until actual partition of the
property is effected among the parties;
d) Ordering the defendants [now petitioners], to pay jointly and
severally, the plaintiffs [now respondents] the sum of P10,000.00 attorneys
fees, and litigation expenses and to pay the costs;
e) Ordering, upon filing of the petitioners [plaintiffs] bond for
receivership in the amount of ONE HUNDRED THOUSAND PESOS
(P100,000.00), the appointment of a receiver agreeable to all the parties,
who is likewise directed to put-up a bond before assuming his duties as
such in the amount which will be fixed later by this Court. [Words in brackets
supplied]
SO ORDERED.
Against said decision, petitioners filed a Notice of Appeal[11] on December 17, 1997, therein
making known their intention to take an appellate recourse to the Court of Appeals.
In the herein other assailed Order[12] dated January 14, 1998, the lower court denied due
course to petitioners notice of appeal, saying that while the notice was timely filed, yet petitioners
did not pay the appellate court docket and other lawful fees nor a record on appeal filed by them.
With the November 28, 1997 Decision having become final and executory,
respondents filed a Motion for Execution which was granted by the trial court. In time, an Entry
of Judgment[13] was made on February 27, 1998.
Then, on March 10, 1998, petitioners, this time thru one Atty. Pedro Icamina who was without
any proof of entry of appearance in the case either as new or collaborating counsel for the
petitioners, filed a Petition for Relief from Order,[14] thereto attaching an affidavit of Atty. Tirol,
petitioners counsel on record about whom there is no indication of any withdrawal of
appearance. In that affidavit, Atty. Tirol alleged that while his office received on January 19,
1998 a copy of the January 14, 1998 Order (denying due course topetitioners appeal), his law
clerk did not personally inform him about it and just placed said order on his table among the
piles of legal and court papers, adding that he (Atty. Tirol) had several court hearings, not to
mention the fact that he was a member of the Sangguniang Panlalawigan of Aklan which
required his attendance, all of which caused him to overlook the filing of the Record on
Appeal. In the same pleading, Atty. Icamina attached petitioners Record on Appeal and a check
for P400.00 as appellate court docket fee.
[15]
In the herein last assailed Order dated May 19, 1998, the trial court denied petitioners
petition for relief on the ground that the instances therein cited by counsel are not those
excusable negligence which warrant the granting of relief under Rule 38 of the Rules of Court.
Hence, this recourse by the petitioners.
We DENY.
At the outset, it must be stressed that in seeking the reversal and setting aside of the assailed
Orders and Decision of the trial court in its Spl. Civil Action No. 4518, petitioners came to us on a
petition for review under Rule 45 of the Rules of Court.
Under Section 1(b), Rule 41 of the Rules, the denial of a petition for relief from judgment or an
order disallowing or dismissing an appeal may only be challenged through the special civil action
of certiorari under Rule 65:
Section 1. Subject of appeal. An appeal may be taken from a
judgment or final order that completely disposes of the case, or of a
particular matter therein when declared by these Rules to be appealable.
No appeal may be taken from:
xxx xxx xxx
(b) An order denying a petition for relief or any similar motion
seeking relief from judgment;
xxx xxx xxx
(d) An order disallowing or dismissing an appeal;
xxx xxx xxx
In all the above instances where the judgment or final order
is not appealable, the aggrieved party may file an appropriate special
civil action under Rule 65. (Emphasis supplied)
Hence, in seeking the reversal of the trial courts Order dated May 19, 1998 which
denied their petition for relief from judgment, petitioners, in coming to us via the vehicle of appeal
by certiorari under Rule 45, have thus clearly availed of the wrong remedy.
In any event, even if petitioners came to us by certiorari under Rule 65, still the
recourse must fail. For, from a perusal of the petition itself, it is quite apparent that no allegation
of grave abuse of discretion on the part of the trial court was ever presented by them, and even
assuming there was, the same would still have to be dismissed.
A petition for relief from denial of an appeal is governed by Rule 38, Section 2 of the
Rules of Court which provides:
Section 2. Petition for relief from denial of appeal. When a judgment or final
order is rendered by any court in a case, and a party thereto, by fraud,
accident, mistake, or excusable negligence, has been prevented from taking
an appeal, he may file a petition in such court and in the same case praying
that the appeal be given due course.
In Tuason v. Court of Appeals,[16] we ruled:
A petition for relief from judgment is an equitable remedy; it is
allowed only in exceptional cases where there is no other available or
adequate remedy. When a party has another remedy available to him,
which may be either a motion for new trial or appeal from an adverse
decision of the trial court, and he was not prevented by fraud, accident,
mistake or excusable negligence from filing such motion or taking such
appeal, he cannot avail himself of this petition. Indeed, relief will not be
granted to a party who seeks avoidance from the effects of the judgment
when the loss of the remedy at law was due to his own negligence;
otherwise the petition for relief can be used to revive the right to appeal
which had been lost thru inexcusable negligence. (Citations omitted)
Here, there was no fraud, accident, mistake, or excusable negligence that prevented
petitioners from filing their Record on Appeal on time and paying the necessary appellate court
docket and filing fees therefor. In the precise words of the trial court:
The petition for relief stresses the reasons that the clerk of Atty.
Tirol, a certain Ms. Nina Temporaza, in charged (sic) of receiving and filing
of office papers failed to bring to the attention of Atty. Tirol the order of
denial dated January 14, 1998 and secondly, Atty. Tirol due to pressure of
work and court appearances and being an incumbent Sangguniang
Panlalawigan of Aklan, thinking all the time that his notice of appeal filed by
him was in order (sic).
On the first excuse, the Supreme Court in an analogous case had
the occasion to rule, viz;
The excuse offered by respondent Santos as reason for
his failure to perfect in due time his appeal from the judgment of
the Municipal Court, that counsels clerk forgot to hand him the
court notice, is the most hackneyed and habitual subterfuge
employed by litigants who fail to observe the procedural
requirements prescribed by the Rules of Court. x x x in the face of
 the Supreme Court repeated rulings (that) they are neither
credible nor constitutive of excusable negligence (Phil. Airlines
Inc. vs. Arca, et al., Vol. 19 SCRA 350).
As to the second excuse, the Supreme Court has this to say,
Volume and pressure of work is not an excusable
negligence. Moreover, the said petition was not based on a valid ground as
We have consistently ruled that volume and pressure of work does not
constitute mistake or excusable negligence as to warrant relief from
judgment which is available only in exceptional cases (Biscarra vs.
Republic, 95 SCRA 248).
Furthermore, the appellate court docket fee and other lawful fees
are now required to be paid within the period for taking an appeal to the
clerk of court which rendered the judgment or order appealed from. Failure
to pay said fees on time is also a ground for dismissal of the appeal (Sec. 1
(c) of Rule 50).
To stress, even in the matter of questioning the trial courts Order dated January14,
1998 denying due course to petitioners appeal, the glaring fact reveals that again, petitioners
availed of the wrong remedy.
It must be remembered that a party aggrieved by an order disallowing or dismissing
an appeal may file an appropriate special civil action under Rule 65. Sadly, however, petitioners
erroneously filed an appeal by certiorari under Rule 45.
Assuming, arguendo, that petitioners are allowed to take an appeal from said Order,
we find no excusable negligence to merit the grant of the petition for relief.
In this case, it is undisputed that petitioners merely filed a Notice of Appeal. The
Record on Appeal was belatedly filed, as in fact it was merely attached to their March 10,
1998 Petition for Relief from Order. What is more, no appellate docket and legal fees were paid
with the filing of the Notice of Appeal. Petitioners merely harp on their counsels alleged
excusable negligence resulting in their failure to seasonably file their Record on Appeal and pay
the required appellate docket and other legal fees.
Unfortunately for petitioners, negligence, to be excusable, must be one which ordinary
diligence and prudence could not have guarded against.[17] Again, petitioners failure to file a
Record on Appeal and pay the appellate docket fees cannot be considered as excusable
negligence due to counsels pressure of work and inadvertence of his office clerk.
On a final note, we emphasize that petitioners are bound by the acts of their counselin
the conduct of the instant case. They have to bear the consequences thereof. Petitioners
cannot thereafter be heard to complain that the result might
have been different had theircounsel proceeded differently. So it is that in Rivera v. Court of
[18]
Appeals, we ruled:
xxx It has been held time and again that blunders and mistakes
made in the conduct of theproceedings in the trial court as a result
of the ignorance, inexperience or incompetence of counsel do not qualify as
a ground for new trial. If such were to be admitted as
valid reasons for reopening cases,there would never be an end to litigation
so long as a new counsel could be employed to allege and show that the
prior counsel had not been sufficiently diligent, experienced or learned. This
will put a premium on the willful and intentional commission of errors by
counsel, with a view to securing new trials in the event of conviction.
There must, therefore, be an end to this litigation.
We take this occasion to require Atty. Pedro Icamina to explain within ten (10) days
from receipt hereof why he should not be proceeded administratively for filing the very petition in
this case and the Petition for Relief from Order in the lower court without first entering his
appearance as petitioners counsel.
WHEREFORE, the instant petition is DENIED for lack of merit.
Costs against petitioners.
SO ORDERED.
ANTERO J. POBRE, A.C. No. 7399
Complainant,
Present:
- versus - CHICO-NAZARIO, J.,
Acting Chairperson,
CARPIO MORALES,*
Sen. MIRIAM DEFENSOR- SANTIAGO, VELASCO, JR.,
Respondent. NACHURA, and
PERALTA, JJ.
Promulgated:
August 25, 2009
x-----------------------------------------------------------------------------------------x
DECISION
VELASCO, JR., J.:
In his sworn letter/complaint dated December 22, 2006, with enclosures, Antero J. Pobre invites
the Courts attention to the following excerpts of Senator Miriam Defensor-Santiagos speech
delivered on the Senate floor:
x x x I am not angry. I am irate. I am foaming in the mouth. I am homicidal. I
am suicidal. I am humiliated, debased, degraded. And I am not only that, I
feel like throwing up to be living my middle years in a country of this nature.
I am nauseated. I spit on the face of Chief Justice Artemio Panganiban and
his cohorts in the Supreme Court, I am no longer interested in the position
[of Chief Justice] if I was to be surrounded by idiots. I would rather be in
another environment but not in the Supreme Court of idiots x x x.
To Pobre, the foregoing statements reflected a total disrespect on the part of the speaker
towards then Chief Justice Artemio Panganiban and the other members of the Court and
constituted direct contempt of court. Accordingly, Pobre asks that disbarment proceedings or
other disciplinary actions be taken against the lady senator.
In her comment on the complaint dated April 25, 2007, Senator Santiago, through
counsel, does not deny making the aforequoted statements. She, however, explained that those
statements were covered by the constitutional provision on parliamentary immunity, being part of
a speech she delivered in the discharge of her duty as member of Congress or its committee.
The purpose of her speech, according to her, was to bring out in the open controversial
anomalies in governance with a view to future remedial legislation. She averred that she wanted
to expose what she believed to be an unjust act of the Judicial Bar Council [JBC], which, after
sending out public invitations for nomination to the soon to-be vacated position of Chief Justice,
would eventually inform applicants that only incumbent justices of the Supreme Court would
qualify for nomination. She felt that the JBC should have at least given an advanced advisory
that non-sitting members of the Court, like her, would not be considered for the position of Chief
Justice.
The immunity Senator Santiago claims is rooted primarily on the provision of Article
VI, Section 11 of the Constitution, which provides: A Senator or Member of the House of
Representative shall, in all offenses punishable by not more than six years imprisonment, be
privileged from arrest while the Congress is in session. No member shall be questioned nor
be held liable in any other place for any speech or debate in the Congress or in any
committee thereof. Explaining the import of the underscored portion of the provision, the Court,
in Osmea, Jr. v. Pendatun, said:
Our Constitution enshrines parliamentary immunity which is a
fundamental privilege cherished in every legislative assembly of the
democratic world. As old as the English Parliament, its purpose is to enable
and encourage a representative of the public to discharge his public trust
with firmness and success for it is indispensably necessary that he should
enjoy the fullest liberty of speech and that he should be protected from
resentment of every one, however, powerful, to whom the exercise of that
liberty may occasion offense.[1]
As American jurisprudence puts it, this legislative privilege is founded upon long
experience and arises as a means of perpetuating inviolate the functioning process of the
legislative department. Without parliamentary immunity, parliament, or its equivalent, would
degenerate into a polite and ineffective debating forum. Legislators are immune from deterrents
to the uninhibited discharge of their legislative duties, not for their private indulgence, but for the
public good. The privilege would be of little value if they could be subjected to the cost and
inconvenience and distractions of a trial upon a conclusion of the pleader, or to the hazard of a
judgment against them based upon a judges speculation as to the motives.[2]
This Court is aware of the need and has in fact been in the forefront in upholding the
institution of parliamentary immunity and promotion of free speech. Neither has the Court lost
sight of the importance of the legislative and oversight functions of the Congress that enable this
representative body to look diligently into every affair of government, investigate and denounce
anomalies, and talk about how the country and its citizens are being served. Courts do not
interfere with the legislature or its members in the manner they perform their functions in the
legislative floor or in committee rooms. Any claim of an unworthy purpose or of the falsity
and mala fides of the statement uttered by the member of the Congress does not destroy the
privilege.[3] The disciplinary authority of the assembly[4] and the voters, not the courts, can
properly discourage or correct such abuses committed in the name of parliamentary immunity.[5]
For the above reasons, the plea of Senator Santiago for the dismissal of the complaint
for disbarment or disciplinary action is well taken. Indeed, her privilege speech is not actionable
criminally or in a disciplinary proceeding under the Rules of Court. It is felt, however, that this
could not be the last word on the matter.
The Court wishes to express its deep concern about the language Senator Santiago, a
member of the Bar, used in her speech and its effect on the administration of justice. To the
Court, the lady senator has undoubtedly crossed the limits of decency and good professional
conduct. It is at once apparent that her statements in question were intemperate and highly
improper in substance. To reiterate, she was quoted as stating that she wanted to spit on the
face of Chief Justice Artemio Panganiban and his cohorts in the Supreme Court, and calling the
Court a Supreme Court of idiots.
The lady senator alluded to In Re: Vicente Sotto.[6] We draw her attention to the
ensuing passage in Sotto that she should have taken to heart in the first place:
x x x [I]f the people lose their confidence in the honesty and
integrity of this Court and believe that they cannot expect justice therefrom,
they might be driven to take the law into their own hands, and disorder and
perhaps chaos would be the result.
No lawyer who has taken an oath to maintain the respect due to the courts should be
allowed to erode the peoples faith in the judiciary. In this case, the lady senator clearly violated
Canon 8, Rule 8.01 and Canon 11 of the Code of Professional Responsibility, which respectively
provide:
Canon 8, Rule 8.01.A lawyer shall not, in his professional
dealings, use language which is abusive, offensive or otherwise improper.
Canon 11.A lawyer shall observe and maintain the respect due to
the courts and to the judicial officers and should insist on similar conduct by
others.
Senator/Atty. Santiago is a cut higher than most lawyers. Her achievements speak for
themselves. She was a former Regional Trial Court judge, a law professor, an oft-cited authority
on constitutional and international law, an author of numerous law textbooks, and an elected
senator of the land. Needless to stress, Senator Santiago, as a member of the Bar and officer of
the court, like any other, is duty-bound to uphold the dignity and authority of this Court and to
maintain the respect due its members. Lawyers in public service are keepers of public faith and
are burdened with the higher degree of social responsibility, perhaps higher than their brethren
in private practice.[7]Senator Santiago should have known, as any perceptive individual, the
impact her statements would make on the peoples faith in the integrity of the courts.
As Senator Santiago alleged, she delivered her privilege speech as a prelude to
crafting remedial legislation on the JBC. This allegation strikes the Court as an afterthought in
light of the insulting tenor of what she said. We quote the passage once more:
x x x I am not angry. I am irate. I am foaming in the mouth. I am
homicidal. I am suicidal. Iam humiliated, debased, degraded. And I am not
only that, I feel like throwing up to be living my middle years in a country of
this nature. I am nauseated. I spit on the face of Chief Justice Artemio
Panganiban and his cohorts in the Supreme Court, I am no longer
interested in the position [of Chief Justice] if I was to be surrounded by
idiots. I would rather be in another environment but not in the Supreme
Court of idiots x x x. (Emphasis ours.)
A careful re-reading of her utterances would readily show that her statements were
expressions of personal anger and frustration at not being considered for the post of Chief
Justice. In a sense, therefore, her remarks were outside the pale of her official parliamentary
functions. Even parliamentary immunity must not be allowed to be used as a vehicle to ridicule,
demean, and destroy the reputation of the Court and its magistrates, nor as armor for personal
wrath and disgust. Authorities are agreed that parliamentary immunity is not an individual
privilege accorded the individual members of the Parliament or Congress for their personal
benefit, but rather a privilege for the benefit of the people and the institution that represents
them.
 To be sure, Senator Santiago could have given vent to her anger without indulging in
insulting rhetoric and offensive personalities.
Lest it be overlooked, Senator Santiagos outburst was directly traceable to what she
considered as an unjust act the JBC had taken in connection with her application for the position
of Chief Justice. But while the JBC functions under the Courts supervision, its individual
members, save perhaps for the Chief Justice who sits as the JBCs ex-officio chairperson,[8] have
no official duty to nominate candidates for appointment to the position of Chief Justice. The
Court is, thus, at a loss to understand Senator Santiagos wholesale and indiscriminate assault
on the members of the Court and her choice of critical and defamatory words against all of them.
At any event, equally important as the speech and debate clause of Art. VI, Sec. 11 of
the Constitution is Sec. 5(5) of Art. VIII of the Constitution that provides:
Section 5. The Supreme Court shall have the following powers:
xxxx
(5) Promulgate rules concerning the protection and enforcement of
constitutional rights, pleading, practice, and procedure in all courts, the
admission to the practice of the law, the Integrated Bar, and legal
assistance to the underprivileged. (Emphasis ours.)
The Court, besides being authorized to promulgate rules concerning pleading,
practice, and procedure in all courts, exercises specific authority to promulgate rules governing
the Integrated Bar with the end in view that the integration of the Bar will, among other things:
(4) Shield the judiciary, which traditionally cannot defend itself
except within its own forum, from the assaults that politics and self interest
may level at it, and assist it to maintain its integrity, impartiality and
independence;
xxxx
(11) Enforce rigid ethical standards x x x.[9]
In Re: Letter Dated 21 February 2005 of Atty. Noel S. Sorreda,[10] we reiterated our
pronouncement in Rheem of the Philippines v. Ferrer[11] that the duty of attorneys to the courts
can only be maintained by rendering no service involving any disrespect to the judicial office
which they are bound to uphold. The Court wrote in Rheem of the Philippines:
x x x As explicit is the first canon of legal ethics which pronounces
that [i]t is the duty of a lawyer to maintain towards the Courts a respectful
attitude, not for the sake of the temporary incumbent of the judicial office,
but for the maintenance of its supreme importance. That same canon, as a
corollary, makes it peculiarly incumbent upon lawyers to support the courts
against unjust criticism and clamor. And more. The attorneys oath solemnly
binds him to a conduct that should be with all good fidelity x x x to the
courts.
Also, in Sorreda, the Court revisited its holding in Surigao Mineral Reservation Board
v. Cloribel[12] that:
A lawyer is an officer of the courts; he is, like the court itself, an
instrument or agency to advance the ends of justice. His duty is to uphold
the dignity and authority of the courts to which he owes fidelity, not to
promote distrust in the administration of justice. Faith in the courts, a lawyer
should seek to preserve. For, to undermine the judicial edifice is disastrous
to the continuity of government and to the attainment of the liberties of the
people. Thus has it been said of a lawyer that [a]s an officer of the court, it is
his sworn and moral duty to help build and not destroy unnecessarily that
high esteem and regard towards the courts so essential to the proper
administration of justice.[13]
The lady senator belongs to the legal profession bound by the exacting injunction of a
strict Code. Society has entrusted that profession with the administration of the law and
dispensation of justice. Generally speaking, a lawyer holding a government office may not be
disciplined as a member of the Bar for misconduct committed while in the discharge of official
duties, unless said misconduct also constitutes a violation of his/her oath as a lawyer.[14]
Lawyers may be disciplined even for any conduct committed in their private capacity,
as long as their misconduct reflects their want of probity or good demeanor,[15] a good character
being an essential qualification for the admission to the practice of law and for continuance of
such privilege.When the Code of Professional Responsibility or the Rules of Court speaks of
conduct or misconduct, the reference is not confined to ones behavior exhibited in connection
with the performance of lawyers professional duties, but also covers any misconduct, whichalbeit
unrelated to the actual practice of their professionwould show them to be unfit for the office and
unworthy of the privileges which their license and the law invest in them. [16]
This Court, in its unceasing quest to promote the peoples faith in courts and trust in
the rule of law, has consistently exercised its disciplinary authority on lawyers who, for
malevolent purpose or personal malice, attempt to obstruct the orderly administration of justice,
trifle with the integrity of courts, and embarrass or, worse, malign the men and women who
compose them. We have done it in the case of former Senator Vicente Sotto in Sotto, in the
case of Atty. Noel Sorreda in Sorreda, and in the case of Atty. Francisco B. Cruz in Tacordan v.
Ang[17] who repeatedly insulted and threatened the Court in a most insolent manner.
The Court is not hesitant to impose some form of disciplinary sanctions on
Senator/Atty. Santiago for what otherwise would have constituted an act of utter disrespect on
her part towards the Court and its members. The factual and legal circumstances of this case,
however, deter the Court from doing so, even without any sign of remorse from her. Basic
constitutional consideration dictates this kind of disposition.
We, however, would be remiss in our duty if we let the Senators offensive and
disrespectful language that definitely tended to denigrate the institution pass by. It is imperative
on our part to re-instill in Senator/Atty. Santiago her duty to respect courts of justice, especially
this Tribunal, and remind her anew that the parliamentary non-accountability thus granted to
members of Congress is not to protect them against prosecutions for their own benefit, but to
enable them, as the peoples representatives, to perform the functions of their office without fear
of being made responsible before the courts or other forums outside the congressional hall. [18] It
is intended to protect members of Congress against government pressure and intimidation
aimed at influencing the decision-making prerogatives of Congress and its members.
The Rules of the Senate itself contains a provision on Unparliamentary Acts and
Languagethat enjoins a Senator from using, under any circumstance, offensive or improper
language against another Senator or against any public institution.[19] But as to Senator
Santiagos unparliamentary remarks, the Senate President had not apparently called her to
order, let alone referred the matter to the Senate Ethics Committee for appropriate disciplinary
action, as the Rules dictates under such circumstance.[20] The lady senator clearly violated the
rules of her own chamber. It is unfortunate that her peers bent backwards and avoided imposing
their own rules on her.
 Finally, the lady senator questions Pobres motives in filing his complaint, stating that Raul S. Sison Law Offices for intervenor-petitioner Bel-Air Village Association, Inc. Renato L.
disciplinary proceedings must be undertaken solely for the public welfare. We cannot agree with Dela Fuente for respondent Ayala Corporation.
her more. We cannot overstress that the senators use of intemperate language to demean and
denigrate the highest court of the land is a clear violation of the duty of respect lawyers owe to
G.R. No. L-74376:
the courts.[21]

Finally, the Senator asserts that complainant Pobre has failed to prove that she in fact Raul S. Sison Law Offices for petitioner.
made the statements in question. Suffice it to say in this regard that, although she has not
categorically denied making such statements, she has unequivocally said making them as part
of her privilege speech. Her implied admission is good enough for the Court. Sergio L. Guadiz for private respondents.

WHEREFORE, the letter-complaint of Antero J. Pobre against Senator/Atty. Miriam G.R. No. L-76394:
Defensor-Santiago is, conformably to Art. VI, Sec. 11 of the Constitution, DISMISSED.

SO ORDERED. Raul S. Sison Law Offices for petitioner.

Gruba, Tanlimco Lamso and Apuhin Law Offices for respondents.

G.R. No. 71169 December 22, 1988

G.R. No. L-78182:

JOSE D. SANGALANG and LUTGARDA D. SANGALANG, petitioners, FELIX C. GASTON
and DOLORES R. GASTON, JOSE V. BRIONES and ALICIA R. BRIONES, and BEL-AIR
VILLAGE ASSOCIATION, INC., intervenors-petitioners, Funk & Associates for petitioners.
vs.
INTERMEDIATE APPELLATE COURT, and AYALA CORPORATION, respondents. Tee Tomas & Associates for respondents.

G.R. No. 74376 December 22, 1988 G.R. No. L-82281:

BEL-AIR VILLAGE ASSOCIATION, INC., petitioner, Funk & Associates for petitioner.
vs.
THE INTERMEDIATE APPELLATE COURT, ROSARIO DE JESUS TENORIO, and CECILIA
GONZALVEZ, respondents. Castillo, Laman, Tan & Associates for private respondents.

G.R. No. 76394 December 22,1988

SARMIENTO, J.:
BEL-AIR VILLAGE ASSOCIATION, INC., petitioner,
vs. Before the Court are five consolidated petitions, 1 docketed as G.R. Nos. 71169, 74376, 76394,
THE COURT OF APPEALS, and EDUARDO and BUENA ROMUALDEZ respondents. 78182, and 82281 hereof, in the nature of appeals (by certiorari under Rule 45 of the Rules of
Court) from five decisions of the Court of Appeals, denying specific performance and damages.
G.R. No. 78182 December 22, 1988
The proceedings were commenced at the first instance by Jose Sangalang, joined by his wife
Lutgarda Sangalang, both residents of No. 110 Jupiter Street, Makati, Metro Manila (G.R. No.
BEL-AIR VILLAGE ASSOCIATION, INC., petitioner, 71169) to enforce by specific performance restrictive easement upon property, specifically the
vs. Bel- Air Village subdivision in Makati, Metro Manila, pursuant to stipulations embodied in the
COURT OF APPEALS, DOLORES FILLEY, and J. ROMERO & ASSOCIATES, respondents. deeds of sale covering the subdivision, and for damages. Later, the Sangalangs were joined by
Felix Gaston, a resident of No. 64 Jupiter Street of the same municipality, and by Mr. and Mrs.
G.R. No. 82281 December 22, 1988 Jose and Alicia Briones, both of No. 66 Jupiter Street. Pending further proceedings, the Bel-Air
Village Association, Inc. (BAVA), an incorporated homeowners' association, entered its
appearance as plaintiff-in-intervention.
BEL-AIR VILLAGE ASSOCIATION, INC, petitioner,
vs.
COURT OF APPEALS, VIOLETA MONCAL, and MAJAL DEVELOPMENT BAVA itself had brought its own complaints, four in number, likewise for specific performance
CORPORATION, respondents. and damages to enforce the same 'deed restrictions.' (See G.R. Nos. 74376, 76394, 78182, and
82281.)
Sangco, Anastacio, Castaneda & Duran Law Office for petitioners & private intervenors-
petitioners. ANTECEDENTS FACTS
 I. G.R. No. 71169 a. This lot/s shall not be subdivided. However, three or more lots may be
consolidated and subdivided into a lesser number of lots provided that none
of the resulting lots be smaller in area than the smallest lot before the
The facts are stated in the decision appealed from. We quote:
consolidation and that the consolidation and subdivision plan be duly
approved by the governing body of the Bel-Air Association.
xxxxxxxxx
b. This lot/s shall only be used for residential purposes.
(1) Bel-Air Village is located north of Buendia Avenue extension (now Sen.
Gil J. Puyat Ave.) across a stretch of commercial block from Reposo Street
c. Only one single family house may be constructed on a single lot, although
in the west up to Zodiac Street in the east, When Bel-Air Village was
separate servants' quarters or garage may be built.
planned, this block between Reposo and Zodiac Streets adjoining Buendia
Avenue in front of the village was designated as a commercial block.
(Copuyoc TSN, p. 10, Feb. 12, 1982). d. Commercial or advertising signs shall not be placed, constructed, or
erected on this lot. Name plates and professional signs of homeowners are
permitted so long as they do not exceed 80 x 40 centimeters in size.
(2) Bel-Air Village was owned and developed into a residential subdivision in
the 1950s by Makati Development Corporation (hereinafter referred to as
MDC), which in 1968 was merged with appellant Ayala Corporation. e. No cattle, pigs, sheep, goats, ducks, geese, roosters or rabbits shall be
maintained in the lot, except that pets may be maintained but must be
controlled in accordance with the rulings of the Association. The term "pets'
(3) Appellees-spouses Sangalang reside at No. 11O Jupiter Street between
includes chickens not in commercial quantities.
Makati Avenue and Reposo Street; appellees-spouses Gaston reside at No.
64 Jupiter Street between Makati Avenue and Zodiac Street; appellees-
spouses Briones reside at No. 66 Jupiter Street also between Makati f. The property is subject to an easement of two (2) meters within the lot and
Avenue and Zodiac Street; while appellee Bel-Air Village Association, Inc. adjacent to the rear and sides thereof not fronting a street for the purpose of
(hereinafter referred to as BAVA) is the homeowners' association in Bel-Air drainage, sewage, water and other public facilities as may be necessary
Village which takes care of the sanitation, security, traffic regulations and and desirable; and the owner, lessee or his representative shall permit
general welfare of the village. access thereto by authorized representatives of the Bel-Air Association or
public utility entities for the purposes for which the easement is created.
(4) The lots which were acquired by appellees Sangalang and spouse
Gaston and spouse and Briones and spouse in 1960, 1957 and 1958, g. This lot shall not be used for any immoral or illegal trade or activity.
respectively, were all sold by MDC subject to certain conditions and
easements contained in Deed Restrictions which formed a part of each
h. The owner and/or lessee of this lot/s shall at all times keep the grass cut
deed of sale. The pertinent provisions in said Deed Restrictions, which are
and trimmed to reduce the fire hazard of the property.
common to all lot owners in Bel-Air Village, are as follows:

xxx xxx xxx

I-BEL-AIR ASSOCIATION

VI-TERM OF RESTRICTIONS
The owner of this lot/s or his successors in interest is required to be and is
automatically a member of the Bel-Air Association and must abide by such
rules and regulations laid down by the Association in the interest of the The foregoing restrictions shall remain in force for fifty years from January
sanitation, security and the general welfare of the community. 15, 1957, unless sooner cancelled in its entirety by two thirds vote of
members in good standing of the Bel-Air Association. However, the
Association may, from time to time, add new ones, amend or abolish
The association will also provide for and collect assessments, which will
particular restrictions or parts thereof by majority rule.
constitute as a lien on the property junior only to liens of the government for
taxes and to voluntary mortgages for sufficient consideration entered into in
good faith. VII--ENFORCEMENT OF RESTRICTIONS

II-USE OF LOTS
Subject to such amendments and additional restrictions, reservations,
servitudes, etc., as the Bel- Air Association may from time to time adopt and
prescribe, this lot is subject to the following restrictions:
The foregoing restrictions may be enjoined and/or enforced by court action
by the Bel-Air Association, or by the Makati Development Corporation or its
assigns, or by any registered owner of land within the boundaries of the Bel-
Air Subdivision (Sub-division plan PSD-49226 and Lot 7-B, Psd-47848) or
by any member in good standing of the Bel-Air association." (Exh. 1 -b; Exh.
22, Annex "B"). (Appellant's Brief, pp. 4- 6)
(5) When MDC sold the above-mentioned lots to appellees' predecessors-
in-interest, the whole stretch of the commercial block between Buendia
Avenue and Jupiter Street, from Reposo Street in the west to Zodiac Street
in the east, was still undeveloped. Access, therefore, to Bel-Air Village was
opened to all kinds of people and even animals. So in 1966, although it was
not part of the original plan, MDC constructed a fence or wall on the
commercial block along Jupiter Street. In 1970, the fence or wall was partly
destroyed by typhoon "Yoling." The destroyed portions were subsequently
rebuilt by the appellant. (Copuyoc TSN, pp. 31-34, Feb. 12, 1982). When
Jupiter Street was widened in 1972 by 3.5 meters, the fence or wall had to
be destroyed. Upon request of BAVA, the wall was rebuilt inside the
boundary of the commercial block. (Copuyoc TSN, pp. 4447, Feb. 12,1982).
(6) When the appellant finally decided to subdivide and sell the lots in the
commercial block between Buendia and Jupiter, BAVA wrote the appellant
on May 9, 1972, requesting for confirmation on the use of the commercial
lots. The appellant replied on May 16, 1972, informing BAVA of the
restrictions intended to be imposed in the sale and use of the lots. Among
these restrictions are: that the building shall have a set back of 19 meters;
and that with respect to vehicular traffic along Buendia Avenue, entrance
only will be allowed, and along Jupiter Street and side streets, both entrance
and exit will be allowed.
(7) On June 30, 1972, appellant informed BAVA that in a few months it shall
subdivide and sell the commercial lots bordering the north side of Buendia
Avenue Extension from Reposo Street up to Zodiac Street. Appellant also
informed BAVA that it had taken all precautions and will impose upon the
commercial lot owners deed restrictions which will harmonize and blend with
the development and welfare of Bel-Air Village. Appellant further applied for
special membership in BAVA of the commercial lot owners. A copy of the
deed restrictions for the commercial lots was also enclosed. The proposed
deed restrictions shall include the 19 meter set back of buildings from
Jupiter Street, the requirement for parking space within the lot of one (1)
parking slot for every seventy five (75) meters of office space in the building
and the limitation of vehicular traffic along Buendia to entrance only, but
allowing both vehicular entrance and vehicular exit through Jupiter Street
and any side street.
In its letter of July 10, 1972, BAVA acknowledged the above letter of
appellant and informed the latter that the application for special membership
of the commercial lot owners in BAVA would be submitted to BAVA's board
of governors for decision.
(8) On September 25, 1972, appellant notified BAVA that, after a careful
study, it was finally decided that the height limitation of buildings on the
commercial lots shall be increased from 12.5 meters to 15 meters. Appellant
further informed BAVA that Jupiter Street shall be widened by 3.5 meters to
improve traffic flow in said street. BAVA did not reply to said letter, but on
January 22, 1973, BAVA wrote a letter to the appellant informing the latter
that the Association had assessed the appellant, as special member of the
association, the amount of P40,795.00 (based on 81,590 square meters at
P.50 per square meter) representing the membership dues to the
commercial lot owners for the year 1973, and requested the appellant to
remit the amount which its board of governors had already included in its
current budget. In reply, appellant on January 31, 1973 informed BAVA that
due to the widening of Jupiter Street, the area of the lots which were
accepted by the Association as members was reduced to 76,726 square
meters. Thus, the corresponding dues at P.50 per square meter should be
reduced to P38,363.00. This amount, therefore, was remitted by the
appellant to BAVA. Since then, the latter has been collecting membership
dues from the owners of the commercial lots as special members of the
Association. As a matter of fact, the dues were increased several times. In
1980, the commercial lot owners were already being charged dues at the
rate of P3.00 per square meter. (Domingo, TSN, p. 36, March 19, 1980). At
this rate, the total membership dues of the commercial lot owners amount to
P230,178. 00 annually based on the total area of 76,726 square meters of
the commercial lots.
(9) Meantime, on April 4, 1975, the municipal council of Makati enacted its
ordinance No. 81, providing for the zonification of Makati (Exh. 18). Under
this Ordinance, Bel-Air Village was classified as a Class A Residential Zone,
with its boundary in the south extending to the center line of Jupiter Street
(Exh. 18-A).
Thus, Chapter III, Article 1, Section 3.03, par. F. of the Ordinance provides:
F. Bel-Air Village area, as bounded on the N by Polaris and Mercedes
streets and on the NE by Estrella Street; on the SE by Epifanio de los
Santos Avenue and on the SW by the center line of Jupiter Street. Then
bounded on the N by the abandoned MRR Pasig Line; on the E by Makati
Avenue; on the S by the center line of Jupiter Street and on the W by the
center line of Reposo Street." (Exh. 18-A)
Similarly, the Buendia Avenue Extension area was classified as
Administrative Office Zone with its boundary in the North-North East
Extending also up to the center line of Jupiter Street (Exh. 18b).
Thus, Chapter III, Article I, Section 3.05, par. C. of the Ordinance provides:
C. The Buendia Avenue Extension areas, as bounded on the N-NE by the
center line of Jupiter Street, on the SE by Epifanio de los Santos Avenue;
on the SW by Buendia Avenue and on the NW by the center line of Reposo
Street, then on the NE by Malugay Street; on the SE by Buendia Avenue
and on the W by Ayala Avenue Extension." (Exh. 18-B)
The Residential Zone and the Administrative Office Zone, therefore, have a
common boundary along the center line of Jupiter Street.
The above zoning under Ordinance No. 81 of Makati was later followed
under the Comprehensive Zoning Ordinance for the National Capital Region
adopted by the Metro Manila Commission as Ordinance 81 -01 on March
14, 1981 (Exh. 19). However, under this ordinance, Bel-Air Village is simply
bounded in the South-Southeast by Jupiter Street-not anymore up to the
center line of Jupiter Street (Exh. B). Likewise, the blockdeep strip along the
northwest side of Buendia Avenue Extension from Reposo to EDSA was
classified as a High Intensity Commercial Zone (Exh. 19-c).
Thus, the Zoning District Boundaries -Makati, in Annex B of the Ordinance provides:
R-I-Low Intensity Residential Amapola Street - from Estrella Street to Mercedes Street

xxxxxxxxx Amapola Street -junction of Palma Street gate going to J. Villena Street

4. Bel-Air 1, 3, 4 Mercedes Street -- from EDSA to Imelda Avenue and Amapola junction

Bounded on the North -- J.P. Rizal and Amapola St. Zodiac Street - from Mercedes Street to Buendia Avenue

South - Rockwell Jupiter Street -- from Zodiac Street to Reposo Street connecting
Metropolitan Avenue to Pasong Tamo and V. Cruz Extension intersection
Northwest - P. Burgos
Neptune Street - from Makati Avenue to Reposo Street Orbit Street - from F.
Zobel-Candelaria intersection to Jupiter Street
Southeast - Jupiter

Paseo de Roxas - from Mercedes Street to Buendia Avenue (Exh. 17,

Southwest - Epifanio de los Santos Ave. (EDSA)
Annex A, BAVA Petition)

5. Bel-Air 2
On February 10, 1977, BAVA wrote the Mayor of Makati, expressing the
concern of the residents about the opening of the streets to the general
Bounded on the Northwest - J.P. Rizal public, and requesting specifically the indefinite postponement of the plan to
open Jupiter Street to public vehicles. (Exh. 17, Annex B, BAVA Petition).
Southwest - Makati Avenue
However, BAVA voluntarily opened to the public Amapola, Mercedes,
Zodiac, Neptune and Paseo de Roxas streets. (Exh. 17-A, Answer of Makati
South --- Jupiter par. 3-7).

Southeast -- Pasig Line

Later, on June 17,1977, the Barangay Captain of Bel-Air Village was
advised by the Office of the Mayor that, in accordance with the agreement
East - South Avenue" (Exh. 19-b) entered into during the meeting on January 28, 1 977, the Municipal
Engineer and the Station Commander of the Makati Police were ordered to
open for public use Jupiter Street from Makati Avenue to Reposo Street.
xxxxxxxxx Accordingly, he was requested to advise the village residents of the
necessity of the opening of the street in the interest of public welfare. (Exh.
C-3-High Intensity Commercial Zone 17, Annex E, BAVA Petition).

2. A block deep strip along the northwest side of Buendia Ave. Ext. from
Reposo to EDSA." (Exh, 19-c)
Under the above zoning classifications, Jupiter Street, therefore, is a
common boundary of Bel-Air Village and the commercial zone.
(10) Meanwhile, in 1972, BAVA had installed gates at strategic locations
across Jupiter Street which were manned and operated by its own security
guards who were employed to maintain, supervise and enforce traffic
regulations in the roads and streets of the village. (Villavicencio, TSN, pp,
22-25, Oct. 30, 1980; BAVA Petition, par. 11, Exh. 17).
Then, on June 10, 1977, the Municipal Engineer of Makati in a letter
addressed to BAVA advised the latter to open for vehicular and pedestrian
traffic the entire portion of Jupiter Street from Makati Avenue to Reposo
Street (Exh. 17, BAVA Petition, par. 14).
Finally, on August 12, 1977, the municipal officials of Makati concerned
allegedly opened, destroyed and removed the gates constructed/located at
the corner of Reposo Street and Jupiter Street as well as the gates/fences
located/constructed at Jupiter Street and Makati Avenue forcibly, and then
opened the entire length of Jupiter Street to public traffic. (Exh. 17, BAVA
Petition, pars. 16 and 17).

Then, on January 17, 1977, the Office of the Mayor of Makati wrote BAVA
directing that, in the interest of public welfare and for the purpose of easing
traffic congestion, the following streets in Bel-Air Village should be opened
for public use:
(11) Before the gates were-removed, there was no parking problem or traffic
problem in Jupiter Street, because Jupiter Street was not allowed to be
used by the general public (Villavicencio, TSN, pp. 24-25, Oct. 30, 1980).
However, with the opening of Zodiac Street from Estrella Street to Jupiter
Street and also the opening to the public of the entire length of Jupiter
Street, there was a tremendous increase in the volume of traffic passing Jose V. Briones and Alicia R. Briones, and the homeowners' association
along Jupiter Street coming from EDSA to Estrella Street, then to Zodiac (BAVA) intervened in the case.
Street to Jupiter Street, and along the entire length of Jupiter Street to its
other end at Reposo Street. (Villavicencio, TSN, pp. 30-32, Oct. 30, 1980).
(15) After trial on the merits, the then Court of First Instance of Rizal, Pasig,
Metro Manila, rendered a decision in favor of the appellees the dispositive
In the meantime, the purchasers of the commercial lots between Jupiter portion of which is as follows:
Street and Buendia Avenue extension had started constructing their
respective buildings in 1974-1975. They demolished the portions of the
WHEREFORE, judgment is hereby accordingly rendered as follows:
fence or wall standing within the boundary of their lots. Many of the owners
constructed their own fences or walls in lieu of the wall and they employed
their own security guards. (TSN, p. 83, Feb. 20,1981; TSN, pp. 53-54; 72- ON PLAINTIFFS' COMPLAINT:
74, March 20,1981; TSN, pp. 54-55, July 23, 1981).
Defendant is ordered to pay to the plaintiffs-spouses Sangalang the
(12) Then, on January 27, 1978, appellant donated the entire Jupiter Street following damages:
from Metropolitan Avenue to Zodiac Street to BAVA (Exh. 7)- However,
even before 1978, the Makati Police and the security force of BAVA were
already the ones regulating the traffic along Jupiter Street after the gates 1. The sum of P500,000.00 as actual and consequential damages;
were opened in 1977. Sancianco TSN, pp. 26-30, Oct. 2,1981).
2. The sum of P2,000,000.00 as moral damages;
In October, 1979, the fence at the corner of Orbit and Neptune Streets was
opened and removed (BAVA Petition, par. 22, Exh. 17). The opening of the 3. The sum of P500,000.00 as exemplary damages;
whole stretch of Orbit Street from J.P. Rizal Avenue up to Imelda Avenue
and later to Jupiter Street was agreed to at the conference attended by the
President of BAVA in the office of the Station Commander of Makati, subject 4. The sum of P100,000.00 as attorney's fees; and
to certain conditions, to wit:
5. The costs of suit.
That, maintenance of Orbit St. up to Jupiter St. shall be shouldered by the
Municipality of Makati. ON INTERVENORS FELIX and DOLORES GASTON'S COMPLAINT:

That, street lights will be installed and maintenance of the same along Orbit Defendant is ordered to pay to the spouses Felix and Dolores Gaston, the
St. from J.P. Rizal Ave. up to Jupiter St. shall be undertaken by the following damages:
Municipality.
1 . The sum of P400,000.00 as consequential damages;
That for the security of the residents of San Miguel Village and Bel-Air
Village, as a result of the opening of Orbit Street, police outposts shall be
constructed by the Municipality of Makati to be headed by personnel of 2 The sum of P500,000.00 as moral damages;
Station No. 4, in close coordination with the Security Guards of San Miguel
Village and Bel-Air Village." (CF. Exh. 3 to Counter-Affidavit, of Station 3 The sum of P500,000.00 as exemplary damages:
Commander, Ruperto Acle p. 253, records)" (Order, Civil Case No. 34948,
Exh. 17-c).
4 The sum of P50,000.00 as attorney's fees; and

(13) Thus, with the opening of the entire length of Jupiter Street to public
traffic, the different residential lots located in the northern side of Jupiter 5 The costs of suit.
Street ceased to be used for purely residential purposes. They became, for
all purposes, commercial in character. ON INTERVENORS JOSE and ALICIA BRIONES' COMPLAINT:

(14) Subsequently, on October 29, 1979, the plaintiffs-appellees Jose D. Defendant is ordered to pay to the spouses Jose and Alicia Briones, the
Sangalang and Lutgarda D. Sangalang brought the present action for following damages:
damages against the defendant-appellant Ayala Corporation predicated on
both breach of contract and on tort or quasi-delict A supplemental complaint
was later filed by said appellees seeking to augment the reliefs prayed for in 1 . The sum of P400,000.00 as consequential damages;
the original complaint because of alleged supervening events which
occurred during the trial of the case. Claiming to be similarly situated as the 2 The sum of P500,000.00 as moral damages;
plaintiffs-appellees, the spouses Felix C. Gaston and Dolores R. Gaston,
 3 The sum of P500,000.00 as exemplary damages;
4 The sum of P50,000.00 as attorney's fees; and
5 The costs of suit.
ON INTERVENOR BAVA'S COMPLAINT:
Defendant is ordered to pay intervenor BAVA, the following damages:
1. The sum of P400,000.00 as consequential damages;
2. The sum of P500,000.00 as exemplary damages;
3. The sum of P50,000.00 as attorney's fees; and
4. The costs of suit.
The above damages awarded to the plaintiffs and intervenors shall bear
legal interest from the filing of the complaint.
Defendant is further ordered to restore/reconstruct the perimeter wall at its
original position in 1966 from Reposo Street in the west to Zodiac Street in
the east, at its own expense, within SIX (6) MONTHS from finality of
judgment.
SO ORDERED.
(Record on Appeal, pp. 400-401) 2
xxxxxxxxx
On appeal, the Court of Appeals 3 rendered a reversal, and disposed as
follows:
ACCORDINGLY, finding the decision appealed from as not supported by
the facts and the law on the matter, the same is hereby SET ASIDE and
another one entered dismissing the case for lack of a cause of action.
Without pronouncement as to costs.
SO ORDERED. 4
II. G.R. No. 74376
This petition was similarly brought by BAVA to enforce the aforesaid restrictions stipulated in the
deeds of sale executed by the Ayala Corporation. The petitioner originally brought the complaint
in the Regional Trial Court of Makati, 5 principally for specific performance, plaintiff [now,
petitioner] alleging that the defendant [now, private respondent] Tenorio allowed defendant
[Tenorio's co-private respondent] Gonzalves to occupy and convert the house at 50 Jupiter
Street, Bel-Air Village, Makati, Metro Manila, into a restaurant, without its knowledge and
consent, and in violation of the deed restrictions which provide that the lot and building thereon
must be used only for residential purposes upon which the prayed for main relief was for 'the
defendants to permanently refrain from using the premises as commercial and to comply with
the terms of the Deed Restrictions." 6 The trial court dismissed the complaint on a procedural
ground, i.e., pendency of an Identical action, Civil Case No. 32346, entitled "Bel-Air Village
Association, Inc. v. Jesus Tenorio." The Court of Appeals 7 affirmed, and held, in addition, that
Jupiter Street "is classified as High density commercial (C-3) zone as per Comprehensive
Zoning Ordinance No. 81-01 for National Capital Region," 8 following its own ruling in AC-G.R.
No. 66649, entitled "Bel-Air Village Association, Inc. vs. Hy-Land Realty & Development
Corporation, et al."
III. G.R. No. 76394
xxxxxxxxx
Defendants-spouses Eduardo V. Romualdez, Jr. and Buena Tioseco are the
owners of a house and lot located at 108 Jupiter St., Makati, Metro Manila
as evidenced by Transfer Certificate of Title No. 332394 of the Registry of
Deeds of Rizal. The fact is undisputed that at the time the defendants
acquired the subject house and lot, several restrictions were already
annotated on the reverse side of their title; however, for purposes of this
appeal we shall quote hereunder only the pertinent ones, to wit:
(b,) This lot/shall be used only for residential purposes.
xxxxxxxxx
IV. Term of Restriction
The foregoing restriction(s) shall remain in force for fifty years from January
15, 1957, unless sooner cancelled in its entirety by two-thirds vote of the
members in good standing of the Bel-Air Association. However, the
Association may from time to time, add new ones, amend or abolish
particular restrictions or parts thereof by majority rule.
During the early part of 1979, plaintiff noted that certain renovations and
constructions were being made by the defendants on the subject premises,
for which reason the defendants were advised to inform the plaintiff of the
kind of construction that was going on. Because the defendants failed to
comply with the request of the plaintiff, the latter's chief security officer
visited the subject premises on March 23, 1979 and found out that the
defendants were putting up a bake and coffee shop, which fact was
confirmed by defendant Mrs. Romualdez herself. Thereafter, the plaintiff
reminded defendants that they were violating the deed restriction. Despite
said reminder, the defendants proceeded with the construction of the bake
shop. Consequently, plaintiff sent defendants a letter dated April 30, 1979
warning them that if they will not desist from using the premises in question
for commercial purposes, they will be sued for violations of the deed
restrictions.
Despite the warning, the defendants proceeded with the construction of their
bake shop. 9
xxxxxxxxx
The trial court 10 adjudged in favor of BAVA. On appeal, the Court of Appeals 11 reversed, on the
strength of its holding in AC-G.R. No. 66649 earlier referred to.
BAVA then elevated the matter to the Court by a petition for review on certiorari. The
Court 12 initially denied the petition "for lack of merit, it appearing that the conclusions of the
respondent Court of Appeals that private respondents' bake and coffee shop lies within a
commercial zone and that said private respondents are released from their obligations to
maintain the lot known as 108 Jupiter Street for residential purposes by virtue of Ordinance No.
81 of the Municipality of Makati and Comprehensive Zoning Ordinance No. 81-01 of the
Metropolitan Manila Commission, are in accord with law and jurisprudence," 13 for which BAVA
sought a reconsideration. Pending resolution, the case was referred to the Second Division of
this Court, 14 and thereafter, to the Court En Banc en consulta. 15 Per our Resolution, dated April
29, 1988, we consolidated this case with G.R. Nos. 74376 and 82281. 16
IV. G.R. No. 78182.
xxxxxxxxx
The case stemmed from the leasing by defendant Dolores Filley of her
building and lot situated at No. 205 Reposo Street, Bel-Air Village Makati,
Metro Manila to her co-defendant, the advertising firm J. Romero and
Associates, in alleged violation of deed restrictions which stipulated that
Filley's lot could only be used for residential purposes. Plaintiff sought
judgment from the lower court ordering the defendants to "permanently
refrain" from using the premises in question "as commercial" and to comply
with the terms of the deed restrictions.
After the proper proceedings, the court granted the plaintiff the sought for
relief with the additional imposition of exemplary damages of P50,000.00
and attorney's fees of P10,000.00. The trial court gave emphasis to the
restrictive clauses contained in Filley's deed of sale from the plaintiff, which
made the conversion of the building into a commercial one a violation.
Defendants now seek review and reversal on three (3) assignments of errors, namely:
I.
THE TRIAL COURT ERRED IN NOT FINDING THAT THE REGULATIONS
PROMULGATED BY THE MUNICIPAL AUTHORITIES IN MAKATI AND
THE MINISTRY OF HUMAN SETTLEMENT'S CHANGING THE
CHARACTER OF THE AREAS IN QUESTION HAD RENDERED THE
RESTRICTIVE EASEMENT ON THE TITLE OF THE APPELLANTS
VACATED.
II.
THE COURT ERRED IN NOT RULING THAT BECAUSE THE
APPELLEE(S) HAD ALLOWED THE USE OF THE PROPERTY WITHIN
THE VILLAGE FOR NON- RESIDENTIAL PURPOSES, IT IS NOW
ESTOPPED FROM ENFORCING THE RESTRICTIVE PROHIBITIONS
SUBJECT MATTER OF THIS CASE.
III.
THE COURT ERRED IN NOT FINDING THAT THERE EXISTED A
BILATERAL CONTRACT BETWEEN THE PARTIES AND THAT SINCE
APPELLEE HAD NOT PERFORMED ITS OBLIGATIONS UNDER THIS
ARRANGEMENT THE APPELLANT IN TURN WAS UNDER NO
OBLIGATION TO ANNOTATE THE RESTRICTIVE PROHIBITIONS ON
THE BACK OF THE TITLE.
Appellants anchor their appeal on the proposition that the Bel-Air Village
area, contrary to plaintiff- appellee's pretension of being a strictly residential
zone, is in fact commercial and characterize the restrictions contained in
appellant Filley's deed of sale from the appellee as completely outmoded,
which have lost all relevance to the present-day realities in Makati, now the
premier business hub of the nation, where there is a proliferation of
numerous commercial enterprises established through the years, in fact
even within the heart of so-called "residential" villages. Thus, it may be said
that appellants base their position on the inexorable march of progress
which has rendered at naught the continued efficacy of the restrictions.
Appellant on the other hand, relies on a rigid interpretation of the contractual
stipulations agreed upon with appellant Filley, in effect arguing that the
restrictions are valid ad infinitum.
The lower court quite properly found that other commercial establishments
exist in the same area (in fact, on the same street) but ignored it just the
same and said-
The fact that defendants were able to prove the existence of several
commercial establishments inside the village does not exempt them from
liability for violating some of the restrictions evidently choosing to accord
primacy to contractual stipulation. 17
xxxxxxxxx
The Court of Appeals 18 overturned the lower court, 19 likewise based on AC-G.R. No. 66649.
The respondent Court observed also that J. Romero & Associates had been given authority to
open a commercial office by the Human Settlements Regulatory Commission.
V. G.R. No. 82281
The facts of this case have been based on stipulation. We quote:
COMES NOW, the Parties, assisted by their respective counsel and to this
Honorable Court, respectfully enter into the following stipulations of facts, to
wit:
1. The parties admit the personal circumstances of each other as well as
their capacities to sue and be sued.
 2. The parties admit that plaintiff BAVA for short) is the legally constituted
homeowners' association in Bel-Air Subdivision, Makati, Metro Manila.
3. The parties admit that defendant Violets Moncal is the registered owner
of a parcel of land with a residential house constructed thereon situated at
No. 104 Jupiter Street, Bel-Air Village, Makati, Metro Manila; that as such lot
owner, she is a member of the plaintiff association.
4. The parties admit that defendant Majal Development Corporation (Majal
for short) is the lessee of defendant Moncal's house and lot located at No.
104 Jupiter Street.
5. The parties admit that a deed restrictions is annotated on the title of
defendant Moncal, which provides, among others, that the lot in question
must be used only for residential purposes;' that at time Moncal purchased
her aforesaid lot in 1959 said deed restrictions was already annotated in the
said title.
6. The parties admit that when Moncal leased her subject property to Majal,
she did not secure the consent of BAVA to lease the said house and lot to
the present lessee.
7. The parties admit that along Jupiter Street and on the same side where
Moncal's property is located, there are restaurants, clinics placement or
employment agencies and other commercial or business establishments.
These establishments, however, were sued by BAVA in the proper court.
8. The parties admit that at the time Moncal purchased the subject property
from the Makati Development Corporation, there was a perimeter wall,
running along Jupiter Street, which wall was constructed by the subdivision
owner; that at that time the gates of the entrances to Jupiter Street were
closed to public traffic. In short, the entire length of Jupiter which was inside
the perimeter wall was not then open to public traffic
9. The parties admit that subsequent thereto, Ayala tore down the perimeter
wall to give way to the commercial building fronting Buendia Avenue (now
Gil J. Puyat Avenue).
10. The parties admit that on August 12, 1977, the Mayor of Makati forcibly
opened and removed the street gates constructed on Jupiter Street and
Reposo Street, thereby opening said streets to the public.
11. The parties admit plaintiffs letters of October 10, 23 and 31, 1984; as
well as defendants' letters-reply dated October 17 and 29, 1984. 20
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The trial court 21 dismissed the petitioner's complaint, a dismissal affirmed on
appeal, 22 According to the appellate court, the opening of Jupiter Street to human and vehicular
traffic, and the commercialization of the Municipality of Makati in general, were circumstances
that had made compliance by Moncal with the aforesaid "deed restrictions" "extremely difficult
and unreasonable," 23 a development that had excused compliance altogether under Article
1267 of the Civil Code.
VI. The cases before the Court; the Court's decision.
In brief, G.R. Nos. 74376, 76394, 78182, and 82281 are efforts to enforce the "deed restrictions"
in question against specific residents (private respondents in the petitions) of Jupiter Street and
with respect to G.R. No. 78182, Reposo Street. The private respondents are alleged to have
converted their residences into commercial establishments (a restaurant in G.R. No. 74376, a
bakery and coffee shop in G.R. No. 76394, an advertising firm in G.R. No. 78182; and a
construction company, apparently, in G.R. No. 82281) in violation of the said restrictions. 24
Their mother case, G. R. No. 71169 is, on the other hand, a petition to hold the vendor itself,
Ayala Corporation (formerly Makati Development Corporation), liable for tearing down the
perimeter wall along Jupiter Street that had therefore closed its commercial section from the
residences of Bel-Air Village and ushering in, as a consequence, the full "commercialization" of
Jupiter Street, in violation of the very restrictions it had authored.
As We indicated, the Court of Appeals dismissed all five appeals on the basis primarily of its
ruling in AC-G.R. No. 66649, "Bel-Air Village, Inc. v. Hy-Land Realty Development Corporation,
et al.," in which the appellate court explicitly rejected claims under the same 'deed restrictions"
as a result of Ordinance No. 81 enacted by the Government of the Municipality of Makati, as well
as Comprehensive Zoning Ordinance No. 8101 promulgated by the Metropolitan Manila
Commission, which two ordinances allegedly allowed the use of Jupiter Street both for
residential and commercial purposes. It was likewise held that these twin measures were valid
as a legitimate exercise of police power.
The Court of Appeals' reliance on Ordinance Nos. 81. and 8101 is now assailed in these
petitions, particularly the Sangalang, et al. petition.
Aside from this fundamental issue, the petitioners likewise raise procedural questions. G.R. No.
71169, the mother case, begins with one.
1. G.R. No. 71169
In this petition, the following questions are specifically put to the Court:
May the Honorable Intermediate Appellate Court reverse the decision of the
trial court on issues which were neither raised by AYALA in its Answers
either to the Complaint or Supplemental Complaint nor specifically assigned
as one of the alleged errors on appeal? 25
May the Honorable Intermediate Appellate Court arbitrarily ignore the
decisive findings of fact of the trial court, even if uncontradicted and/or
documented, and premised mainly on its own unsupported conclusions
totally reverse the trial court's decision? 26
May the Honorable Intermediate Appellate Court disregard the trial court's
documented findings that respondent Ayala for its own self-interest and
commercial purposes contrived in bad faith to do away with the Jupiter
Street perimeter wall it put up three times which wall was really intended to
separate the residential from the commercial areas and thereby insure the
 privacy and security of Bel Air Village pursuant to respondent Ayala's
express continuing representation and/or covenant to do so? 27
a.
The first question represents an attack on the appellate court's reliance on Ordinances Nos. 81
and 81-01, a matter not supposedly taken up at the trial or assigned as an error on appeal. As a
rule, the Court of Appeals (then the Intermediate Appellate Court) may determine only such
questions as have been properly raised to it, yet, this is not an inflexible rule of procedure. In
Hernandez v. Andal, 28 it was stated that "an unassigned error closely related to an error
properly assigned, or upon which the determination of the question raised by the error properly
assigned is dependent, will be considered by the appellate court notwithstanding the failure to
assign it as error." 29
In Baquiran v. Court of Appeals, 30 we referred to the " modern trend of procedure . . . according]
the courts broad discretionary power" 31 and in which we allowed consideration of matters
"having some bearing on the issue submitted which the parties failed to raise or the lower court
ignore[d]. 32 And in Vda. de Javellana v. Court of Appeals, 33 we permitted the consideration of a
'patent error' of the trial court by the Court of Appeals under Section 7, of Rule 51, of the Rules
of Court, 34 although such an error had not been raised in the brief. But what we note is the fact
that the Ayala Corporation did raise the zoning measures as affirmative defenses, first in its
answers 35 and second, in its brief, 36 and submitted at the trial as exhibits. 37 There is
accordingly no cause for complaint on the part of the petitioners for Ayala's violation of the
Rules. But while there was reason for the consideration, on appeal, of the said zoning
ordinances in question, this Court nevertheless finds as inaccurate the Court of Appeals' holding
that such measures, had "in effect, [made] Jupiter Street ... a street which could be used not only
for residential purposes," 38 and that "[It lost its character as a street for the exclusive benefit of
those residing in Bel-Air Village completely." 39
Among other things, there is a recognition under both Ordinances Nos. 81 and 8 1-01 that
Jupiter Street lies as the boundary between Bel-Air Village and Ayala Corporation's commercial
section. And since 1957, it had been considered as a boundary not as a part of either the
residential or commercial zones of Ayala Corporation's real estate development projects. Thus,
the Bel-Air Village Association's articles of incorporation state that Bel-Air Village is 'bounded on
the NE., from Amapola St., to de los Santos Ave., by Estrella St., on the SE from Extrella St., to
Pedestrian Lane by E. De los Santos Ave., on the SW., from Pedestrian Lane to Reposo St., by
Jupiter Street
. . . . 40 Hence, it cannot be said to have been "for the exclusive benefit" of Bel-Air Village
residents.
We come to the perimeter wall then standing on the commercial side of Jupiter Street the
destruction of which opened the street to the public. The petitioners contend that the opening of
the thoroughfare had opened, in turn, the floodgates to the commercialization of Bel-Air Village.
The wall, so they allege, was designed precisely to protect the peace and privacy of Bel-Air
Village residents from the din and uproar of mercantile pursuits, and that the Ayala Corporation
had committed itself to maintain it. It was the opinion of the Court of Appeals, as we said, that
Ayala's liability therefor, if one existed, had been overtaken by the passage of Ordinances Nos.
81 and 82-01, opening Jupiter Street to commerce.
It is our ruling, we reiterate, that Jupiter Street lies as a mere boundary, a fact acknowledged by
the authorities of Makati and the National Government and, as a scrutiny of the records
themselves reveals, by the petitioners themselves, as the articles of incorporation of Bel-Air
Village Association itself would confirm. As a consequence, Jupiter Street was intended for the
use by both -the commercial and residential blocks. It was not originally constructed, therefore,
for the exclusive use of either block, least of all the residents of Bel-Air Village, but, we repeat, in
favor of both, as distinguished from the general public.
When the wall was erected in 1966 and rebuilt twice, in 1970 and 1972, it was not for the
purpose of physically separating the two blocks. According to Ayala Corporation, it was put up to
enable the Bel-Air Village Association "better control of the security in the area, 41 and as the
Ayala Corporation's "show of goodwill " 42 a view we find acceptable in the premises. For it
cannot be denied that at that time, the commercial area was vacant, "open for [sic] animals and
people to have access to Bel-Air Village." 43 There was hence a necessity for a wall.
In any case, we find the petitioners' theory, that maintaining the wall was a matter of a
contractual obligation on the part of Ayala, to be pure conjecture. The records do not establish
the existence of such a purported commitment. For one, the subdivision plans submitted did not
mention anything about it. For another, there is nothing in the "deed restrictions" that would point
to any covenant regarding the construction of a wall. There is no representation or promise
whatsoever therein to that effect.
With the construction of the commercial buildings in 1974, the reason for which the wall was
built- to secure Bel-Air Village from interlopers had naturally ceased to exist. The buildings
themselves had provided formidable curtains of security for the residents. It should be noted that
the commercial lot buyers themselves were forced to demolish parts of the wall to gain access to
Jupiter Street, which they had after all equal right to use.
In fine, we cannot hold the Ayala Corporation liable for damages for a commitment it did not
make, much less for alleged resort to machinations in evading it. The records, on the contrary,
will show that the Bel-Air Village Association had been informed, at the very outset, about the
impending use of Jupiter Street by commercial lot buyers. We quote:
xxxxxxxxx
1. Exh. I of appellee, the memorandum of Mr. Carmelo Caluag, President of
BAVA, dated May 10, 1972, informing the BAVA Board of Governors and
Barrio Council members about the future use of Jupiter Street by the lot
owners fronting Buendia Avenue. The use of Jupiter Street by the owners of
the commercial lots would necessarily require the demolition of the wall
along the commercial block adjoining Jupiter Street.
2. Exh. J of appellee, the minutes of the joint meeting of BAVA Board of
Governors and the Bel-Air Barrio Council where the matter that "Buendia lot
owners will have equal rights to use Jupiter Street," and that Ayala's "plans
about the sale of lots and use of Jupiter Street" were precisely taken up.
This confirms that from the start BAVA was informed that the commercial lot
owners will use Jupiter Street and that necessarily the wall along Jupiter
Street would be demolished.
3. Exh. 10, the letter of Mr. Demetrio Copuyoc to the President of BAVA,
dated May 16, 1972, expressly stating that vehicular entrance and exit to
the commercial lots would be allowed along Jupiter and side streets.
4. Exhs. 27, 27-A, 27-B, the letter of Atty. Salvador J. Lorayes dated June
30, 1972, with enclosed copy of proposed restriction for the commercial lots
to BAVA. He proposed restriction again expressly stated that "Vehicular
entrances and exits are allowed thru Jupiter and any side streets."
 5. Exh. L of appellee, the minutes of the meeting of the members of BAVA,
dated August 26, 1972, where it is stated "Recently, Ayala Corporation
informed the Board that the lots fronting Buendia Avenue will soon be
offered for sale, and that future lot owners will be given equal rights to use
Jupiter Street as well as members of the Association."
6. Exh. 25, the letter of Atty. Lorayes dated September 25, 1972, informing
BAVA of the widening of Jupiter Street by 3.5 meters to improve traffic flow
in said street to benefit both the residents of Bel-Air and the future owners of
the commercial lots. 44
The petitioners cannot successfully rely on the alleged promise by Demetrio Copuyoc, Ayala's
manager, to build a "[f]ence along Jupiter with gate for entrance and/or exit 45 as evidence of
Ayala's alleged continuing obligation to maintain a wall between the residential and commercial
sections. It should be observed that the fence referred to included a "gate for entrance and or
exit" which would have defeated the purpose of a wall, in the sense the petitioners would put in
one, that is to say, an impenetrable barrier. But as Ayala would point out subsequently, the
proposed fence was not constructed because it had become unnecessary when the commercial
lot owners commenced constructions thereon.
Be that as it may, the Court cannot visualize any purported obligation by Ayala Corporation to
keep the wall on the strength of this supposed promise alone. If truly Ayala promised anything
assuming that Capuyoc was authorized to bind the corporation with a promise it would have
been with respect to the fence. It would not have established the pre-existing obligation alleged
with respect to the wall.
Obligations arise, among other things, from contract. 46 If Ayala, then, were bound by an
obligation, it would have been pursuant to a contract. A contract, however, is characterized by a
"meeting of minds between two persons . 47As a consensual relation, it must be shown to exist
as a fact, clearly and convincingly. But it cannot be inferred from a mishmash of circumstances
alone disclosing some kind of an "understanding," when especially, those disparate
circumstances are not themselves incompatible with contentions that no accord had existed or
had been reached. 48
The petitioners cannot simply assume that the wall was there for the purpose with which they
now give it, by the bare coincidence that it had divided the residential block from the commercial
section of Bel-Air. The burden of proof rests with them to show that it had indeed been built
precisely for that objective, a proof that must satisfy the requirements of our rules of evidence. It
cannot be made to stand on the strength of plain inferences.
b.
This likewise answers the petitioners' second query, whether or not the Court of Appeals had
"arbitrarily ignore(d) the decisive findings of the trial court."49 i.e., findings pointing to alleged acts
performed by the Ayala Corporation proving its commitment to maintain the wall abovesaid.
Specifically, the petitioners refer to, among other things: (1) Ayala's alleged announcement to
Bel- Air Village Association members that "[the perimeter wall along Jupiter Street will not be
demolished," 50 (2) Ayala's alleged commitment "during the pendency of the case in the trial
court" to restore the wall; (3) alleged assurances by Copuyoc that the wall will not be removed;
(4) alleged contrivances by the corporation to make the association admit as members the
commercial lot buyers which provided them equal access to Jupiter Street; and (5) Ayala's
donation to the association of Jupiter Street for "private use" of Bel-Air residents. 51
682 (1903), where it was held that "whether the plaintiffs services were solicited or whether they
were offered to the defendant for his assistance, inasmuch as these services were accepted and
made use of by the latter, we must consider that there was a tacit and mutual consent as to the
rendition of services." (At 686.) In that case, the defendant had enormously benefitted from the
services that entitled the plaintiff to compensation on the theory that no one may unjustly enrich
himself at the expense of another (Solutio indebiti) The facts of this case differ.
As we stated, the Ayala Corporation's alleged conduct prior to or during the proceedings below
are not necessarily at war with claims that no commitment had been in fact made.
With respect to Ayala's alleged announcement before the association, the Court does not agree
that Ayala had categorically assumed as an obligation to maintain the wall "perpetually," i.e.,
until the year 2007 (the expiration date under the "deed restrictions.") There is nothing in its
statement that would bare any commitment. In connection with the conference between the
parties "during the pendency" of the trial, it is to be noted that the Ayala Corporation denies
having warranted the restoration of the said wall therein. What, on the other hand, appears in the
records is the fact that Ayala did make that promise, but provided that the Mayor allowed it. It
turned out, however, that the Mayor balked at the Idea. 52 But assuming that Ayala did promise
to rebuild the wall (in that conference), it does not seem to us that it did consequently promise to
maintain it in perpetuity.
It is unfair to say, as the trial court did, that the Ayala had "contrived to make future commercial
lot owners special members of BAVA and thereby acquire equal right with the regular members
thereof to use Jupiter Street 53 since, as we stated, the commercial lot buyers have the right, in
any event, to make use of Jupiter Street, whether or not they are members of the association. It
is not their memberships that give them the right to use it. They share that right with Bel-Air
residents from the outset.
The objective of making the commercial lot owners special members of the Bel-Air Village
Association was not to accord them equal access to Jupiter Street and inferentially, to give them
the right to knock down the perimeter wall. It was, rather, to regulate the use of the street owing
precisely to the "planned" nature of Ayala's development project, and real estate development in
general, and this could best be done by placing the commercial lot owners under the
association's jurisdiction.
Moreover, Ayala's overtures with the association concerning the membership of commercial lot
buyers therein have been shown to be neither perfidious nor unethical nor devious
(paraphrasing the lower court). We quote anew:
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(7) On June 30, 1972, appellant informed BAVA that in a few months it shall
subdivide and sell the commercial lots bordering the north side of Buendia
Avenue Extension from Reposo Street up to Zodiac Street. Appellant also
informed BAVA that it had taken all precautions and will impose upon the
commercial lot owners deed restrictions which will harmonize and blend with
the development and welfare of Bel-Air Village. Appellant further applied for
special membership in BAVA of the commercial lot owners. A copy of the
deed restrictions for the commercial lots was also enclosed. The proposed
deed restrictions shall include the 19 meter set back of buildings from
Jupiter Street, the requirement for parking space within the lot of one (1)
parking slot for every seventy five (75) meters of office space in the building
and the limitation of vehicular traffic along Buendia to entrance only, but
allowing both vehicular entrance and vehicular exit through Jupiter Street
and any side street.
In its letter of July 10, 1972, BAVA acknowledged the above letter of appellant and informed the
latter that the application for special membership of the commercial lot owners in BAVA would
be submitted to BAVA's board of governors for decision.
(8) On September 25,1972, appellant notified BAVA that, after a careful
study, it was finally decided that the height limitation of buildings on the
commercial lots shall be increased from 12.5 meters to 15 meters. Appellant
further informed BAVA that Jupiter Street shall be widened by 3.5 meters to
improve traffic flow in said street. BAVA did not reply to said letter, but on
January 22, 1973, BAVA wrote a letter to the appellant informing the latter
that the Association had assessed the appellant, as special member of the
association, the amount of P40,795.00 (based on 81,590 square meters at
P.50 per square meter) representing the membership dues of the
commercial lot owners for the year 1973, and requested the appellant to
remit the amount which its board of governors had already included in its
current budget. In reply, appellant on January 31, 1973 informed BAVA that
due to the widening of Jupiter Street, the area of the lots which were
accepted by the Association as members was reduced to 76,726 square
meters. Thus, the corresponding due at P.50 per square meter should be
reduced to P38,363.00. This amount, therefore, was remitted by the
appellant to BAVA. Since then, the latter has been collecting membership
dues from the owners of the commercial lots as special members of the
Association. As a matter of fact, the dues were increased several times. In
1980, the commercial lot owners were already being charged dues at the
rate of P3.00 per square meter. (Domingo, TSN, p. 36, March 19, 1980). At
this rate, the total membership dues of the commercial lot owners amount to
P230,178.00 annually based on the total area of 76,726 square meters of
the commercial lots. 54
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The alleged undertaking, finally, by Ayala in the deed of donation (over Jupiter Street) to leave
Jupiter Street for the private use of Bel-Air residents is belied by the very provisions of the deed.
We quote:
xxxxxxxxx
IV. That the offer made by the DONOR had been accepted by the DONEE
subject to the condition that the property will be used as a street for the use
of the members of the DONEE, their families, personnel, guests, domestic
help and, under certain reasonable conditions and restrictions, by the
general public, and in the event that said lots or parts thereof cease to be
used as such, ownership thereof shall automatically revert to the DONOR.
The DONEE shall always have Reposo Street, Makati Avenue, and Paseo
de Roxas open for the use of the general public. It is also understood that
the DONOR shall continue the maintenance of the street at its expense for a
period of three years from date hereof." (Deed of Donation, p. 6, Exh. 7) 55
xxxxxxxxx
The donation, on the contrary, gave the general public equal right to it.
The Court cannot then say, accepting the veracity of the petitioners' facts" enumerated above,
that the Ayala Corporation may be held liable for specific performance of a demandable
obligation, let alone damages.
The Court adds that Ayala can hardly be held responsible for the alleged deterioration of "living
and environmental conditions" 56 of the Bel-Air area, as a consequence of "Ayala's authorized
demolition of the Jupiter perimeter wall in 1974-1975. " 57 We agree with Ayala that until 1976,
"there was peace and quiet" at Jupiter Street, as the petitioners' (Sangalang, Gaston, and
Briones) complaints admit. Hence, the degeneration of peace and order in Bel-Air cannot be
ascribed to the destruction of the wall in 1974 and 1975.
What Ayala submits as the real cause was the opening of Jupiter Street to vehicular traffic in
1977., 58 But this was upon orders of the Mayor, and for which the homeowners' association had
precisely filed suit (Civil Case No. 34998) 59 to contest the act of the Mayor.
c.
This likewise disposes of the third question presented. The petitioners' reliance on Ayala's
alleged conduct (proving its alleged commitment), so we have ruled, is not well-taken. Ayala's
alleged acts do not, by themselves, reflect a commitment to maintain the wall in dispute. It
cannot be therefore said that the Court of Appeals "arbitrarily ignore(d]" 60 the lower court's
findings. Precisely, it is the duty of the appellate court to review the findings of the trial judge, be
they of fact or law. 61 It is not bound by the conclusions of the judge, for which reason it makes
its own findings and arrives at its own conclusions. Unless a grave abuse of discretion may be
imputed to it, it may accept or reject the lower tribunal's determinations and rely solely on the
records.
Accordingly, the Court affirms the Court of Appeals' holding that the Ayala Corporation, in its
dealings with the petitioners, the Bel-Air Village Association in particular, had "acted with justice,
gave the appellees [petitioners] their due and observed honesty and good faith." 62 "Therefore,
under both Articles 19 and 21 of the Civil Code, the appellant [Ayala] cannot be held liable for
damages." 63
2. G.R. Nos. 74376, 76394, 78182, & 82281
Our decision also resolves, quite anticlimactically, these companion cases. But we do so for
various other reasons. In the Sangalang case, we absolve the Ayala Corporation primarily owing
to our finding that it is not liable for the opening of Jupiter Street to the general public. Insofar as
these petitions are concerned, we likewise exculpate the private respondents, not only because
of the fact that Jupiter Street is not covered by the restrictive easements based on the "deed
restrictions" but chiefly because the National Government itself, through the Metro Manila
Commission (MMC), had reclassified Jupiter Street into high density commercial (C-3)
zone, 64 pursuant to its Ordinance No. 81-01. Hence, the petitioners have no cause of action on
the strength alone of the said "deed restrictions.
In view thereof, we find no need in resolving the questions raised as to procedure, since this
disposition is sufficient to resolve these cases.
It is not that we are saying that restrictive easements, especially the easements herein in
question, are invalid or ineffective. As far as the Bel-Air subdivision itself is concerned, certainly,
they are valid and enforceable. But they are, like all contracts, subject to the overriding
demands, needs, and interests of the greater number as the State may determine in the
legitimate exercise of police power. Our jurisdiction guarantees sanctity of contract and is said to
be the "law between the contracting parties, 65 but while it is so, it cannot contravene 'law,
morals, good customs, public order, or public policy. 66 Above all, it cannot be raised as a arbitrary or unreasonable to warrant the reversal of the judgments so appealed. In that
deterrent to police power, designed precisely to promote health, safety, peace, and enhance the connection, we find no reversible error to have been committed by the Court of Appeals.
common good, at the expense of contractual rights, whenever necessary. In Ortigas & Co.,
Limited Partnership v. Feati Bank and Trust Co., 67 we are told:
WHEREFORE, premises considered, these petitions are DENIED No pronouncement as to
costs.
xxxxxxxxx
IT IS SO ORDERED.
2. With regard to the contention that said resolution cannot nullify the JUDGE RENE B. BACULI, A.C. No. 8920
contractual obligations assumed by the defendant-appellee referring to the Complainant,
restrictions incorporated in the deeds of sale and later in the corresponding Present:
Transfer Certificates of Title issued to defendant-appellee it should be
stressed, that while non-impairment of contracts is constitutionally BRION, J.,*
guaranteed, the rule is not absolute, since it has to be reconciled with the Acting Chairperson,
legitimate exercise of police power, i.e., "the power to prescribe regulations - versus - DEL CASTILLO,**
to promote the health, morals, peace, education, good order or safety and PEREZ,
general welfare of the people.' Invariably described as "the most essential, MENDOZA,*** and
insistent, and illimitable of powers" and "in a sense, the greatest and most SERENO, JJ.
powerful attribute of government," the exercise of the power may be
judicially inquired into and corrected only if it is capricious, whimsical, unjust Promulgated:
or unreasonable, there having been a denial of due process or a violation of ATTY. MELCHOR A. BATTUNG,
any other applicable constitutional guarantee. As this Court held through Respondent. September 28, 2011
Justice Jose P. Bengson in Philippine Long Distance Company vs. City of
Davao, et al. police power 'is elastic and must be responsive to various x------------------------------------------------------------------------------------x
social conditions; it is not confined within narrow circumscriptions of
precedents resting on past conditions; it must follow the legal progress of a
democratic way of life.' We were even more emphatic in Vda. de Genuino DECISION
vs. The Court of agrarian Relations, et al., when We declared: "We do not
see why public welfare when clashing with the individual right to property BRION, J.:
should not be made to prevail through the state's exercise of its police
power."

Resolution No. 27, 1960 declaring the western part of High way 54, now E.
de los Santos Avenue (EDSA, for short) from Shaw Boulevard to the Pasig
River as an industrial and commercial zone, was obviously passed by the
Municipal Council of Mandaluyong, Rizal in the exercise of police power to
safeguard or promote the health, safety, peace, good order and general
welfare of the people in the locality. Judicial notice may be taken of the
conditions prevailing in the area, especially where Lots Nos. 5 and 6 are
located. The lots themselves not only front the highway; industrial and
commercial complexes have flourished about the place. EDSA, a main
traffic artery which runs through several cities and municipalities in the
Metro Manila area, supports an endless stream of traffic and the resulting
activity, noise and pollution are hardly conducive to the health, safety or
welfare of the residents in its route. Having been expressly granted the
power to adopt zoning and subdivision ordinances or regulations, the
municipality of Mandaluyong, through its Municipal Council, was reasonably,
if not perfectly, justified under the circumstances, in passing the subject
resolution. 68
xxxxxxxxx
Undoubtedly, the MMC Ordinance represents a legitimate exercise of police power. The
petitioners have not shown why we should hold otherwise other than for the supposed "non-
impairment" guaranty of the Constitution, which, as we have declared, is secondary to the more
compelling interests of general welfare. The Ordinance has not been shown to be capricious or
Before us is the resolution[1] of the Board of Governors of the Integrated Bar of the
Philippines (IBP) finding Atty. Melchor Battung liable for violating Rule 11.03, Canon 11 of the
Code of Professional Responsibility and recommending that he be reprimanded. The
complainant is Judge Rene B. Baculi, Presiding Judge of the Municipal Trial Court in Cities,
Branch 2, TuguegaraoCity. The respondent, Atty. Battung, is a member of the Bar with postal
address on Aguinaldo St., Tuguegarao City.
Background
Judge Baculi filed a complaint for disbarment [2] with the Commission on Discipline of
the IBP against the respondent, alleging that the latter violated Canons 11[3] and 12[4] of the
Code of Professional Responsibility.
Violation of Canon 11 of the Code of Professional Responsibility
Judge Baculi claimed that on July 24, 2008, during the hearing on the motion for
reconsideration of Civil Case No. 2502, the respondent was shouting while arguing his
motion. Judge Baculi advised him to tone down his voice but instead, the respondent
shouted at the top of his voice. When warned that he would be cited for direct contempt, the
respondent shouted, Then cite me! [5] Judge Baculi cited him for direct contempt and
imposed a fine of P100.00. The respondent then left.
While other cases were being heard, the respondent re-entered the courtroom
and shouted, Judge, I will file gross ignorance against you! I am not afraid of you! [6] Judge
Baculi ordered the sheriff to escort the respondent out of the courtroom and cited him for
direct contempt of court for the second time.
After his hearings, Judge Baculi went out and saw the respondent at the hall of
the courthouse, apparently waiting for him. The respondent again shouted in a threatening
tone, Judge, I will file gross ignorance against you! I am not afraid of you! He kept on
shouting, I am not afraid of you! and challenged the judge to a fight. Staff and lawyers
escorted him out of the building.[7]
Judge Baculi also learned that after the respondent left the courtroom, he
continued shouting and punched a table at the Office of the Clerk of Court.[8]
Violation of Canon 12 of the Code of Professional Responsibility
According to Judge Baculi, the respondent filed dilatory pleadings in Civil Case
No. 2640, an ejectment case.
Judge Baculi rendered on October 4, 2007 a decision in Civil Case No. 2640,
which he modified on December 14, 2007. After the modified decision became final and
executory, the branch clerk of court issued a certificate of finality. The respondent filed a
motion to quash the previously issued writ of execution, raising as a ground the motion to
dismiss filed by the defendant for lack of jurisdiction. Judge Baculi asserted that the
respondent knew as a lawyer that ejectment cases are within the jurisdiction of First Level
Courts and the latter was merely delaying the speedy and efficient administration of justice.
The respondent filed his Answer,[9] essentially saying that it was Judge Baculi
who disrespected him.[10] We quote from his Answer:
23. I only told Judge Rene Baculi I will file Gross ignorance of the Law
against him once inside the court room when he was lambasting
me[.]
24. It was JUDGE BACULI WHO DISRESPECTED ME. He did not like that
I just submit the Motion for Reconsideration without oral argument
because he wanted to have an occasion to just HUMILIATE ME
and to make appear to the public that I am A NEGLIGENT
LAWYER, when he said YOU JUSTIFY YOUR NEGLIGENCE
BEFORE THIS COURT making it an impression to the litigants
and the public that as if I am a NEGLIGENT, INCOMPETENT,
MUMBLING, and IRRESPONSIBLE LAWYER.
25. These words of Judge Rene Baculi made me react[.]
xxxx
28. Since I manifested that I was not going to orally argue the Motion, Judge
Rene Baculi could have just made an order that the Motion for
Reconsideration is submitted for resolution, but what he did was
that he forced me to argue so that he will have the room to
humiliate me as he used to do not only to me but almost of the
lawyers here (sic).
Atty. Battung asked that the case against him be dismissed.
The IBP conducted its investigation of the matter through Commissioner Jose de la
Rama, Jr. In his Commissioners Report,[11] Commissioner De la Rama stated that during the
mandatory conference on January 16, 2009, both parties merely reiterated what they alleged in
their submitted pleadings. Both parties agreed that the original copy of the July 24, 2008 tape of
the incident at the courtroom would be submitted for the Commissioners review. Judge Baculi
submitted the tape and the transcript of stenographic notes on January 23, 2009.
Commissioner De la Rama narrated his findings, as follows:[12]
At the first part of the hearing as reflected in the TSN, it was
observed that the respondent was calm. He politely argued his case but the
voice of the complainant appears to be in high pitch. During the mandatory
conference, it was also observed that indeed, the complainant maintains a
high pitch whenever he speaks. In fact, in the TSN, where there was already
an argument, the complainant stated the following:
Court: Do not shout.
Atty. Battung: Because the court is shouting.
Court: This court has been constantly under this kind of
voice Atty. Battung, we are very sorry if you do not want
to appear before my court, then you better attend to
your cases and do not appear before my court if you do
not want to be corrected! (TSN, July 24, 2008, page 3)
(NOTE: The underlined words we are very sorry [ were]
actually uttered by Atty. Battung while the judge was
saying the quoted portion of the TSN)
That it was during the time when the complainant asked the
following questions when the undersigned noticed that Atty. Battung
shouted at the presiding judge.
Court: Did you proceed under the Revised Rules on
Summary Procedure?
*
Atty. Battung: It is not our fault Your Honor to proceed
because we were asked to present our evidence ex
parte. Your Honor, so, if should we were ordered (sic)
by the court to follow the rules on summary
procedure. (TSN page 3, July 24, 2008)
It was observed that the judge uttered the following:
Court: Do not shout.
Atty. Battung: Because the court is shouting.
(Page 3, TSN July 24, 2008)
Note: * it was at this point when the respondent shouted
at the complainant.
Thereafter, it was observed that both were already shouting at
each other.
Respondent claims that he was provoked by the presiding judge
that is why he shouted back at him. But after hearing the tape, the
undersigned in convinced that it was Atty. Battung who shouted first at the
complainant.
 Presumably, there were other lawyers and litigants present
waiting for their cases to be called.They must have observed the incident. In
fact, in the joint-affidavit submitted by Elenita Pacquing et al., they stood as
one in saying that it was really Atty. Battung who shouted at the judge that is
why the latter cautioned him not to shout.
The last part of the incident as contained in page 4 of the TSN
reads as follows:
Court: You are now ordered to pay a fine of P100.00.
Atty. Battung: We will file the necessary action against this court
for gross ignorance of the law.
Court: Yes, proceed.
(NOTE: Atty. Battung went out the courtroom)
Court: Next case.
Interpreter: Civil Case No. 2746.
(Note: Atty. Battung entered again the courtroom)
Atty. Battung: But what we do not like (not finished)
Court: The next time
Atty. Battung: We would like to clear
Court: Sheriff, throw out the counsel, put that everything in
record. If you want to see me, see me after the court.
Next case.
Civil Case No. 2746 for Partition and Damages, Roberto Cabalza
vs. Teresita Narag, et al.
(nothing follows)
Commissioner De la Rama found that the respondent failed to observe Canon 11 of
the Code of Professional Responsibility that requires a lawyer to observe and maintain respect
due the courts and judicial officers. The respondent also violated Rule 11.03 of Canon 11 that
provides that a lawyer shall abstain from scandalous, offensive or menacing language or
behavior before the courts. The respondents argument that Judge Baculi provoked him to shout
should not be given due consideration since the respondent should not have shouted at the
presiding judge; by doing so, he created the impression that disrespect of a judge could be
tolerated. What the respondent should have done was to file an action before the Office of the
Court Administrator if he believed that Judge Baculi did not act according to the norms of judicial
conduct.
With respect to the charge of violation of Canon 12 of the Code of Professional
Responsibility, Commissioner De la Rama found that the evidence submitted is insufficient to
support a ruling that the respondent had misused the judicial processes to frustrate the ends of
justice.
Commissioner De la Rama recommended that the respondent be suspended from the
practice of law for six (6) months.
On October 9, 2010, the IBP Board of Governors passed a Resolution adopting and
approving the Report and Recommendation of the Investigating Commissioner, with the
modification that the respondent be reprimanded.
The Courts Ruling
We agree with the IBPs finding that the respondent violated Rule 11.03, Canon 11 of
the Code of Professional Responsibility. Atty. Battung disrespected Judge Baculi by shouting at
him inside the courtroom during court proceedings in the presence of litigants and their
counsels, and court personnel. The respondent even came back to harass Judge Baculi. This
behavior, in front of many witnesses, cannot be allowed. We note that the respondent continued
to threaten Judge Baculi and acted in a manner that clearly showed disrespect for his
position even after the latter had cited him for contempt. In fact, after initially leaving the court,
the respondent returned to the courtroom and disrupted the ongoing proceedings. These actions
were not only against the person, the position and the stature of Judge Baculi, but against the
court as well whose proceedings were openly and flagrantly disrupted, and brought to disrepute
by the respondent.
Litigants and counsels, particularly the latter because of their position and avowed
duty to the courts, cannot be allowed to publicly ridicule, demean and disrespect a judge, and
the court that he represents. The Code of Professional Responsibility provides:
Canon 11 - A lawyer shall observe and maintain the respect due
the courts and to judicial officers and should insist on similar conduct by
others.
Rule 11.03 - A lawyer shall abstain from scandalous, offensive or
menacing language or behavior before the Courts.
We ruled in Roxas v. De Zuzuarregui, Jr.[13] that it is the duty of a lawyer, as an officer
of the court, to uphold the dignity and authority of the courts. Respect for the courts guarantees
the stability of the judicial institution; without this guarantee, the institution would be resting on
very shaky foundations.
A lawyer who insults a judge inside a courtroom completely disregards the latters role,
stature and position in our justice system. When the respondent publicly berated and brazenly
threatened Judge Baculi that he would file a case for gross ignorance of the law against the
latter, the respondent effectively acted in a manner tending to erode the public confidence in
Judge Baculis competence and in his ability to decide cases. Incompetence is a matter that,
even if true, must be handled with sensitivity in the manner provided under the Rules of Court;
an objecting or complaining lawyer cannot act in a manner that puts the courts in a bad light and
bring the justice system into disrepute.
The IBP Board of Governors recommended that Atty. Battung be reprimanded, while
the Investigating Commissioner recommended a penalty of six (6) months suspension.
We believe that these recommended penalties are too light for the offense.
In Re: Suspension of Atty. Rogelio Z. Bagabuyo, Former Senior State
Prosecutor,[14] we suspended Atty. Bagabuyo for one year for violating Rule 11.05, Canon 11,
and Rule 13.02, Canon 13 of the Code of Professional Responsibility, and for violating the
Lawyers Oath for airing his grievances against a judge in newspapers and radio programs. In
this case, Atty. Battungs violations are no less serious as they were committed in the courtroom
in the course of judicial proceedings where the respondent was acting as an officer of the court,
and before the litigating public. His actions were plainly disrespectful to Judge Baculi and to the
court, to the point of being scandalous and offensive to the integrity of the judicial system itself.
 WHEREFORE, in view of the foregoing, Atty. Melchor A. Battung is found GUILTY of
violating Rule 11.03, Canon 11 of the Code of Professional Responsibility, for which he
is SUSPENDED from the practice of law for one (1) year effective upon the finality of this
Decision. He is STERNLY WARNED that a repetition of a similar offense shall be dealt with
more severely.
Let copies of this Decision be furnished the Office of the Bar Confidant, to be
appended to the respondents personal record as an attorney; the Integrated Bar of
the Philippines; the Department of Justice; and all courts in the country, for their information and
guidance.
SO ORDERED.
A.M. Nos. RTJ-89-331, 355, 361, 362, 438, 439 September 28, 1990
PRUDENCIO S. PENTICOSTES, complainant,
vs.
JUDGE RAFAEL HIDALGO, respondent.
RESOLUTION
PER CURIAM:
Complainant Prudencio S. Penticostes has filed a series of administrative charges against Judge
Rafael B. Hidalgo of Regional Trial Court Branch 68 of Tarlac, Tarlac. In the resolution dated
June 20, 1989 dismissing RTJ-89-294, the Court admonished the complainant "to exercise more
care and decorum in filing unfounded and unsubstantiated charges against officers of the court
in order to maintain and uphold the dignity of the same of which he is a part" (also dismissed
was RTJ-88213 in a Resolution dated July 18, 1989.) Complainant did not heed this admonition.
In his Comment in RTJ-89-361, and his Compliance by way of comment in RTJ-89-355, the
respondent judge asked that the other administrative cases by the same complainant be
consolidated. Complainant, in his Reply in RTJ-89-355, made a similar request.
The Court directed the Office of the Court Administrator (OCA) to gather all charges filed by the
complainant against the respondent judge and thereafter consolidated six (6) administrative
complaints: RTJ-89-331 (which recites ten [10] causes of action), RTJ-89-355, RTJ-89-361,
RTJ-89-362, RTJ-89-439, and RTJ-89-438.
Subsequent to the June 20, 1989 admonition, complainant continued to file charges against
respondent. He also threatened to bang more cases, as evidenced by the following: (1) a
Manifestation dated March 1, 1990 (submitted to respondent judge in relation to two civil cases),
which reads:
Counsel will make it appear on record that if the motion and joint motion will
not be acted (upon) on March 21, 1990 as scheduled he will be forced much
to his regret to file the following administrative and criminal complaints,
against the presiding judge, namely:
1. violation of his oath;
2. falsification under Art. 171 of the Revised Penal Code;
3. knowingly rendering an unlawful order;
4. maliciously delaying the administration of justice;
5. grave misconduct. . . .
(2) his Reply to RTJ-89-361 dated May 18, 1990:
It is respectfully submitted, that the respondent has made Branch 68 as his
personal court thus making it as a court for his friends, the rich, powerful
and influential and against his foes, the poor and powerless. This claim will
be discussed lengthily in the next administrative charge which complainant
will file against the respondent [Emphasis supplied].
(3) his letter to the Court dated August 8, 1990, opposing respondent's application for
disability benefits because of the "pendency of administrative cases against him filed
by me and some more will follow as soon as I consolidate my evidences" [Emphasis
supplied].
In a memorandum dated July 13, 1990, the OCA, after enumerating some of the charges, noted
that complainant's persistent filing of administrative cases against respondent "signif(ies) a
desire to unjustifiably bring respondent to public disdain and ridicule." Also brought to the
attention of the Court was complainant's letter dated June 7, 1990, which contains accusations
that respondent has a "conspirator" in the Office of the Clerk of Court. The conspirator allegedly
inserted inconsistent words in a final Court resolution, and supplied lies in respondent's
comment. From the foregoing, the OCA recommended that complainant be strongly
reprimanded, if not suspended from the practice of law for three (3) months.
A careful study of the charges in these complaints, the Comment in RTJ-89-361, the Compliance
filed by respondent in RTJ-89-355, the records of the consolidated cases, and the memorandum
of the OCA dated July 13, 1990, clearly reveals that all but three cases ** can be dismissed
outright because: (1) the complainant failed to establish prima facie cases: (2) the complainant
filed administrative cases as substitute for the appropriate remedy in rulings adverse to him; and
(3) the complaints involve the appropriate exercise of respondent's discretionary authority.
First, no prima facie cases have been established in: (1) the Seventh Cause of Action in RTJ-89-
331, since the same grounds have already been found to be without merit by the Court
in Prudencio Penticostes, Sr. v. DBP, et al. [G.R. No. 89620, July 13, 1990]; (2) RTJ-89-361,
which charges respondent with falsification of three separate orders in three different cases,
since no indication of such falsification can be gleaned from the record; and (3) RTJ-89-438,
which takes issue with the order to archive Civil Case No. 280, "pending resolution of the
matters raised by complainant in the Supreme Court," there being nothing irregular in such
order.
Second, in the First, Second and Fifth Causes of Action in RTJ-89-331 (which arose from
respondent's dismissal of Civil Case Nos. 198, 234, and 205, respectively), the complainant
resorted to the filing of administrative complaints against respondent judge instead of availing of
the appropriate legal remedies from the adverse rulings, i.e., by motion for reconsideration,
appeal or petition for review or for certiorari.
Third, the complainant challenges the due exercise by respondent judge of his discretion in the
following instances: (1) RTJ-89-331, the Third Cause of Action, the order denying a motion to
declare defendants in contempt, and the order deferring action on a motion for an accounting of
harvests; the Fourth Cause of Action, the denial of a motion to dismiss; the Sixth Cause of
Action, the denial of a motion for inhibition and two motions for reconsideration; the Eighth
Cause of Action, the order setting aside an order of dismissal; the Ninth Cause of Action, the
order granting a motion for reconsideration; the Tenth Cause of Action, the denial of a motion for
inhibition; (2) RTJ-89-362, separate orders setting aside the amended complaints in Civil Case
Nos. 228, 253, 255, which complaints were amended to implead respondent as co-defendant for
his alleged use of his judicial powers to prejudice complainant during the proceedings of the
aforestated cases; (3) RTJ-89-355, direct contempt orders, and (4) RTJ-89-439, the failure of
respondent judge to strike out the answer in two civil cases.
Considering the nature, frequency and indiscriminate filing of groundless charges and despite
the admonition previously given by resolution of the Court dated June 20, 1989, which the
complainant willfully ignored and disobeyed by manifesting the intent to file more of the same,
the complainant imposed upon the time, resources and forbearance of the Court and diverted
the energies of the respondent judge who has been called upon to comment and defend his
every action. This is not to say that a judge may not be answerable for violation of the law and
the Code of Judicial Conduct, but not every order or ruling adverse to a party can be made the
basis for an administrative charge.
As a member of the bar, the complainant has responsibilities to the judiciary. The Code of
Professional Responsibility and the rules thereunder impose obligations on the lawyer in relation
to the court: Canon 10 states that a lawyer owes candor, fairness and good faith to the court.
Canon 11 provides that a lawyer shall observe and maintain the respect due to the court and to
judicial officers, while Canon 12 mandates that a lawyer shall exert very effort and consider it his
duty to assist in the speedy and efficient administration of justice. Through his imprudent filing of
administrative cases against respondent judge, complainant has transgressed the provisions of
the Code of Professional Responsibility and miserably failed to observe conduct expected of a
member of the bar under the Code and in accordance with his lawyer's oath.
WHEREFORE, having found the charges above-mentioned to be absolutely without basis, the
Court Resolved to:
(1) DISMISS outright the following complaints: RTJ-89-331; RTJ-89-362; RTJ-89-438; and RTJ-
89-355. RTJ-89-361 and RTJ 89-439 are likewise dismissed, except as to charges for which
comment has been required; and
(2) IMPOSE upon complainant a FINE of One Thousand Pesos (P1,000.00) payable within ten
(10) days from receipt of this Resolution, or IMPRISONMENT of ten (10) days in the local jail in
case of failure to pay the fine within the time appointed; and
(3) SUSPEND complainant from the practice of law for one (1) year for his willful disregard and
disobedience of the admonition made by the Court in RTJ-89-294, and his violation of Canons
10, 11 and 12 of the Code of Professional Responsibility, with a stern warning that a repetition of
the same will be dealt with more severely. The suspension shall take effect from the date of
receipt of this Resolution. Let copies of this Resolution be circulated to all courts of this country
for their information and guidance, and spread in the personal record of Atty. Penticostes.
SO ORDERED.
G.R. No. 102781. April 22, 1993.
BONIFACIO SANZ MACEDA, Presiding Judge, Branch 12, Regional Trial Court, Antique,
petitioner,
vs.
HON. OMBUDSMAN CONRADO M. VASQUEZ AND ATTY. NAPOLEON A. ABIERA,
respondents.
Bonifacio Sanz Maceda for and in his own behalf.
Public Attorney's Office for private respondent.
SYLLABUS
1. REMEDIAL LAW; JURISDICTION; OFFICE OF THE OMBUDSMAN HAS JURISDICTION TO
INVESTIGATE OFFENSE COMMITTED BY JUDGE WHETHER OR NOT OFFENSE RELATES
TO OFFICIAL DUTIES; REASON. — Petitioner also contends that the Ombudsman has no
jurisdiction over said cases despite this Court's ruling in Orap vs. Sandiganbayan, since the
offense charged arose from the judge's performance of his official duties, which is under the
control and supervision of the Supreme Court . . . The Court disagrees with the first part of
petitioner's basic argument. There is nothing in the decision in Orap that would restrict it only to
offenses committed by a judge unrelated to his official duties. A judge who falsifies his certificate
of service is administratively liable to the Supreme Court for serious misconduct and inefficiency
under Section 1, Rule 140 of the Rules of Court, and criminally liable to the State under the
Revised Penal Code for his felonious act.
2. ID.; ID.; ID.; JURISDICTION TO INVESTIGATE OFFENSE RELATED TO OFFICIAL DUTIES
SUBJECT TO PRIOR ADMINISTRATIVE ACTION TAKEN AGAINST JUDGE BY SUPREME
COURT; REASON. — However, We agree with petitioner that in the absence of any
administrative action taken against him by this Court with regard to his certificates of service, the
investigation being conducted by the Ombudsman encroaches into the Court's power of
administrative supervision over all courts and its personnel, in violation of the doctrine of
separation of powers.
3. ID.; ID.; ID.; ID.; PROCEDURE TO BE OBSERVED BY OMBUDSMAN REGARDING
COMPLAINT AGAINST JUDGE OR OTHER COURT EMPLOYEE; PURPOSE. — Thus, the
Ombudsman should first refer the matter of petitioner's certificates of service to this Court for
determination of whether said certificates reflected the true status of his pending case load, as
the Court has the necessary records to make such a determination . . . In fine, where a criminal
complaint against a judge or other court employee arises from their administrative duties, the
Ombudsman must defer action on said complaint and refer the same to this Court for
determination whether said judge or court employee had acted within the scope of their
administrative duties.
4. ID.; ID.; ID.; ID.; OMBUDSMAN CANNOT SUBPOENA SUPREME COURT AND ITS
PERSONNEL; REASON. — The Ombudsman cannot compel this Court, as one of the three
branches of government, to submit its records, or to allow its personnel to testify on this matter,
as suggested by public respondent Abiera in his affidavit-complaint. The rationale for the
foregoing pronouncement is evident in this case. Administratively, the question before Us is this:
should a judge, having been granted by this Court an extension of time to decide cases before
him, report these cases in his certificate of service? As this question had not yet been raised
with, much less resolved by, this Court, how could the Ombudsman resolve the present criminal
complaint that requires the resolution of said question?
DECISION
NOCON, J p:
The issue in this petition for certiorari with prayer for preliminary mandatory injunction and/or
restraining order is whether the Office of the Ombudsman could entertain a criminal complaint
for the alleged falsification of a judge's certification submitted to the Supreme Court, and
assuming that it can, whether a referral should be made first to the Supreme Court.
Petitioner Bonifacio Sanz Maceda, Presiding Judge of Branch 12 of the Regional Trial Court of
Antique, seeks the review of the following orders of the Office of the Ombudsman: (1) the Order
dated September 18, 1991 denying the ex-parte motion to refer to the Supreme Court filed by
petitioner; and (2) the Order dated November 22, 1951 denying petitioner's motion for
reconsideration and directing petitioner to file his counter-affidavit and other controverting
evidences.
In his affidavit-complaint dated April 18, 1991 filed before the Office of the Ombudsman,
respondent Napoleon A. Abiera of the Public Attorney's Office alleged that petitioner had falsified
his Certificate of Service 1 dated February 6, 1989, by certifying "that all civil and criminal cases
which have been submitted for decision or determination for a period of 90 days have been
determined and decided on or before January 31, 1998," when in truth and in fact, petitioner
knew that no decision had been rendered in five (5) civil and ten (10) criminal cases that have
been submitted for decision. Respondent Abiera further alleged that petitioner similarly falsified
his certificates of service for the months of February, April, May, June, July and August, all in
1989; and the months beginning January up to September 1990, or for a total of seventeen (17)
months.
On the other hand, petitioner contends that he had been granted by this Court an extension of
ninety (90) days to decide the aforementioned cases.
Petitioner also contends that the Ombudsman has no jurisdiction over said case despite this
Court's ruling in Orap vs. Sandiganbayan, 2 since the offense charged arose from the judge's
performance of his official duties, which is under the control and supervision of the Supreme
Court. Furthermore, the investigation of the Ombudsman constitutes an encroachment into the
Supreme Court's constitutional duty of supervision over all inferior courts.
The Court disagrees with the first Part of petitioner's basic argument. There is nothing in the
decision in Orap that would restrict it only to offenses committed by a judge unrelated to his
official duties. A judge who falsifies his certificate of service is administratively liable to the
Supreme Court for serious misconduct and inefficiency under Section 1, Rule 140 of the Rules
of Court, and criminally liable to the State under the Revised Penal Code for his felonious act.
However, We agree with petitioner that in the absence of any administrative action taken against
him by this Court with regard to his certificates of service, the investigation being conducted by
the Ombudsman encroaches into the Court's power of administrative supervision over all courts
and its personnel, in violation of the doctrine of separation of powers.
Article VIII, section 6 of the 1987 Constitution exclusively vests in the Supreme Court
administrative supervision over all courts and court personnel, from the Presiding Justice of the
Court of Appeals down to the lowest municipal trial court clerk. By virtue of this power, it is only
the Supreme Court that can oversee the judges' and court personnel's compliance with all laws,
and take the proper administrative action against them if they commit any violation thereof. No
other branch of government may intrude into this power, without running afoul of the doctrine of
separation of powers.
The Ombudsman cannot justify its investigation of petitioner on the powers granted to it by the
Constitution, 3 for such a justification not only runs counter to the specific mandate of the
Constitution granting supervisory powers to the Supreme Court over all courts and their
personnel, but likewise undermines the independence of the judiciary.
Thus, the Ombudsman should first refer the matter of petitioner's certificates of service to this
Court for determination of whether said certificates reflected the true status of his pending case
load, as the Court has the necessary records to make such a determination. The Ombudsman
cannot compel this Court, as one of the three branches of government, to submit its records, or
to allow its personnel to testify on this matter, as suggested by public respondent Abiera in his
affidavit-complaint. 4
The rationale for the foregoing pronouncement is evident in this case. Administratively. the
question before Us is this: should a judge, having been granted by this Court an extension of
time to decide cases before him, report these cases in his certificate of service? As this question
had not yet been raised with, much less resolved by, this Court. how could the Ombudsman
resolve the present criminal complaint that requires the resolution of said question?
In fine, where a criminal complaint against a Judge or other court employee arises from their
administrative duties, the Ombudsman must defer action on said complaint and refer the same
to this Court for determination whether said Judge or court employee had acted within the scope
of their administrative duties.
WHEREFORE, the instant petition is hereby GRANTED. The Ombudsman is hereby directed to
dismiss the complaint filed by public respondent Atty. Napoleon A. Abiera and to refer the same
to this Court for appropriate action.
SO ORDERED.
A.M. No. 188 November 29, 1976
RICARDA GABRIEL DE BUMANGLAG, complainant,
vs.
ESTEBAN T. BUMANGLAG, respondent.
RESOLUTION
TEEHANKEE, J.:
In the Court's decision of September 24, 1973, the Court found respondent guilty of gross
immoral conduct and ordered his suspension from the practice of law for a period of two (2)
years. Respondent filed several motions for reconsideration, all of which were denied per the
Court's Resolutions of November 20, 1973, December 19, 1973, January 9, 1974 and October
30, 1974.
On March 31, 1975, the Clerk of Court received a 1st Indorsement dated February 21, 1975
from then Assistant Executive Secretary Ronaldo B. Zamora "requesting comment and/or
appropriate action" on the therewith enclosed petition of respondent to the President of the
Philippines that he "promulgate(s) a decree that the order of suspension by the Supreme Court
be set aside and that your humble self be allowed to become an active member of the New
Society".
The Court per its Resolution of June 16, 1975 directed the Clerk of Court "to furnish the Office of SO ORDERED.
the President through Assistant Executive Secretary Zamora with copies of the Court's decision RE : SUSPENSION OF ATTY. ADM. CASE No. 7006
of September 24, 1973 wherein the Court in a spirit of liberality by majority vote imposed a ROGELIO Z. BAGABUYO, FORMER
lesser penalty of two-year suspension instead of disbarment (as voted by a minority composed SENIOR STATE PROSECUTOR Present:
of Justices Castro and Makasiar) and of the Court's resolutions of November 20, 1973 and
December 19, 1973 denying for lack of merit respondent's two motions for reconsideration dated PUNO, C.J.,
October 18, 1973 and December 12, 1973"; and further resolved "to require respondent to show QUISUMBING,
cause within ten (10) days from notice why he should not be subjected to further disciplinary YNARES-SANTIAGO,
action for making false statements and misrepresentations in his petition to the President that he SANDOVAL-GUTIERREZ.
has been allegedly deprived of due process of law contrary to the facts of record as stated in the CARPIO,
Court's decision, and for gross ignorance of the law and of the Constitution in asking the AUSTRIA-MARTINEZ,
President to set aside by decree this Court's decision imposing upon him two-year suspension CORONA,
from the practice of law". CARPIO MORALES,
AZCUNA,
In a 2nd Indorserment of June 18, 1975 and received by the Clerk of Court on the same day, TINGA,
then Assistant Executive Secretary Zamora forwarded respondent's letter of the same date to CHICO-NAZARIO,
the President stating that "(T)he undersigned by now (has) come to realize that I made a big GARCIA,
mistake by making said letter to you, Your Excellency, because the Honorable Supreme Court VELASCO, JR.,
may believe that I may be challenging the decision which is already final and executory and as NACHURA, and
such do not observe the doctrine of protocol of separation of power(s)", and withdrawing and REYES, JJ.
asking the President to disregard his first letter.
Promulgated:
October 9, 2007
Respondent in his Explanation of July 23, 1975 cited the fact that he had "immediately" X ------------------------------------------------------------------------------------------ X
withdrawn his letter asking for the President's intervention and that "lately, however, he has fully
realized that the Chief Executive is bereft (of) any authority to set aside or modify the decision of
this Honorable Supreme Court" and "with folded hands begs and asks an apology from the DECISION
members of this Honorable Court, with the full assurance that nothing of this sort will be
repeated by him in the future." AZCUNA, J.:

Respondent served his two-year suspension, as duly noted in the Court's Resolution of
November 7, 1975. Since respondent has apologized for his "big mistake" and now appreciates
that under the fundamental principle of separation of powers enshrined in both the 1935 and
1973 Constitutions, a decision of this Court may not be set aside by the President, the Court is
disposed to view his misconduct and/or ignorance with liberality and will administer a reprimand
with warning of severe action on any future transgressions, considering respondent's unenviable
record.
A final word is called for on respondent's statement in his Explanation inferring that he was led to
file his petition with the President by the fact that his motions for reconsideration "were only
denied by the Clerk of Court without any comment whatsoever". As the Court has had occasion
to state in People vs. Catolico * and earlier cases, this remark of respondent exposes his lack of
appreciation or disregard of the time-honored usage of the Court that minute resolutions,
summons and processes of the Court, upon being duly adopted and recorded are transmitted to
the interested parties by and upon the signature of the Clerk of Court who is duly authorized to
do so. With the thousands of resolutions approved monthly by the Court, it would unduly tax the
time and attention of the Chief Justice and members of the Court to the prejudice of the
administration of justice if all such papers, other than decisions, could be released only upon
their own signatures.
ACCORDINGLY, respondent is hereby administered a reprimand for gross ignorance of the law
and of the Constitution in having asked the President to set aside by decree the Court's decision
which suspended him for two years from the practice of law, with warning that the commission of
any transgression in the future of his oath and duties as a member of the bar will be severely
dealt with.
This administrative case stemmed from the events of the proceedings in Crim. Case
No. 5144, entitled People v. Luis Bucalon Plaza, heard before the sala of Presiding Judge Jose
Manuel P. Tan, Regional Trial Court (RTC) of Surigao City, Branch 29.
Crim. Case No. 5144 was originally raffled to the sala of Judge Floripinas C. Buyser,
RTC of Surigao City, Branch 30. In an Order dated March 14, 2002, Judge Buyser denied the
Demurrer to the Evidence of the accused, declaring that the evidence thus presented by the
prosecution was sufficient to prove the crime of homicide and not the charge of murder.
Consequently, the counsel for the defense filed a Motion to Fix the Amount of Bail
Bond. Respondent Atty. Rogelio Z. Bagabuyo, then Senior State Prosecutor and the deputized
prosecutor of the case, objected thereto mainly on the ground that the original charge
of murder, punishable with reclusion perpetua, was not subject to bail under Sec. 4, Rule 114 of
the Rules of Court.[1]
In an Order dated August 30, 2002,[2] Judge Buyser inhibited himself from further
trying the case because of the harsh insinuation of Senior Prosecutor Rogelio Z. Bagabuyo that
he lacks the cold neutrality of an impartial magistrate, by allegedly suggesting the filing of
the motion to fix the amount of bail bond by counsel for the accused.
The case was transferred to Branch 29 of the RTC of Surigao City, presided by Judge
Jose Manuel P. Tan. In an Order dated November 12, 2002, Judge Tan favorably
resolved the Motion to Fix the Amount of Bail Bond, and fixed the amount of the bond
at P40,000.
Respondent filed a motion for reconsideration of the Order dated November 12, 2002,
which motion was denied for lack of merit in an Order dated February 10, 2003. In October,
2003, respondent appealed from the Orders dated November 12, 2002 and February 10, 2003,
to the Court of Appeals (CA).
Instead of availing himself only of judicial remedies, respondent caused the publication
of an article regarding the Order granting bail to the accused in the August 18, 2003 issue of the
Mindanao Gold Star Daily. The article, entitled Senior prosecutor lambasts Surigao judge for
allowing murder suspect to bail out, reads:
SENIOR state prosecutor has lashed at a judge
in Surigao City for allowing a murder suspect to go out on bail.
Senior state prosecutor Rogelio Bagabuyo lambasted Judge
Manuel Tan of the Regional Trial Court (RTC) Branch 29 based
in Surigao City for ruling on a motion that sought a bailbond
for LuisPlaza who stands charged with murdering a policeman . . . .
Plaza reportedly posted a P40-thousand bail bond.
Bagabuyo argued that the crime of murder is a non-bailable
offense. But Bagabuyo admitted that a judge could still opt to allow a murder
suspect to bail out in cases when the evidence of the prosecution is weak.
But in this murder case, Bagabuyo said the judge who previously
handled it, Judge F[lori]pinasB[uy]ser, described the evidence to be
strong. B[uy]ser inhibited from the case for an unclear reason.
xxx
Bagabuyo said he would contest Tans decision before the Court
of Appeals and would file criminal and administrative charges
of certiorari against the judge.
Bagabuyuo said he was not afraid of being cited in contempt by
Judge Tan.
This is the only way that the public would know that there are
judges there who are displaying judicial arrogance. he said.[3]
In an Order dated August 21, 2003, the RTC of Surigao City, Branch 29, directed
respondent and the writer of the article, Mark Francisco of the Mindanao Gold Star Daily, to
appear in court on September 20, 2003 to explain why they should not be cited for indirect
contempt of court for the publication of the article which degraded the court and its presiding
judge with its lies and misrepresentation.
The said Order stated that contrary to the statements in the article, Judge Buyser
described the evidence for the prosecution as not strong, but sufficient to prove the guilt of the
accused only for homicide. Moreover, it was not true that Judge Buyser inhibited himself from
the case for an unclear reason. Judge Buyser, in an Order dated August 30, 2002, declared in
open court in the presence of respondent that he was inhibiting himself from the case due to the
harsh insinuation of respondent that he lacked the cold neutrality of an impartial judge.
On the scheduled hearing of the contempt charge, Mark Francisco admitted that the
Mindanao Gold Star Daily caused the publication of the article. He disclosed that respondent, in
a press conference, stated that the crime of murder is non-bailable. When asked by the trial
court why he printed such lies, Mr. Francisco answered that his only source was
respondent.[4] Mr. Francisco clarified that in the statement alleging that Judge Buyser inhibited
himself from the case for an unclear reason, the phrase for an unclear reason, was added by the
newspapers Executive Editor Herby S. Gomez.[5]
Respondent admitted that he caused the holding of the press conference, but refused
to answer whether he made the statements in the article until after he shall have filed a motion to
dismiss. For his refusal to answer, the trial court declared him in contempt of court pursuant to
Sec. 3, Rule 71 of the Rules of Court.[6] The Courts Order dated September 30, 2003 reads:
ORDER
Mr. Mark Francisco for publishing this article which is a lie clothed
in half truth to give it a semblance of truth is hereby ordered to pay a fine
of P10,000. Prosecutor Bagabuyo, for obstinately refusing to explain why he
should not be cited for contempt and admitting that the article published in
the Mindanao Gold Star Daily on August 18, 2003 and quoted in the Order
of this Court dated August 21, 2003 which is contemptuous was caused by
him to be published, is hereby adjudged to have committed indirect
contempt of Court pursuant to Section 3 of Rule 71 of the Rules of Court
and he is hereby ordered to suffer the penalty of 30 days in jail. The BJMP
is hereby ordered to arrest Prosecutor Rogelio Z. Bagabuyo if he does not
put up a bond of P100,000.00.
SO ORDERD.[7]
Respondent posted the required bond and was released from the custody of the
law. He appealed the indirect contempt order to the CA.
Despite the citation of indirect contempt, respondent presented himself to the media
for interviews in Radio Station DXKS, and again attacked the integrity of Judge Tan and the trial
courts disposition in the proceedings of Crim. Case No. 5144.
In an Order dated October 20, 2003, the RTC of Surigao City, Branch 29, required
respondent to explain and to show cause within five days from receipt thereof why he should not
be held in contempt for his media interviews that degraded the court and the presiding judge,
and why he should not be suspended from the practice of law for violating the Code of
Professional Responsibility, specifically Rule 11.05 of Canon 11[8] and Rule 13.02 of Canon 13.[9]
In the Order, the trial court stated that respondent was interviewed by Jun Clergio, and
that the interview was repeatedly aired on September 30, 2003 and in his news program
between 6:00 and 8:00 a.m. on October 1, 2003. He was also interviewed by Tony Consing on
October 1 and 2, 2003, between 8:00 and 9:00 a.m. in his radio program. In those radio
interviews, respondent allegedly called Judge Tan a judge who does not know the law, a liar,
and a dictator who does not accord due process to the people.
The hearing for the second contempt charge was set on December 4, 2003.
On November, 20, 2003, respondent filed an Urgent Motion for Extension of Time to
File Answer to Contempt alleging that he was saddled with work of equal importance and
needed ample time to answer the same. He also prayed for a bill of particulars in order to
properly prepare for his defense.
In an Order dated November 20, 2003, the trial court denied the motion. It stated that
a bill of particulars is not applicable in contempt proceedings, and that respondents actions and
statements are detailed in the Order of October 20, 2003.
On the scheduled hearing of December 4, 2003 respondent neither appeared in court
nor informed the court of his absence. The trial court issued an Order dated December 4, 2003
cancelling the hearing to give Prosecutor Bagabuyo all the chances he asks for, and
ordered him to appear on January 12, 2004 to explain in writing or orally why he should not be
cited in contempt of court pursuant to the facts stated in the Order dated October 20, bag-ong jurisprudence ug sa atong
2003. However, respondent did not appear in the scheduled hearing of January 12, 2004. balaod aron sa pagsiguro gayod nga
inigsang-at unya nako sa kaso
On January 15, 2004, the trial court received respondents Answer dated January 8, nga disbarment niining di mahibalo nga
2004. Respondent denied the charge that he sought to be interviewed by radio station Huwes, sigurado gayod ako nga
DXKS. He, however, stated that right after the hearing of September 30, 2003, he was katangtangan siya sa lisensiya . . .
approached by someone who asked him to comment on the Order issued in open court, and that . Ang kini nga Huwes nga dili mahibalo
his comment does not fall within the concept of indirect contempt of court. He also admitted that sa balaod, pagatangtangon na, dili
he was interviewed by his friend, Tony Consing, at the latters instance. He justified his response lamang sa pagka-Huwes kon dili sa
during the interview as a simple exercise of his constitutional right of freedom of speech and that pagka-abogado. Tan-awa ra gyod kining
it was not meant to offend or malign, and was without malice. iyang gibuhat nga Order, Ton, ang iyang
pagkabakakon . . . .
On February 8, 2004, the trial court issued an Order, the dispositive portion of which
reads: (Thats true, Ton, and this conviction I have now about judges who are
WHEREFORE, finding preponderant evidence that Prosecutor ignorant of the law is made firmer by
Bagabuyo has grossly violated the Canons of the legal profession and [is] time. I study everyday. I read new
guilty of grave professional misconduct, rendering him unfit to continue to be jurisprudence and the law to insure that
entrusted with the duties and responsibilities belonging to the office of an when I file the disbarment case
attorney, he is hereby SUSPENDED from the practice of law. against this Judge who does notknow
his law, I am certain that he loses his
Likewise, he is also found guilty of indirect contempt of court, for license. . . . This judge who is ignorant
which he is hereby ordered to suffer the penalty of IMPRISONMENT for of the law should not only be removed
ninety (90) days to be served at the Surigao City Jail and to pay the as a judge but should also be
maximum fine of THIRTY THOUSAND PESOS (P30,000.00). Future acts of disbarred. Just take a look at his Order,
contempt will be dealt with more severely. Ton, and see what a liar he is . . . .)

Let copies of the relevant records be immediately forwarded to xxx

the Supreme Court for automatic review and for further determination of
grounds for [the] disbarment of Prosecutor Rogelio Z. Bagabuyo. [10] BAGABUYO : Yes, nag-ingon ang iyang Order. . . . Ngano nga nakaingon
ako nga bakakon kini, nag-ingon nga
The trial court found respondents denials to be lame as the tape of his interview kini konong order given in open
on October 2, 2003, duly transcribed, showed disrespect of the court and its officers, thus: court, ang kalooy sa dios, ang
iyang order sa Korte wala siya mag-
TONY CONSING: Fiscal, nanglabay ang mga oras, nanglabay ingon ug kantidad
ang gamayng panahon ang samad sa nga P100,000.00 nga bail bond. . . .
imong kasingkasing nagpabilin pa ba
ni. O ingnon nato duna na bay pagbag-o (Yes, his Order said that . . . . Why did I say that he is a liar? It states that
sa imong huna-huna karon? this Order was given in open court,
and in Gods mercy, he did not state the
(Fiscal, after the lapse of time, are you still hurt? Or have you not changed amount of P100,000.00 as bailbond. . .
your mind yet?) .)

BAGABUYO : Ang akong huna-huna kon aduna man ugaling pagbag-o ang
pagsiguro, ang mga Huwes nga dili
mahibalo sa balaod tangtangon pagka
abogado, mao kana.
(If my mind has changed at all, it is that I ensure that all judges who are
ignorant of the law should be
disbarred. Thats it.)
BAGABUYO : Kay dili man lagi mahibalo sa balaod, ako
siyang gui-ingnan, Your Honor, I have the right to appeal. Mibalik dayon, ug
miingon siya, BJMP arrest Bagabuyo.
(Because he does not know the law, I
said, Your Honor, I have the right to
appeal. Then he came back and said,
BJMP, arrest Bagabuyo.)

xxx xxx

BAGABUYO : Mao kana ang tinuod, Ton, ug kining akong guibatonan karon
nga hunahuna mahitungod nianang mga
Huwes nga dili kahibalo sa balaod,
magkadugay magkalami. Kada adlao
nagatoon ako. Nagabasa ako sa mga
BAGABUYO : . . . P100,000.00 ang iyang guipapiyansa.
Naunsa na? Dinhi makita nimo ang
iyang pagka gross ignorance of the law.
...
(He imposed a bail of P100,000.00. How come? This is where you will
see his gross ignorance of the law. . . . )
xxx
TONY CONSING : So karon, unsay plano nimo karon?
(So what is your plan now?)
BAGABUYO : Sumala sa akong gui-ingon moundang lang ako kon
matangtang na siya sa pagka abogado.
...
(As I have said, I will only stop if he is already disbarred. . . .)
xxx
BAGABUYO : Nasuko siya niini kay hambugero kuno, pero angayan niyang
hibaw-an nga ang trabajo sa Huwes dili
ang pagtan-aw kon ang tawo
hambugero . . . . Ug ang akong gisulti
mao lamang ang balaod nga siya in fact
at that time I said he is not conversant of
the law, with regards to the case of
murder. . . .
(He got angry because I was allegedly bragging but he should know that it is
not for a judge to determine if a person
is a braggart. . . .And what I said was
based on the law. In fact, at that time, I
said he is not conversant of the law, with
regards to the case of murder . . . .)
xxx
BAGABUYO : Ah, mi sit down sab ako, contempt ra ba kadto . . . . Mao
kana, pero unsa may iyang katuyoan
ang iyang katuyoan nga ipa-adto ako
didto kay didto, iya akong pakauwawan
kay iya kong sikopon, iya kong ipa-priso,
pero kay di man lagi mahibalo sa
balaod, ang iyang gui orderan BJMP,
intawon por dios por Santo, Mr. Tan,
pagbasa intawon ug balaod, naunsa ka
ba Mr. Tan? Unsa may imong hunahuna
nga kon ikaw Huwes, ikaw na ang
diktador, no way, no sir, ours is a
democratic country where all and
everyone is entitled to due process of
law you did not accord me due process
of law . . . .
(I sat down. . . . Thats it. But what was his purpose? He made me come in
order to humiliate me because he
wanted me arrested, he wanted me
imprisoned, but because he is ignorant
of the law, he ordered the BMJP. For
Gods sake, Mr. Tan, whats wrong with
you, Mr. Tan? Please read the
law. What is your thinking? That when
you are a judge, you are also a
dictator? No way, no sir, ours is a
democratic country where all and
everyone is entitled to due process of
law you did not accord me due process
of law. . . .)
TONY CONSING: So mopasaka kang disbarment, malaumon kita nga
maaksiyonan kini, with all this
problem sa Korte Suprema.
(So you are filing a disbarment case? We hope that this be given action with
all the problems in the Supreme Court.)
BAGABUYO : Dili ako mabalaka niana kay usa ka truck ang
akong jurisprudence, nga ang mga
Huwes nga di mahibalo sa balaod
pagatangtangon gayod sa ilang pagka
Huwes. . . . Apan unsa man intawon ang
balaod ang iyang gibasa niini
nadunggan ko nga kini kuno siya
madjongero, mao bitaw na, madjong
ang iyang guitunan?
(I am not worried because I have a truckload of jurisprudence that judges
who are ignorant of the law must be
removed from the Bench. But what law
has he been reading? I heard that he is
a mahjong aficionado (mahjongero) and
that is why he is studying mahjong.[11]
The trial court concluded that respondent, as a member of the bar and an officer of the
court, is duty bound to uphold the dignity and authority of the court, and should not promote
distrust in the administration of justice.
The trial court stated that it is empowered to suspend respondent from the practice of
law under Sec. 28, Rule 138 of the Rules of Court [12] for any of the causes mentioned in Sec.
27[13] of the same Rule. Respondent was given the opportunity to be heard, but he opted to be
silent. Thus, it held that the requirement of due process has been duly satisfied.
In accordance with the provisions of Sec. 29, [14] Rule 138 and Sec. 9,[15] Rule 139 of
the Rules of Court, the RTC of Surigao City, Branch 29, transmitted to the Office of the Bar
Confidant the Statement of Facts of respondents suspension from the practice of law, dated July
14, 2005, together with the order of suspension and other relevant documents.
In its Report dated January 4, 2006, the Office of the Bar Confidant found that the
article in the August 18, 2003 issue of the Mindanao Gold Star Daily, which maligned the
integrity and independence of the court and its officers, and respondents criticism of the trial
courts Order dated November 12, 2002, which was aired in radio station DXKS, both in
connection with Crim. Case No. 5144, constitute grave violation of oath of office by
respondent. It stated that the requirement of due process was complied with when respondent
was given an opportunity to be heard, but respondent chose to remain silent.

The Office of the Bar Confidant recommended the implementation of the trial courts
order of suspension dated February 8, 2004, and that respondent be suspended from the
practice of law for one year, with a stern warning that the repetition of a similar offense will be
dealt with more severely.
The Court approves the recommendation of the Office of the Bar Confidant. It has
been reiterated in Gonzaga v. Villanueva, Jr.[16] that:
A lawyer may be disbarred or suspended for any violation of his
oath, a patent disregard of his duties, or an odious deportment unbecoming
an attorney. Among the grounds enumerated in Section 27, Rule 138 of the
Rules of Court are deceit; malpractice; gross misconduct in office; grossly
immoral conduct; conviction of a crime involving moral turpitude; any
violation of the oath which he is required to take before admission to the
practice of law; willful disobedience of any lawful order of a superior court;
corrupt or willful appearance as an attorney for a party to a case
without authority to do so. The grounds are not preclusive in nature even as
they are broad enough as to cover practically any kind of impropriety that a
lawyer does or commits in his professional career or in his private life. A
lawyer must at no time be wanting in probity and moral fiber which are not
only conditions precedent to his entrance to the Bar, but are likewise
essential demands for his continued membership therein.
Lawyers are licensed officers of the courts who are empowered to appear, prosecute
and defend; and upon whom peculiar duties, responsibilities and liabilities are devolved by law
as a consequence.[17] Membership in the bar imposes upon them certain obligations. [18] Canon
11 of the Code of Professional Responsibility mandates a lawyer to observe and maintain the
respect due to the courts and to judicial officers and [he] should insist on similar conduct by
others. Rule 11.05 of Canon 11 states that a lawyer shall submit grievances against a judge to
the proper authorities only.
Respondent violated Rule 11.05 of Canon 11 when he admittedly caused the holding
of a press conference where he made statements against the Order dated November 12,
2002 allowing the accused in Crim. Case No. 5144 to be released on bail.
Respondent also violated Canon 11 when he indirectly stated that Judge Tan was
displaying judicial arrogance in the article entitled, Senior prosecutor lambasts Surigao judge for
allowing murder suspect to bail out, which appeared in the August 18, 2003 issue of the
Mindanao Gold Star Daily. Respondents statements in the article, which were made while Crim.
Case No. 5144 was still pending in court, also violated Rule 13.02 of Canon 13, which states
that a lawyer shall not make public statements in the media regarding a pending case tending to
arouse public opinion for or against a party.
In regard to the radio interview given to Tony Consing, respondent violated Rule 11.05
of Canon 11 of the Code of Professional Responsibility for not resorting to the proper authorities
only for redress of his grievances against Judge Tan. Respondent also violated Canon 11 for his
disrespect of the court and its officer when he stated that Judge Tan was ignorant of the law,
that as a mahjong aficionado, he was studying mahjong instead of studying the law, and that he
was a liar.
Respondent also violated the Lawyers Oath, as he has sworn to conduct [himself] as a
lawyer according to the best of [his] knowledge and discretion with all good fidelity as well to the
courts as to [his] clients.
As a senior state prosecutor and officer of the court, respondent should have set the
example of observing and maintaining the respect due to the courts and to judicial
officers. Montecillo v. Gica[19] held:
It is the duty of the lawyer to maintain towards the courts a
respectful attitude. As an officer of the court, it is his duty to uphold the
dignity and authority of the court to which he owes fidelity, according to the
oath he has taken. Respect for the courts guarantees the stability of our
democratic institutions which, without such respect, would be resting on a
very shaky foundation.
The Court is not against lawyers raising grievances against erring judges but the rules
clearly provide for the proper venue and procedure for doing so, precisely because respect for
the institution must always be maintained.
WHEREFORE, in view of the foregoing, Atty. Rogelio Z. Bagabuyo is found guilty of
violating Rule 11.05, Canon 11 and Rule 13.02, Canon 13 of the Code of Professional
Responsibility, and of violating the Lawyers Oath, for which he is SUSPENDED from the practice
of law for one (1) year effective upon finality of this Decision, with a STERN WARNING that the
repetition of a similar offense shall be dealt with more severely.
Let copies of this Decision be furnished the Office of the Bar Confidant to be
appended to respondents personal record as an attorney, the Integrated Bar of the Philippines,
the Department of Justice, and all courts in the country for their information and guidance.
No costs.
SO ORDERED.
CANON 12
G.R. No. L-34369 September 30, 1974
ANTONIO VILLASIS, MATERNIDAD V. VILLASIS and SANTIAGO ORENDAIN, petitioners,
vs.
HONORABLE COURT OF APPEALS, ELEUTERIO VILLASIS and LAURA S.
VILLASIS, respondents.
Augusto A. Kimpo for petitioners.
Silvestre Untaran, Jr. for respondents.
TEEHANKEE, J.:p
The Court in dismissing the petition and affirming the appellate court's dismissal of petitioners-
appellants' appeal for failure to file appellants' brief finds that petitioners have shown no valid
and justifiable reason for their inexplicable failure to file their brief and have only themselves to
blame for their counsel's utter inaction and gross indifference and neglect in not having filed their
brief for a year since receipt of due notice to file the same.
The case originated in the Antique court of first instance where after due trial judgment was
rendered in favor of respondents-plaintiffs upholding their action for quieting of title with recovery
of possession and damages.
Petitioners-defendants appealed the adverse judgment to the Court of Appeals. On June 25,
1970, petitioners as appellants received notice through their counsel Benjamin M. Valente to
submit the appellants' brief within the reglementary forty-five day period to expire on August 9,
1970.
On August 10, 1970 (the last day of the reglementary period, August 9 being a Sunday),
petitioners' counsel, Atty. Valente, filed a motion to withdraw as counsel due to his having been
employed as technical assistant in the Supreme Court, with a prayer that appellants' newly
engaged counsel be given sufficient time to file their brief. Said new counsel, Atty. Esdras F.
Tayco, filed on August 18, 1970 his appearance with the appellate court.
On August 27, 1970, the appellate court received respondents-appellees' motion to dismiss the
appeal dated August 5, 1970 for appellants' failure to file their brief within the reglementary
period.
On September 12, 1970, the appellate court required both counsels of appellants, Atty. Valente
(whose withdrawal it held in abeyance until he filed a proper motion in verified form with the
signed conformity of the clients as per its resolution of August 18, 1970) and Atty. Tayco to
comment on the dismissal motion.
Withdrawing counsel Valente filed his manifestation dated September 28, 1970 alleging inter
alia that he had not received a copy of the dismissal motion and could not therefore comment
thereon and submitting therewith the signed conformity of his clients to his withdrawal and
reiterating his prayer for the court to grant his withdrawal and to grant appellants sufficient time
to file their brief. New counsel Tayco filed no comment whatsoever.
The appellate court granted withdrawing counsel's motion to withdraw per its resolution of
October 9, 1970 but meanwhile issued no resolution on the appellees' motion to dismiss the
appeal.
On June 25, 1971 or after the lapse of more than eleven (11 months or to be more exact, 319
days) without appellants having filed their brief at all, the appellate court's special sixth
division1 issued its resolution granting the dismissal motion and dismissing the appeal on the
ground stated by appellees in their motion that appellants had failed to file their brief within the
reglementary 45-day period.
It was only then that new counsel Tayco apparently stirred from almost a year of inaction and
filed a motion dated July 13, 1971 for reconsideration of the dismissal of the appeal on the
ground that he as new counsel had not received the notice to file brief. The appellate court per
its resolution of August 17, 1971 denied the motion for reconsideration, pointing out that
"Attorney Tayco's appearance was entered [on August 18, 1970] after the period for filing brief
had already expired [on August 10, 1970]."2
New counsel Tayco filed a second motion for reconsideration on September 10, 1971 still
without having filed appellants, brief, which the appellate court 3 denied per its resolution of
October 6, 1971.
Hence, the present appeal by certiorari wherein petitioners are represented by their third
counsel, Atty. Augusto A. Kimpo vice Atty. Tayco.
The appeal is patently without merit.
New counsel Tayco's claim in his motion for reconsideration that he had not received the notice
to file brief borders on the frivolous. Such notice to file brief had been received by his
predecessor-counsel Atty. Valente and is binding on him as the successor. A new counsel who
accepts a case in midstream is presumed and obliged to acquaint himself with all the antecedent
processes and proceedings that have transpired in the record prior to his takeover. It is
noteworthy that Atty. Tayco makes no claim that he was unaware that notice to file brief had
been duly served on Atty. Valente and that the period would expire on August 10, 1970 and that
Atty. Valente had asked in his two withdrawal motions that he (Tayco) as new counsel be
granted "sufficient time" to file the brief.
Here the notice to file the brief had been received on June 25, 1970 to expire on August 10,
1970. The appellate court did not dismiss the appeal at appellees' instance for failure of
appellants to file brief until one year later as per its resolution of June 25, 1971 or until almost
eleven months after the expiration of the reglementary period on August 10, 1970.
The appellate court gave appellants all the time and opportunity to duly prosecute their appeal
by filing their brief in the interval to no avail. It asked both counsels per its resolution of
September 12, 1970 (which in effect granted appellants the sufficient time asked by Atty.
Valente in his withdrawal motion to file their brief) to comment on the dismissal motion but
withdrawing counsel Valente claimed he could not file any comment as he had not received the
motion while new counsel Tayco ignored the court's resolution and filed no comment and filed no
brief!
Even going by new counsel Tayco's mistaken notion that he was entitled to a new notice to file
brief, the appellate court's resolution of September 12, 1970 requiring his comment on the
motion to dismiss appeal for failure to file appellant's brief was tantamount to such notice and he
should then have prepared and filed the brief within forty-five days thereafter. But as already
pointed out, he never filed the appellants' brief during the interval of almost 11 months that the
appellate court took before it finally dismissed the appeal per its resolution of June 25, 1971.
During all this period and even during the three months that followed when he filed two motions
for reconsideration, he presented no earnest of prosecuting the appeal by at least filing the brief
even at that late date but contented himself with a perfunctory prayer in his motion that
"appellants be allowed to file their brief."!
The appellate court committed no error therefore in dismissing the appeal. Petitioners-appellants
have shown no valid and justifiable reason for their inexplicable failure to file their brief and have
only themselves to blame for their counsel's utter inaction and grow indifference and neglect in
not having filed their brief for a year since receipt of due notice to file the same. They could not
even claim ignorance of the appellate court's notice to file brief since it had required withdrawing
counsel Valente to secure their written conformity before granting his withdrawal as counsel, and
certainly they must have ascertained from him as well as new counsel the status of their appeal
— which accounts for Atty. Valente's repeated prayers in his two motions for withdrawal for the
granting of sufficient time for new counsel to file the brief. They had almost a year thereafter to
make sure that their new counsel did attend to their appeal and did file the brief.
The case of Alonso vs. Rosario4 cited by petitioners is clearly inapplicable. There, appellants had
filed an opposition to the motion to dismiss their appeal (filed by appellee just five days after the
notice to file brief was served) asking that they be allowed to file the brief after notice of denial of
the motion, and when the appellate court denied both the dismissal and the extension, they
moved for reconsideration and for at least 15 days to file their brief, but the court therein both
denied reconsideration and dismissed the appeal as well for failure to file brief within the
reglementary period. Within five (5) days of such dismissal, appellants nevertheless filed their
brief. This Court in reinstating the appeal held that "the period consumed during the pendency of
the motion to dismiss should be excluded from the period given to petitioners to submit their
brief, and if this is done, the brief submitted by them on April 17, 1957 may be deemed
presented in due time."
It is manifest that there are two basic differences in this case: here, the motion to dismiss the
appeal was filed precisely on the ground of failure to file the brief after the expiration of the 45-
day reglementary period and no question of suspension of the period arises, whereas there, the
appellee questioned appellants' right to appeal when only 5 days of their 45-day period had
elapsed such that the rule5 that a motion to dismiss "interrupts the time to plea" was applied by
this Court by analogy; and here, petitioners-appellants never filed their brief while there
appellants immediately filed their brief within 5 days of notice of dismissal of their appeal.
It may parenthetically be noted that aside from petitioners' bare assertion of merit in their appeal,
the Court has not been shown that to reinstate the appeal would serve any purpose and not just
be a futile waste of time, since petitioners have never submitted their brief nor their proposed
assignment of errors against the trial court's verdict. To cap it all, petitioners in praying for a
reversal of the appellate court's dismissal of their appeal, pray that they be given an extension of
fifteen (15) days from notice of the decision within which to file the appellants' brief (at last!).
Such laches and lassitude on their part serve but to confirm the correctness of the appellate
court's dismissal of their appeal.
ACCORDINGLY, the petition at bar is dismissed with costs against petitioners.
G.R. Nos. 112438-39 December 12, 1995
CHEMPHIL EXPORT & IMPORT CORPORATION (CEIC), petitioner,
vs.
THE HONORABLE COURT OF APPEALS JAIME Y. GONZALES, as Assignee of the Bank
of the Philippine Islands (BPI), RIZAL COMMERCIAL BANKING CORPORATION (RCBC),
LAND BANK OF THE PHILIPPINES (LBP), PHILIPPINE COMMERCIAL & INTERNATIONAL
BANK (PCIB) and THE PHILIPPINE INVESTMENT SYSTEM ORGANIZATION
(PISO), respondents.
G.R. No. 113394 December 12, 1995
PHILIPPINE COMMERCIAL INDUSTRIAL BANK (AND ITS ASSIGNEE JAIME Y.
GONZALES) petitioner,
vs.
HONORABLE COURT OR APPEALS and CHEMPHIL EXPORT AND IMPORT
CORPORATION (CEIC), respondents.
KAPUNAN, J.:
Before us is a legal tug-of-war between the Chemphil Export and Import Corporation (hereinafter
referred to as CEIC), on one side, and the PISO and Jaime Gonzales as assignee of the Bank of
the Philippine Islands (BPI), Rizal Commercial Banking Corporation (RCBC), Land Bank of the
Philippines (LBP) and Philippine Commercial International Bank (PCIB), on the other (hereinafter
referred to as the consortium), over 1,717,678 shares of stock (hereinafter referred to as the
"disputed shares") in the Chemical Industries of the Philippines (Chemphil/CIP).
Our task is to determine who is the rightful owner of the disputed shares.
Pursuant to our resolution dated 30 May 1994, the instant case is a consolidation of two petitions
for review filed before us as follows:
In G.R. Nos. 112438-39, CEIC seeks the reversal of the decision of the Court of Appeals (former
Twelfth Division) promulgated on 30 June 1993 and its resolution of 29 October 1993, denying
petitioner's motion for reconsideration in the consolidated cases entitled "Dynetics, Inc., et al. v.
PISO, et al." (CA-G.R. No. 20467) and "Dynetics, Inc., et al. v. PISO, et al.; CEIC, Intervenor-
Appellee" (CA-G.R. CV No. 26511).
The dispositive portion of the assailed decision reads, thus:
WHEREFORE, this Court resolves in these consolidated cases as follows:
1. The Orders of the Regional Trial Court, dated March 25, 1988, and May
20, 1988, subject of CA-G.R. CV No. 10467, are SET ASIDE and judgment
is hereby rendered in favor of the consortium and against appellee Dynetics,
Inc., the amount of the judgment, to be determined by Regional Trial Court,
taking into account the value of assets that the consortium may have
already recovered and shall have recovered in accordance with the other
portions of this decision.
2. The Orders of the Regional Trial Court dated December 19, 1989 and
March 5, 1990 are hereby REVERSED and SET ASIDE and judgment is
hereby rendered confirming the ownership of the consortium over the
Chemphil shares of stock, subject of CA-G.R. CV No. 26511, and the Order
dated September 4, 1989, is reinstated.
No pronouncement as to costs.
SO ORDERED. 1
In G.R. No. 113394, PCIB and its assignee, Jaime Gonzales, ask for the annulment of the Court
of Appeals' decision (former Special Ninth Division) promulgated on 26 March 1993 in "PCIB v.
Hon. Job B. Madayag & CEIC" (CA-G.R. SP NO. 20474) dismissing the petition for certiorari,
prohibition and mandamus filed by PCIB and of said court's resolution dated 11 January 1994
denying their motion for reconsideration of its decision.2
The antecedent facts leading to the aforementioned controversies are as follows:
On September 25, 1984, Dynetics, Inc. and Antonio M. Garcia filed a complaint for declaratory
relief and/or injunction against the PISO, BPI, LBP, PCIB and RCBC or the consortium with the
Regional Trial Court of Makati, Branch 45 (Civil Case No. 8527), seeking judicial declaration,
construction and interpretation of the validity of the surety agreement that Dynetics and Garcia
had entered into with the consortium and to perpetually enjoin the latter from claiming, collecting
and enforcing any purported obligations which Dynetics and Garcia might have undertaken in
said agreement.3
The consortium filed their respective answers with counterclaims alleging that the surety
agreement in question was valid and binding and that Dynetics and Garcia were liable under the
terms of the said agreement. It likewise applied for the issuance of a writ of preliminary
attachment against Dynetics and Garcia.4
Seven months later, or on 23 April 1985, Dynetics, Antonio Garcia and Matrix Management &
Trading Corporation filed a complaint for declaratory relief and/or injunction against the Security
Bank & Trust Co. (SBTC case) before the Regional Trial Court of Makati, Branch 135 docketed
as Civil Case No. 10398.5
On 2 July 1985, the trial court granted SBTC's prayer for the issuance of a writ of preliminary
attachment and on 9 July 1985, a notice of garnishment covering Garcia's shares in
CIP/Chemphil (including the disputed shares) was served on Chemphil through its then
President. The notice of garnishment was duly annotated in the stock and transfer books of
Chemphil on the same date.6
On 6 September 1985, the writ of attachment in favor of SBTC was lifted. However, the same
was reinstated on 30 October 1985.7
In the meantime, on 12 July 1985, the Regional Trial Court in Civil Case No. 8527 (the
consortium case) denied the application of Dynetics and Garcia for preliminary injunction and
instead granted the consortium's prayer for a consolidated writ of preliminary attachment. Hence,
on 19 July 1985, after the consortium had filed the required bond, a writ of attachment was
issued and various real and personal properties of Dynetics and Garcia were garnished,
including the disputed shares.8 This garnishment, however, was not annotated in Chemphil's
stock and transfer book.
On 8 September 1987, PCIB filed a motion to dismiss the complaint of Dynetics and Garcia for
lack of interest to prosecute and to submit its counterclaims for decision, adopting the evidence it
had adduced at the hearing of its application for preliminary attachment. 9
On 25 March 1988, the Regional Trial Court dismissed the complaint of Dynetics and Garcia in
Civil Case No. 8527, as well as the counterclaims of the consortium, thus:
Resolving defendant's, Philippine Commercial International Bank, MOTION
TO DISMISS WITH MOTION TO SUBMIT DEFENDANT PCIBANK's
COUNTERCLAIM FOR DECISION, dated September 7, 1987:
(1) The motion to dismiss is granted; and the instant case is hereby ordered
dismissed pursuant to Sec. 3, Rule 17 of the Revised Rules of Court,
plaintiff having failed to comply with the order dated July 16, 1987, and
having not taken further steps to prosecute the case; and
(2) The motion to submit said defendant's counterclaim for decision is
denied; there is no need; said counterclaim is likewise dismissed under the
authority of Dalman vs. City Court of Dipolog City, L-63194, January 21,
1985, wherein the Supreme Court stated that if the civil case is dismissed,
so also is the counterclaim filed therein. "A person cannot eat his cake and
have it at the same time" (p. 645, record, Vol. I).10
The motions for reconsideration filed by the consortium were, likewise, denied by the trial court
in its order dated 20 May 1988:
The Court could have stood pat on its order dated 25 March 1988, in regard
to which the defendants-banks concerned filed motions for reconsideration.
However, inasmuch as plaintiffs commented on said motions that: "3). In
any event, so as not to unduly foreclose on the rights of the respective
parties to refile and prosecute their respective causes of action, plaintiffs
manifest their conformity to the modification of this Honorable Court's order
to indicate that the dismissal of the complaint and the counterclaims is
without prejudice." (p. 2, plaintiffs' COMMENT etc. dated May 20, 1988).
The Court is inclined to so modify the said order.
WHEREFORE , the order issued on March 25, 1988, is hereby modified in
the sense that the dismissal of the complaint as well as of the counterclaims
of defendants RCBC, LBP, PCIB and BPI shall be considered as without
prejudice (p. 675, record, Vol. I).11
Unsatisfied with the aforementioned order, the consortium appealed to the Court of Appeals,
docketed as CA-G.R. CV No. 20467.
On 17 January 1989 during the pendency of consortium's appeal in CA-G.R. CV No. 20467,
Antonio Garcia and the consortium entered into a Compromise Agreement which the Court of
Appeals approved on 22 May 1989 and became the basis of its judgment by compromise.
Antonio Garcia was dropped as a party to the appeal leaving the consortium to proceed solely
against Dynetics, Inc.12 On 27 June 1989, entry of judgment was made by the Clerk of Court. 13
Hereunder quoted are the salient portions of said compromise agreement:
xxx xxx xxx
3. Defendants, in consideration of avoiding an extended litigation, having
agreed to limit their claim against plaintiff Antonio M. Garcia to a principal
sum of P145 Million immediately demandable and to waive all other claims
to interest, penalties, attorney's fees and other charges. The aforesaid
compromise amount of indebtedness of P145 Million shall earn interest of
eighteen percent (18%) from the date of this Compromise.
4. Plaintiff Antonio M. Garcia and herein defendants have no further claims
against each other.
5. This Compromise shall be without prejudice to such claims as the parties
herein may have against plaintiff Dynetics, Inc.
6. Plaintiff Antonio M. Garcia shall have two (2) months from date of this
Compromise within which to work for the entry and participation of his other
creditor, Security Bank and Trust Co., into this Compromise. Upon the
expiration of this period, without Security Bank and Trust Co. having joined,
this Compromise shall be submitted to the Court for its information and
approval (pp. 27, 28-31, rollo, CA-G.R. CV No. 10467).14
It appears that on 15 July 1988, Antonio Garcia under a Deed of Sale transferred to Ferro
Chemicals, Inc. (FCI) the disputed shares and other properties for P79,207,331.28. It was
agreed upon that part of the purchase price shall be paid by FCI directly to SBTC for whatever
judgment credits that may be adjudged in the latter's favor and against Antonio Garcia in the
aforementioned SBTC case.15
On 6 March 1989, FCI, through its President Antonio M. Garcia, issued a Bank of America
Check No. 860114 in favor of SBTC in the amount of P35,462,869.62. 16 SBTC refused to
accept the check claiming that the amount was not sufficient to discharge the debt. The check
was thus consigned by Antonio Garcia and Dynetics with the Regional Trial Court as payment of
their judgment debt in the SBTC case.17
On 26 June 1989, FCI assigned its 4,119,614 shares in Chemphil, which included the disputed
shares, to petitioner CEIC. The shares were registered and recorded in the corporate books of
Chemphil in CEIC's name and the corresponding stock certificates were issued to it.18
Meanwhile, Antonio Garcia, in the consortium case, failed to comply with the terms of the
compromise agreement he entered into with the consortium on 17 January 1989. As a result, on
18 July 1989, the consortium filed a motion for execution which was granted by the trial court on
11 August 1989. Among Garcia's properties that were levied upon on execution were his
1,717,678 shares in Chemphil (the disputed shares) previously garnished on 19 July 1985. 19
On 22 August 1989, the consortium acquired the disputed shares of stock at the public auction
sale conducted by the sheriff for P85,000,000.00. 20 On same day, a Certificate of Sale covering
the disputed shares was issued to it.
On 30 August 1989,21 the consortium filed a motion (dated 29 August 1989) to order the
corporate secretary of Chemphil to enter in its stock and transfer books the sheriff's certificate of
sale dated 22 August 1989, and to issue new certificates of stock in the name of the banks
concerned. The trial court granted said motion in its order dated 4 September 1989, thus:
For being legally proper, defendant's MOTION TO ORDER THE
CORPORATE SECRETARY OF CHEMICAL INDUSTRIES OF THE
PHILS., INC. (CHEMPIL) TO ENTER IN THE STOCK AND TRANSFER
BOOKS OF CHEMPHIL THE SHERIFF'S CERTIFICATE OF SALE DATED
AUGUST 22, 1989 AND TO ISSUE NEW CERTIFICATES OF STOCK IN
THE NAME OF THE DEFENDANT BANKS, dated August 29, 1989, is
hereby granted.
WHEREFORE, the corporate secretary of the aforesaid corporation, or
whoever is acting for and in his behalf, is hereby ordered to (1) record
and/or register the Certificate of Sale dated August 22, 1989 issued by
Deputy Sheriff Cristobal S. Jabson of this Court; (2) to cancel the certificates
of stock of plaintiff Antonio M. Garcia and all those which may have
subsequently been issued in replacement and/or in substitution thereof; and
(3) to issue in lieu of the said shares new shares of stock in the name of the
defendant Banks, namely, PCIB, BPI, RCBC, LBP and PISO bank in such
proportion as their respective claims would appear in this suit (p. 82, record,
Vol. II).22
On 26 September 1989, CEIC filed a motion to intervene (dated 25 September 1989) in the
consortium case seeking the recall of the abovementioned order on grounds that it is the rightful
owner of the disputed shares.23 It further alleged that the disputed shares were previously owned
by Antonio M. Garcia but subsequently sold by him on 15 July 1988 to Ferro Chemicals, Inc.
(FCI) which in turn assigned the same to CEIC in an agreement dated 26 June 1989.
On 27 September 1989, the trial court granted CEIC's motion allowing it to intervene, but limited
only to the incidents covered by the order dated 4 September 1989. In the same order, the trial
court directed Chemphil's corporate secretary to temporarily refrain from implementing the 4
September 1989
order.24
On 2 October 1989, the consortium filed their opposition to CEIC's motion for intervention
alleging that their attachment lien over the disputed shares of stocks must prevail over the
private sale in favor of the CEIC considering that said shares of stock were garnished in the
consortium's favor as early as 19 July 1985.25
On 4 October 1989, the consortium filed their opposition to CEIC's motion to set aside the 4
September 1989 order and moved to lift the 27 September 1989 order.26
On 12 October 1989, the consortium filed a manifestation and motion to lift the 27 September
1989 order, to reinstate the 4 September 1989 order and to direct CEIC to surrender the
disputed stock certificates of Chemphil in its possession within twenty-four (24) hours, failing in
which the President, Corporate Secretary and stock and transfer agent of Chemphil be directed
to register the names of the banks making up the consortium as owners of said shares, sign the
new certificates of stocks evidencing their ownership over said shares and to immediately deliver
the stock certificates to them.27
Resolving the foregoing motions, the trial court rendered an order dated 19 December 1989, the
dispositive portion of which reads as follows:
WHEREFORE, premises considered, the Urgent Motion dated September
25, 1989 filed by CEIC is hereby GRANTED. Accordingly, the Order of
September 4, 1989, is hereby SET ASIDE, and any and all acts of the
Corporate Secretary of CHEMPHIL and/or whoever is acting for and in his
behalf, as may have already been done, carried out or implemented
pursuant to the Order of September 4, 1989, are hereby nullified.
PERFORCE, the CONSORTIUM'S Motions dated October 3, 1989 and
October 11, 1989, are both hereby denied for lack of merit.
The Cease and Desist Order dated September 27, 1989, is hereby
AFFIRMED and made PERMANENT.
SO ORDERED.28
In so ruling, the trial court ratiocinated in this wise:
xxx xxx xxx
After careful and assiduous consideration of the facts and applicable law
and jurisprudence, the Court holds that CEIC's Urgent Motion to Set Aside
the Order of September 4, 1989 is impressed with merit. The
CONSORTIUM has admitted that the writ of attachment/garnishment issued
on July 19, 1985 on the shares of stock belonging to plaintiff Antonio M.
Garcia was not annotated and registered in the stock and transfer books of
CHEMPHIL. On the other hand, the prior attachment issued in favor of
SBTC on July 2, 1985 by Branch 135 of this Court in Civil Case No. 10398,
against the same CHEMPHIL shares of Antonio M. Garcia, was duly
registered and annotated in the stock and transfer books of CHEMPHIL.
The matter of non-recording of the Consortium's attachment in Chemphil's
 stock and transfer book on the shares of Antonio M. Garcia assumes
significance considering CEIC's position that FCI and later CEIC acquired
the CHEMPHIL shares of Antonio M. Garcia without knowledge of the
attachment of the CONSORTIUM. This is also important as CEIC claims
that it has been subrogated to the rights of SBTC since CEIC's predecessor-
in-interest, the FCI, had paid SBTC the amount of P35,462,869.12 pursuant
to the Deed of Sale and Purchase of Shares of Stock executed by Antonio
M. Garcia on July 15, 1988. By reason of such payment, sale with the
knowledge and consent of Antonio M. Garcia, FCI and CEIC, as party-in-
interest to FCI, are subrogated by operation of law to the rights of SBTC.
The Court is not unaware of the citation in CEIC's reply that "as between
two (2) attaching creditors, the one whose claims was first registered on the
books of the corporation enjoy priority." (Samahang Magsasaka, Inc. vs.
Chua Gan, 96 Phil. 974.)
The Court holds that a levy on the shares of corporate stock to be valid and
binding on third persons, the notice of attachment or garnishment must be
registered and annotated in the stock and transfer books of the corporation,
more so when the shares of the corporation are listed and traded in the
stock exchange, as in this case. As a matter of fact, in the CONSORTIUM's
motion of August 30, 1989, they specifically move to "order the Corporate
Secretary of CHEMPHIL to enter in the stock and transfer books of
CHEMPHIL the Sheriff's Certificate of Sale dated August 22, 1989." This
goes to show that, contrary to the arguments of the CONSORTIUM, in order
that attachment, garnishment and/or encumbrances affecting rights and
ownership on shares of a corporation to be valid and binding, the same has
to be recorded in the stock and transfer books.
Since neither CEIC nor FCI had notice of the CONSORTIUM's attachment
of July 19, 1985, CEIC's shares of stock in CHEMPHIL, legally acquired
from Antonio M. Garcia, cannot be levied upon in execution to satisfy his
judgment debts. At the time of the Sheriff's levy on execution, Antonio M.
Garcia has no more in CHEMPHIL which could be levied upon.29
xxx xxx xxx
On 23 January 1990, the consortium and PCIB filed separate motions for reconsideration of the
aforestated order which were opposed by petitioner
CEIC.30
On 5 March 1990, the trial court denied the motions for
reconsideration.31
On 16 March 1990, the consortium appealed to the Court of Appeals (CA-G.R. No. 26511). In its
Resolution dated 9 August 1990, the Court of Appeals consolidated CA-G.R. No. 26511 with
CA-G.R. No. 20467.32
The issues raised in the two cases, as formulated by the Court of Appeals, are as follows:
I and have it at the same time. If the civil case is dismissed, so also is the
WHETHER OR NOT, UNDER THE PECULIAR CIRCUMSTANCES OF
THE CASE, THE TRIAL COURT ERRED IN DISMISSING THE
COUNTERCLAIMS OF THE CONSORTIUM IN CIVIL CASE NO. 8527;
II
WHETHER OR NOT THE DISMISSAL OF CIVIL CASE NO. 8527
RESULTED IN THE DISCHARGE OF THE WRIT OF ATTACHMENT
ISSUED THEREIN EVEN AS THE CONSORTIUM APPEALED THE
ORDER DISMISSING CIVIL CASE NO. 8527;
III
WHETHER OR NOT THE JUDGMENT BASED ON COMPROMISE
RENDERED BY THIS COURT ON MAY 22, 1989 HAD THE EFFECT OF
DISCHARGING THE ATTACHMENTS ISSUED IN CIVIL CASE NO. 8527;
IV
WHETHER OR NOT THE ATTACHMENT OF SHARES OF STOCK, IN
ORDER TO BIND THIRD PERSONS, MUST BE RECORDED IN THE
STOCK AND TRANSFER BOOK OF THE CORPORATION; AND
V
WHETHER OR NOT FERRO CHEMICALS, INC. (FCI), AND ITS
SUCCESSOR-IN-INTEREST, CEIC, WERE SUBROGATED TO THE
RIGHTS OF SECURITY BANK & TRUST COMPANY (SBTC) IN A
SEPARATE CIVIL ACTION. (This issue appears to be material as SBTC is
alleged to have obtained an earlier attachment over the same Chemphil
shares that the consortium seeks to recover in the case at bar). 33
On 6 April 1990, the PCIB separately filed with the Court of Appeals a petition for certiorari,
prohibition and mandamus with a prayer for the issuance of a writ of preliminary injunction (CA-
G.R. No. SP-20474), likewise, assailing the very same orders dated 19 December 1989 and 5
March 1990, subject of CA-G.R. No. 26511.34
On 30 June 1993, the Court of Appeals (Twelfth Division) in CA-G.R. No. 26511 and CA-G.R.
No. 20467 rendered a decision reversing the orders of the trial court and confirming the
ownership of the consortium over the disputed shares. CEIC's motion for reconsideration was
denied on 29 October 1993.35
In ruling for the consortium, the Court of Appeals made the following ratiocination: 36
On the first issue, it ruled that the evidence offered by the consortium in
support of its counterclaims, coupled with the failure of Dynetics and Garcia
to prosecute their case, was sufficient basis for the RTC to pass upon and
determine the consortium's counterclaims.
The Court of Appeals found no application for the ruling in Dalman v. City
Court of Dipolog, 134 SCRA 243 (1985) that "a person cannot eat his cake
counterclaim filed therein" because the factual background of the present
action is different. In the instant case, both Dynetics and Garcia and the
consortium presented testimonial and documentary evidence which clearly
should have supported a judgment on the merits in favor of the consortium.
As the consortium correctly argued, the net atrocious effect of the Regional
Trial Court's ruling is that it allows a situation where a party litigant is forced
to plead and prove compulsory counterclaims only to be denied those
counterclaims on account of the adverse party's failure to prosecute his
case. Verily, the consortium had no alternative but to present its
counterclaims in Civil Case No. 8527 since its counterclaims are
compulsory in nature.
On the second issue, the Court of Appeals opined that unless a writ of
attachment is lifted by a special order specifically providing for the discharge
thereof, or unless a case has been finally dismissed against the party in
whose favor the attachment has been issued, the attachment lien subsists.
When the consortium, therefore, took an appeal from the Regional Trial
Court's orders of March 25, 1988 and May 20, 1988, such appeal had the
effect of preserving the consortium's attachment liens secured at the
inception of Civil Case No. 8527, invoking the rule in Olib v. Pastoral, 188
SCRA 692 (1988) that where the main action is appealed, the attachment
issued in the said main case is also considered appealed.
Anent the third issue, the compromise agreement between the consortium
and Garcia dated 17 January 1989 did not result in the abandonment of its
attachment lien over his properties. Said agreement was approved by the
Court of Appeals in a Resolution dated 22 May 1989. The judgment based
on the compromise agreement had the effect of preserving the said
attachment lien as security for the satisfaction of said judgment (citing BF
Homes, Inc. v. CA, 190 SCRA 262, [1990]).
As to the fourth issue, the Court of Appeals agreed with the consortium's
position that the attachment of shares of stock in a corporation need not be
recorded in the corporation's stock and transfer book in order to bind third
persons.
Section 7(d), Rule 57 of the Rules of Court was complied with by the
consortium (through the Sheriff of the trial court) when the notice of
garnishment over the Chemphil shares of Garcia was served on the
president of Chemphil on July 19, 1985. Indeed, to bind third persons, no
law requires that an attachment of shares of stock be recorded in the stock
and transfer book of a corporation. The statement attributed by the Regional
Trial Court to the Supreme Court in Samahang Magsasaka,
Inc. vs. Gonzalo Chua Guan, G.R. No. L-7252, February 25, 1955
(unreported), to the effect that "as between two attaching creditors, the one
whose claim was registered first on the books of the corporation enjoys
priority," is an obiter dictum that does not modify the procedure laid down in
Section 7(d), Rule 57 of the Rules of Court.
Therefore, ruled the Court of Appeals, the attachment made over the
Chemphil shares in the name of Garcia on July 19, 1985 was made in
accordance with law and the lien created thereby remained valid and
subsisting at the time Garcia sold those shares to FCI (predecessor-in-
interest of appellee CEIC) in 1988.
Anent the last issue, the Court of Appeals rejected CEIC's subrogation
theory based on Art. 1302 (2) of the New Civil Code stating that the
obligation to SBTC was paid by Garcia himself and not by a third party
(FCI).
The Court of Appeals further opined that while the check used to pay SBTC
was a FCI corporate check, it was funds of Garcia in FCI that was used to
pay off SBTC. That the funds used to pay off SBTC were funds of Garcia
has not been refuted by FCI or CEIC. It is clear, therefore, that there was an
attempt on the part of Garcia to use FCI and CEIC as convenient vehicles to
deny the consortium its right to make itself whole through an execution sale
of the Chemphil shares attached by the consortium at the inception of Civil
Case No. 8527. The consortium, therefore, is entitled to the issuance of the
Chemphil shares of stock in its favor. The Regional Trial Court's order of
September 4, 1989, should, therefore, be reinstated in toto.
Accordingly, the question of whether or not the attachment lien in favor of
SBTC in the SBTC case is superior to the attachment lien in favor of the
consortium in Civil Case No. 8527 becomes immaterial with respect to the
right of intervenor-appellee CEIC. The said issue would have been relevant
had CEIC established its subrogation to the rights of SBTC.
On 26 March 1993, the Court of Appeals (Special Ninth Division) in CA-G.R. No. SP 20474
rendered a decision denying due course to and dismissing PCIB's petition for certiorari on
grounds that PCIB violated the rule against forum-shopping and that no grave abuse of
discretion was committed by respondent Regional Trial Court in issuing its assailed orders dated
19 December 1989 and 5 March 1990. PCIB's motion for reconsideration was denied on 11
January 1994.37
On 7 July 1993, the consortium, with the exception of PISO, assigned without recourse all its
rights and interests in the disputed shares to Jaime Gonzales. 38
On 3 January 1994, CEIC filed the instant petition for review docketed as G.R. Nos. 112438-39
and assigned the following errors:
I.
THE RESPONDENT COURT OF APPEALS GRAVELY ERRED IN
SETTING ASIDE AND REVERSING THE ORDERS OF THE REGIONAL
TRIAL COURT DATED DECEMBER 5, 1989 AND MARCH 5, 1990 AND IN
NOT CONFIRMING PETITIONER'S OWNERSHIP OVER THE DISPUTED
CHEMPHIL SHARES AGAINST THE FRIVOLOUS AND UNFOUNDED
CLAIMS OF THE CONSORTIUM.
II.
THE RESPONDENT COURT OF APPEALS GRAVELY ERRED:
(1) In not holding that the Consortium's attachment over
the disputed Chemphil shares did not vest any priority
right in its favor and cannot bind third parties since
admittedly its attachment on 19 July 1985 was not
recorded in the stock and transfer books of Chemphil,
and subordinate to the attachment of SBTC which
SBTC registered and annotated in the stock and
transfer books of Chemphil on 2 July 1985, and that the
Consortium's attachment failed to comply with Sec.
7(d), Rule 57 of the Rules as evidenced by the notice of
garnishment of the deputy sheriff of the trial court dated
 19 July 1985 (annex "D") which the sheriff served on a
certain Thelly Ruiz who was neither President nor
managing agent of Chemphil;
(2) In not applying the case law enunciated by this
Honorable Supreme Court in Samahang Magsasaka,
Inc. vs. Gonzalo Chua Guan, 96 Phil. 974 that as
between two attaching creditors, the one whose claim
was registered first in the books of the corporation
enjoys priority, and which respondent Court erroneously
characterized as mere obiter dictum;
(3) In not holding that the dismissal of the appeal of the
Consortium from the order of the trial court dismissing
its counterclaim against Antonio M. Garcia and the
finality of the compromise agreement which ended the
litigation between the Consortium and Antonio M.
Garcia in the Dynetics case had ipso jure discharged
the Consortium's purported attachment over the
disputed shares.
III.
THE RESPONDENT COURT OF APPEALS GRAVELY ERRED IN NOT
HOLDING THAT CEIC HAD BEEN SUBROGATED TO THE RIGHTS OF
SBTC SINCE CEIC'S PREDECESSOR IN INTEREST HAD PAID SBTC
PURSUANT TO THE DEED OF SALE AND PURCHASE OF STOCK
EXECUTED BY ANTONIO M. GARCIA ON JULY 15, 1988, AND THAT BY
REASON OF SUCH PAYMENT, WITH THE CONSENT AND
KNOWLEDGE OF ANTONIO M. GARCIA, FCI AND CEIC, AS PARTY IN
INTEREST TO FCI, WERE SUBROGATED BY OPERATION OF LAW TO
THE RIGHTS OF SBTC.
IV.
THE RESPONDENT COURT OF APPEALS GRAVELY ERRED AND
MADE UNWARRANTED INFERENCES AND CONCLUSIONS, WITHOUT
ANY SUPPORTING EVIDENCE, THAT THERE WAS AN ATTEMPT ON
THE PART OF ANTONIO M. GARCIA TO USE FCI AND CEIC AS
CONVENIENT VEHICLES TO DENY THE CONSORTIUM ITS RIGHTS TO
MAKE ITSELF WHOLE THROUGH AN EXECUTION OF THE CHEMPHIL
SHARES PURPORTEDLY ATTACHED BY THE CONSORTIUM ON 19
JULY 1985. 39
On 2 March 1994, PCIB filed its own petition for review docketed as G.R. No. 113394 wherein it
raised the following issues:
As previously stated, the issue boils down to who is legally entitled to the disputed shares of
Chemphil. We shall resolve this controversy by examining the validity of the claims of each party
I. RESPONDENT COURT OF APPEALS COMMITTED SERIOUS ERROR
and, thus, determine whose claim has priority.
IN RENDERING THE DECISION AND RESOLUTION IN QUESTION
(ANNEXES A AND B) IN DEFIANCE OF LAW AND JURISPRUDENCE BY
FINDING RESPONDENT CEIC AS HAVING BEEN SUBROGATED TO
THE RIGHTS OF SBTC BY THE PAYMENT BY FCI OF GARCIA'S DEBTS
TO THE LATTER DESPITE THE FACT THAT —
CEIC traces its claim over the disputed shares to the attachment lien obtained by SBTC on 2
July 1985 against Antonio Garcia in Civil Case No. 10398. It avers that when FCI, CEIC's
A. FCI PAID THE SBTC DEBT BY VIRTUE OF A
CONTRACT BETWEEN FCI AND GARCIA, THUS,
LEGAL SUBROGATION DOES NOT ARISE;
B. THE SBTC DEBT WAS PAID BY GARCIA HIMSELF
AND NOT BY FCI, HENCE, SUBROGATION BY
PAYMENT COULD NOT HAVE OCCURRED;
C. FCI DID NOT ACQUIRE ANY RIGHT OVER THE
DISPUTED SHARES AS SBTC HAD NOT YET
LEVIED UPON NOR BOUGHT THOSE SHARES ON
EXECUTION. ACCORDINGLY, WHAT FCI ACQUIRED
FROM SBTC WAS SIMPLY A JUDGMENT CREDIT
AND AN ATTACHMENT LIEN TO SECURE ITS
SATISFACTION.
II. RESPONDENT COURT OF APPEALS COMMITTED SERIOUS ERROR
IN SUSTAINING THE ORDERS OF THE TRIAL COURT DATED
DECEMBER 19, 1989 AND MARCH 5, 1990 WHICH DENIED
PETITIONER'S OWNERSHIP OVER THE DISPUTED SHARES
NOTWITHSTANDING PROVISIONS OF LAW AND EXTANT
JURISPRUDENCE ON THE MATTER THAT PETITIONER AND THE
CONSORTIUM HAVE PREFERRED SENIOR RIGHTS THEREOVER.
III. RESPONDENT COURT OF APPEAL COMMITTED SERIOUS ERROR
IN CONCLUDING THAT THE DISMISSAL OF THE COMPLAINT AND THE
COUNTERCLAIM IN CIVIL CASE NO. 8527 ALSO RESULTED IN THE
DISCHARGE OF THE WRIT OF ATTACHMENT DESPITE THE RULINGS
OF THIS HONORABLE COURT IN BF HOMES VS. COURT OF
APPEALS, G.R. NOS. 76879 AND 77143, OCTOBER 3, 1990, 190 SCRA
262, AND IN OLIB VS. PASTORAL, G.R. NO. 81120, AUGUST 20, 1990,
188 SCRA 692 TO THE CONTRARY.
IV. RESPONDENT COURT OF APPEALS EXCEEDED ITS JURISDICTION
IN RULING ON THE MERITS OF THE MAIN CASE NOTWITHSTANDING
THAT THOSE MATTERS WERE NOT ON APPEAL BEFORE IT.
V. RESPONDENT COURT OF APPEALS COMMITTED SERIOUS ERROR
IN HOLDING THAT PETITIONER IS GUILTY OF FORUM SHOPPING
DESPITE THE FACT THAT SC CIRCULAR NO. 28-91 WAS NOT YET IN
FORCE AND EFFECT AT THE TIME THE PETITION WAS FILED BEFORE
RESPONDENT APPELLATE COURT, AND THAT ITS COUNSEL AT THAT
TIME HAD ADEQUATE BASIS TO BELIEVE THAT CERTIORARI AND
NOT AN APPEAL OF THE TRIAL COURT'S ORDERS WAS THE
APPROPRIATE RELIEF.40
CEIC's claim
predecessor-in-interest, paid SBTC the due obligations of Garcia to the said bank pursuant to
the Deed of Absolute Sale and Purchase of Shares of Stock, 41FCI, and later CEIC, was
subrogated to the rights of SBTC, particularly to the latter's aforementioned attachment lien over
the disputed shares.
CEIC argues that SBTC's attachment lien is superior as it was obtained on 2 July 1985, ahead of
the consortium's purported attachment on 19 July 1985. More importantly, said CEIC lien was
duly recorded in the stock and transfer books of Chemphil.
CEIC's subrogation theory is unavailing.
By definition, subrogation is "the transfer of all the rights of the creditor to a third person, who
substitutes him in all his rights. It may either be legal or conventional. Legal subrogation is that
which takes place without agreement but by operation of law because of certain acts; this is the
subrogation referred to in article 1302. Conventional subrogation is that which takes place by
agreement of the parties . . ."42
CEIC's theory is premised on Art. 1302 (2) of the Civil Code which states:
Art. 1302. It is presumed that there is legal subrogation:
(1) When a creditor pays another creditor who is preferred, even without the
debtor's knowledge;
(2) When a third person, not interested in the obligation, pays with the
express or tacit approval of the debtor;
(3) When, even without the knowledge of the debtor, a person interested in
the fulfillment of the obligation pays, without prejudice to the effects of
confusion as to the latter's share. (Emphasis ours.)
Despite, however, its multitudinous arguments, CEIC presents an erroneous interpretation of the
concept of subrogation. An analysis of the situations involved would reveal the clear
inapplicability of Art. 1302 (2).
Antonio Garcia sold the disputed shares to FCI for a consideration of P79,207,331.28. FCI,
however, did not pay the entire amount to Garcia as it was obligated to deliver part of the
purchase price directly to SBTC pursuant to the following stipulation in the Deed of Sale:
Manner of Payment
Payment of the Purchase Price shall be made in accordance with the
following order of preferenceprovided that in no instance shall the total
amount paid by the Buyer exceed the Purchase Price:
a. Buyer shall pay directly to the Security Bank and Trust Co. the amount
determined by the Supreme Court as due and owing in favor of the said
bank by the Seller.
The foregoing amount shall be paid within fifteen (15) days from the date
the decision of the Supreme Court in the case entitled "Antonio M. Garcia,
et al. vs. Court of Appeals, et al." G.R. Nos. 82282-83 becomes final and
executory. 43 (Emphasis ours.)
Hence, when FCI issued the BA check to SBTC in the amount of P35,462,869.62 to pay
Garcia's indebtedness to the said bank, it was in effect paying with Garcia's money, no longer
with its own, because said amount was part of the purchase price which FCI owed Garcia in
payment for the sale of the disputed shares by the latter to the former. The money "paid" by FCI
to SBTC, thus properly belonged to Garcia. It is as if Garcia himself paid his own debt to SBTC
but through a third party — FCI.
It is, therefore, of no consequence that what was used to pay SBTC was a corporate check of
FCI. As we have earlier stated, said check no longer represented FCI funds but Garcia's money,
being as it was part of FCI's payment for the acquisition of the disputed shares. The FCI check
should not be taken at face value, the attendant circumstances must also be considered.
The aforequoted contractual stipulation in the Deed of Sale dated 15 July 1988 between Antonio
Garcia and FCI is nothing more but an arrangement for the sake of convenience. Payment was
to be effected in the aforesaid manner so as to prevent money from changing hands needlessly.
Besides, the very purpose of Garcia in selling the disputed shares and his other properties was
to "settle certain civil suits filed against him."44
Since the money used to discharge Garcia's debt rightfully belonged to him, FCI cannot be
considered a third party payor under Art. 1302 (2). It was but a conduit, or as aptly categorized
by respondents, merely an agent as defined in Art. 1868 of the Civil Code:
Art. 1868. By the contract of agency a person binds himself to render some
service or to do something in representation or on behalf of another, with
the consent or authority of the latter.
FCI was merely fulfilling its obligation under the aforementioned Deed of Sale.
Additionally, FCI is not a disinterested party as required by Art. 1302 (2) since the benefits of the
extinguishment of the obligation would redound to none other but itself. 45 Payment of the
judgment debt to SBTC resulted in the discharge of the attachment lien on the disputed shares
purchased by FCI. The latter would then have a free and "clean" title to said shares.
In sum, CEIC, for its failure to fulfill the requirements of Art. 1302 (2), was not subrogated to the
rights of SBTC against Antonio Garcia and did not acquire SBTC's attachment lien over the
disputed shares which, in turn, had already been lifted or discharged upon satisfaction by
Garcia, through FCI, of his debt to the said bank.46
The rule laid down in the case of Samahang Magsasaka, Inc. v. Chua Guan,47 that as between
two attaching creditors the one whose claim was registered ahead on the books of the
corporation enjoys priority, clearly has no application in the case at bench. As we have amply
discussed, since CEIC was not subrogated to SBTC's right as attaching creditor, which right in
turn, had already terminated after Garcia paid his debt to SBTC, it cannot, therefore, be
categorized as an attaching creditor in the present controversy. CEIC cannot resurrect and claim
a right which no longer exists. The issue in the instant case, then, is priority between an
attaching creditor (the consortium) and a purchaser (FCI/CEIC) of the disputed shares of stock
and not between two attaching creditors — the subject matter of the aforestated Samahang
Magsasaka case.
CEIC, likewise, argues that the consortium's attachment lien over the disputed Chemphil shares recorded in the corporation's stock and transfer book in order to have "force and effect as
is null and void and not binding on third parties due to the latter's failure to register said lien in against third persons."
the stock and transfer books of Chemphil as mandated by the rule laid down by the Samahang
Magsasaka v. Chua Guan.48
xxx xxx xxx

The attachment lien acquired by the consortium is valid and effective. Both the Revised Rules of
Court and the Corporation Code do not require annotation in the corporation's stock and transfer
books for the attachment of shares of stock to be valid and binding on the corporation and third
party.
Section 74 of the Corporation Code which enumerates the instances where registration in the
stock and transfer books of a corporation provides:
Sec. 74. Books to be kept; stock transfer agent. —
The word "transferencia" (transfer) is defined by the "Diccionario de la
Academia de la Lengua Castellana" as "accion y efecto de transfeir" (the act
and effect of transferring); and the verb "transferir", as "ceder or renunciar
en otro el derecho o dominio que se tiene sobre una cosa, haciendole
dueno de ella" (to assign or waive the right in, or absolute ownership of, a
thing in favor of another, making him the owner thereof).
In the Law Dictionary of "Words and Phrases", third series, volume 7, p.
5867, the word "transfer" is defined as follows:

xxx xxx xxx "Transfer" means any act by which property of one
person is vested in another, and "transfer of shares", as
used in Uniform Stock Transfer Act (Comp. St. Supp.
Stock corporations must also keep a book to be known as the stock and
690), implies any means whereby one may be divested
transfer book, in which must be kept a record of all stocks in the names of
of and another acquire ownership of stock. (Wallach vs.
the stockholders alphabetically arranged; the installments paid and unpaid
Stein [N.J.], 136 A., 209, 210.)
on all stock for which subscription has been made, and the date of payment
of any settlement; a statement of every alienation, sale or transfer of stock
made, the date thereof, and by and to whom made; and such other entries xxx xxx xxx
as the by-laws may prescribe. The stock and transfer book shall be kept in
the principal office of the corporation or in the office of its stock transfer
In the case of Noble vs. Ft. Smith Wholesale Grocery Co. (127 Pac., 14, 17;
agent and shall be open for inspection by any director or stockholder of the
34 Okl., 662; 46 L.R.A. [N.S.], 455), cited in Words and Phrases, second
corporation at reasonable hours on business days. (Emphasis ours.)
series, vol. 4, p. 978, the following appears:

xxx xxx xxx

A "transfer" is the act by which the owner of a thing
delivers it to another with the intent of passing the rights
Section 63 of the same Code states: which he has in it to the latter, and a chattel mortgage is
not within the meaning of such term.
Sec. 63. Certificate of stock and transfer of shares. — The capital stock of
stock corporations shall be divided into shares for which certificates signed xxx xxx xxx.50
by the president or vice-president, countersigned by the secretary or
assistant secretary, and sealed with the seal of the corporation shall be
Although the Monserrat case refers to a chattel mortgage over shares of stock, the same may be
issued in accordance with the by-laws. Shares of stock so issued are
applied to the attachment of the disputed shares of stock in the present controversy since an
personal property and may be transferred by delivery of the certificate or
attachment does not constitute an absolute conveyance of property but is primarily used as a
certificates indorsed by the owner or his attorney-in-fact or other person
means "to seize the debtor's property in order to secure the debt or claim of the creditor in the
legally authorized to make the transfer. No transfer, however, shall be valid,
event that a judgment is rendered."51
except as between the parties, until the transfer is recorded in the books of
the corporation so as to show the names of the parties to the transaction,
the date of the transfer, the number of the certificate or certificates and the Known commentators on the Corporation Code expound, thus:
number of shares transferred.
xxx xxx xxx
No shares of stock against which the corporation holds any unpaid claim
shall be transferable in the books of the corporation. (Emphasis ours.)
Shares of stock being personal property, may be the subject matter of
pledge and chattel mortgage. Such collateral transfers are however not
Are attachments of shares of stock included in the term "transfer" as provided in Sec. 63 of the covered by the registration requirement of Section 63, since our Supreme
Corporation Code? We rule in the negative. As succinctly declared in the case of Monserrat Court has held that such provision applies only to absolute transfers thus,
v. Ceron,49 "chattel mortgage over shares of stock need not be registered in the corporation's the registration in the corporate books of pledges and chattel mortgages of
stock and transfer book inasmuch as chattel mortgage over shares of stock does not involve a shares cannot have any legal effect. 52(Emphasis ours.)
"transfer of shares," and that only absolute transfers of shares of stock are required to be
 xxx xxx xxx
The requirement that the transfer shall be recorded in the books of the
corporation to be valid as against third persons has reference only to
absolute transfers or absolute conveyance of the ownership or title to a
share.
Consequently, the entry or notation on the books of the corporation of
pledges and chattel mortgages on shares is not necessary to their validity
(although it is advisable to do so) since they do not involve absolute
alienation of ownership of stock (Monserrat vs. Ceron, 58 Phil. 469 [1933];
Chua Guan vs. Samahang Magsasaka, Inc., 62 Phil. 472 [1935].) To affect
third persons, it is enough that the date and description of the shares
pledged appear in a public instrument. (Art. 2096, Civil Code.) With respect
to a chattel mortgage constituted on shares of stock, what is necessary is its
registration in the Chattel Mortgage Registry. (Act No. 1508 and Art. 2140,
Civil Code.)53
CEIC's reliance on the Samahang Magsasaka case is misplaced. Nowhere in the said decision
was it categorically stated that annotation of the attachment in the corporate books is mandatory
for its validity and for the purpose of giving notice to third persons.
The only basis, then, for petitioner CEIC's claim is the Deed of Sale under which it purchased
the disputed shares. It is, however, a settled rule that a purchaser of attached property acquires
it subject to an attachment legally and validly levied thereon.54
Our corollary inquiry is whether or not the consortium has indeed a prior valid and existing
attachment lien over the disputed shares.
Jaime Gonzales' /Consortium's Claim
Is the consortium's attachment lien over the disputed shares valid?
CEIC vigorously argues that the consortium's writ of attachment over the disputed shares of
Chemphil is null and void, insisting as it does, that the notice of garnishment was not validly
served on the designated officers on 19 July 1985.
To support its contention, CEIC presented the sheriff's notice of garnishment 55 dated 19 July
1985 which showed on its face that said notice was received by one Thelly Ruiz who was neither
the president nor managing agent of Chemphil. It makes no difference, CEIC further avers, that
Thelly Ruiz was the secretary of the President of Chemphil, for under the above-quoted
provision she is not among the officers so authorized or designated to be served with the notice
of garnishment.
We cannot subscribe to such a narrow view of the rule on proper service of writs of attachment.
A secretary's major function is to assist his or her superior. He/she is in effect an extension of
the latter. Obviously, as such, one of her duties is to receive letters and notices for and in behalf
of her superior, as in the case at bench. The notice of garnishment was addressed to and was
actually received by Chemphil's president through his secretary who formally received it for him.
Thus, in one case,56 we ruled that the secretary of the president may be considered an "agent"
of the corporation and held that service of summons on him is binding on the corporation.
Moreover, the service and receipt of the notice of garnishment on 19 July 1985 was duly
acknowledged and confirmed by the corporate secretary of Chemphil, Rolando Navarro and his
successor Avelino Cruz through their respective certifications dated 15 August 198957 and 21
August 1989.58
We rule, therefore, that there was substantial compliance with Sec. 7(d), Rule 57 of the Rules of
Court.
Did the compromise agreement between Antonio Garcia and the consortium discharge the
latter's attachment lien over the disputed shares?
CEIC argues that a writ of attachment is a mere auxiliary remedy which, upon the dismissal of
the case, dies a natural death. Thus, when the consortium entered into a compromise
agreement, 59 which resulted in the termination of their case, the disputed shares were released
from garnishment.
We disagree. To subscribe to CEIC's contentions would be to totally disregard the concept and
purpose of a preliminary attachment.
A writ of preliminary attachment is a provisional remedy issued upon order
of the court where an action is pending to be levied upon the property or
properties of the defendant therein, the same to be held thereafter by the
Sheriff as security for the satisfaction of whatever judgment might be
secured in said action by the attaching creditor against the
defendant.60 (Emphasis ours.)
Attachment is a juridical institution which has for its purpose to secure the
outcome of the trial, that is, the satisfaction of the pecuniary obligation really
contracted by a person or believed to have been contracted by him, either
by virtue of a civil obligation emanating from contract or from law, or by
virtue of some crime or misdemeanor that he might have committed, and
the writ issued, granted it, is executed by attaching and safely keeping all
the movable property of the defendant, or so much thereof may be sufficient
to satisfy the plaintiff's demands . . .61 (Emphasis ours.)
The chief purpose of the remedy of attachment is to secure a contingent lien
on defendant's property until plaintiff can, by appropriate proceedings,
obtain a judgment and have such property applied to its satisfaction, or to
make some provision for unsecured debts in cases where the means of
satisfaction thereof are liable to be removed beyond the jurisdiction, or
improperly disposed of or concealed, or otherwise placed beyond the reach
of creditors.62 (Emphasis ours.)
We reiterate the rule laid down in BF Homes, Inc. v. CA 63 that an attachment lien continues
until the debt is paid, or sale is had under execution issued on the judgment or until judgment is
satisfied, or the attachment discharged or vacated in the same manner provided by law. We
expounded in said case that:
The appointment of a rehabilitation receiver who took control and custody of
BF has not necessarily secured the claims of Roa and Mendoza. In the
event that the receivership is terminated with such claims not having been
satisfied, the creditors may also find themselves without security therefor in
the civil action because of the dissolution of the attachment. This should not
be permitted. Having previously obtained the issuance of the writ in good
 faith, they should not be deprived of its protection if the rehabilitation plan
does not succeed and the civil action is resumed.
xxx xxx xxx
As we ruled in Government of the Philippine Islands v. Mercado:
Attachment is in the nature of a proceeding in rem. It is
against the particular property. The attaching creditor
thereby acquires specific lien upon the attached
property which ripens into a judgment against
the res when the order of sale is made. Such a
proceeding is in effect a finding that the property
attached is an indebted thing and a virtual
condemnation of it to pay the owner's debt. The law
does not provide the length of time an attachment lien
shall continue after the rendition of judgment, and it
must therefore necessarily continue until the debt is
paid, or sale is had under execution issued on the
judgment or until judgment is satisfied, or the
attachment discharged or vacated in some manner
provided by law.
It has been held that the lien obtained by attachment
stands upon as high equitable grounds as a mortgage
lien:
The lien or security obtained by an attachment even
before judgment, is a fixed and positive security, a
specific lien, and, although whether it will ever be made
available to the creditor depends on contingencies, its
existence is in no way contingent, conditioned or
inchoate. It is a vested interest, an actual and
substantial security, affording specific security for
satisfaction of the debt put in suit, which constitutes a
cloud on the legal title, and is as specific as if created
by virtue of a voluntary act of the debtor and stands
upon as high equitable grounds as a mortgage. (Corpus
Juris Secundum, 433, and authorities therein cited.)
xxx xxx xxx
The case at bench admits of a peculiar character in the sense that it involves a compromise
agreement. Nonetheless, the rule established in the aforequoted cases still applies, even more
so since the terms of the agreement have to be complied with in full by the parties thereto. The
parties to the compromise agreement should not be deprived of the protection provided by an
attachment lien especially in an instance where one reneges on his obligations under the
agreement, as in the case at bench, where Antonio Garcia failed to hold up his own end of the
deal, so to speak.
Moreover, a violation of the terms and conditions of a compromise agreement entitles the
aggrieved party to a writ of execution.
In Abenojar & Tana v. CA, et al., 64 we held:
The non-fulfillment of the terms and conditions of a compromise agreement
approved by the Court justifies execution thereof and the issuance of the
writ for said purpose is the Court's ministerial duty enforceable
by mandamus.
Likewise we ruled in Canonizado v. Benitez:65
A judicial compromise may be enforced by a writ of execution. If a party fails
or refuses to abide by the compromise, the other party may enforce the
compromise or regard it as rescinded and insist upon his original demand.
If we were to rule otherwise, we would in effect create a back door by which a debtor can easily
escape his creditors. Consequently, we would be faced with an anomalous situation where a
debtor, in order to buy time to dispose of his properties, would enter into a compromise
agreement he has no intention of honoring in the first place. The purpose of the provisional
remedy of attachment would thus be lost. It would become, in analogy, a declawed and toothless
tiger.
From the foregoing, it is clear that the consortium and/or its assignee Jaime Gonzales have the
better right over the disputed shares. When CEIC purchased the disputed shares from Antonio
Garcia on 15 July 1988, it took the shares subject to the prior, valid and existing attachment lien
in favor of and obtained by the consortium.
Forum Shopping in G.R. No. 113394
We uphold the decision of the Court of Appeals finding PCIB guilty of forum-shopping.66
The Court of Appeals opined:
True it is, that petitioner PCIB was not a party to the appeal made by the
four other banks belonging to the consortium, but equally true is the rule that
where the rights and liabilities of the parties appealing are so interwoven
and dependent on each other as to be inseparable, a reversal of the
appealed decision as to those who appealed, operates as a reversal to all
and will inure to the benefit of those who did not join the appeal (Tropical
Homes vs. Fortun, 169 SCRA 80, p. 90, citing Alling vs. Wenzel, 133 111.
264-278; 4 C.J. 1206). Such principal, premised upon communality of
interest of the parties, is recognized in this jurisdiction (Director of Lands vs.
Reyes, 69 SCRA 415). The four other banks which were part of the
consortium, filed their notice of appeal under date of March 16, 1990,
furnishing a copy thereof upon the lawyers of petitioner. The petition
for certiorari in the present case was filed on April 10, 1990, long after the
other members of the consortium had appealed from the assailed order of
December 19, 1989.
We view with skepticism PCIB's contention that it did not join the consortium because it
"honestly believed that certiorari was the more efficacious and speedy relief available under the
circumstances."67 Rule 65 of the Revised Rules of Court is not difficult to
understand. Certiorari is available only if there is no appeal or other plain, speedy and adequate
remedy in the ordinary course of law. Hence, in instituting a separate petition for certiorari, PCIB
has deliberately resorted to forum-shopping.
PCIB cannot hide behind the subterfuge that Supreme Court Circular 28-91 was not yet in force
when it filed the certiorari proceedings in the Court of Appeals. The rule against forum-shopping
has long been established.68Supreme Court Circular 28-91 merely formalized the prohibition and
provided the appropriate penalties against transgressors.
It alarms us to realize that we have to constantly repeat our warning against forum-shopping. We
cannot over-emphasize its ill-effects, one of which is aptly demonstrated in the case at bench
where we are confronted with two divisions of the Court of Appeals issuing contradictory
decisions69 one in favor of CEIC and the other in favor of the consortium/Jaime Gonzales.
Forum-shopping or the act of a party against whom an adverse judgment has been rendered in
one forum, of seeking another (and possibly favorable) opinion in another forum (other than by
appeal or the special civil action of certiorari), or the institution of two (2) or more actions or
proceedings grounded on the same cause on the supposition that one or the other court would
make a favorable disposition,70 has been characterized as an act of malpractice that is prohibited
and condemned as trifling with the Courts and abusing their processes. It constitutes improper
conduct which tends to degrade the administration of justice. It has also been aptly described as
deplorable because it adds to the congestion of the already heavily burdened dockets of the
courts.71
WHEREFORE, premises considered the appealed decision in G.R. Nos. 112438-39 is hereby
AFFIRMED and the appealed decision in G.R. No. 113394, insofar as it adjudged the CEIC the
rightful owner of the disputed shares, is hereby REVERSED. Moreover, for wantonly resorting to
forum-shopping, PCIB is hereby REPRIMANDED and WARNED that a repetition of the same or
similar acts in the future shall be dealt with more severely.
SO ORDERED.
[A.C. No. 4058. March 12, 1998]
BENGUET ELECTRIC COOPERATIVE, INC. complainant, vs. ATTY. ERNESTO B.
FLORES, respondent.
DECISION
PANGANIBAN, J.:
The profession of law exacts the highest standards from its members and brooks no
violation of its code of conduct. Accordingly, a lawyer who trifles with judicial processes,
engages in forum shopping and blatantly lies in his pleadings must be sanctioned.
The Case
This is an administrative complaint against Atty. Ernesto Flores filed by Benguet Electric
Cooperative, Inc. (BENECO) before this Court on July 5, 1993, seeking his removal or
suspension from the bar for forum shopping, which amounted to grave misconduct, x x x unduly
delaying the administration of justice, and violating with impunity his oath of office and applicable
laws and jurisprudence.[1]
After the respondent submitted his Comment, dated August 21, 1993, we referred the
case to the Integrated Bar of the Philippines (IBP) on September 27, 1993 for investigation,
report and recommendation. On August 15, 1997, we received a resolution from the IBP Board
of Governors, finding respondent guilty of violating Canons 10 and 12 of the Code of
Professional Responsibility and recommending his suspension from the practice of law for a
period of six months, viz:
RESOLUTION NO. XII-97-149
Adm. Case NO. 4058
Benguet Electric Cooperative, Inc. vs.
Atty. Ernesto B. Flores
RESOLVED to ADOPT and APPROVE, as it is hereby ADOPTED and
APPROVED, the Report and Recommendation of the Investigating Commissioner in the
above-entitled case, hereinmade [sic] part of this Resolution/Decision as Annex A; and
finding the recommendation therein to be fully supported by the evidence on record and
the applicable laws and rules, Respondent Atty. Ernesto Flores is hereby SUSPENDED
from the practice of law for six (6) months for violating the provision of Canon[s] 10 and 12
of the Code of Professional Responsibility.[2]
The Facts
Because the parties[3] agreed to dispense with the presentation of testimonial evidence,
the case was submitted for resolution on the basis of their documentary evidence. As found by
Investigating Commissioner Plaridel C. Jose, the facts are as follows:
x x x. On February 25, 1993, Labor Arbiter Irenarco Rimando of the National Labor
Relations Commission, Regional Arbitration Branch, Cordillera Administrative Region,
Baguio City, issued a Writ of Execution (x x x) in NLRC Case No. RAB-1-0313-84 to
enforce the decision rendered by the Supreme Court on May 18, 1992 in G.R. No. 89070
(Benguet Electric Cooperative, Inc. vs. NLRC, 209 SCRA 55). The Writ of Execution was
issued on motion of Benguet Electric Cooperative (BENECO for short) to collect the
amount of P344,000.00 which it paid to Peter Cosalan during the pendency of the case
before the Supreme Court, on the basis of its decision ordering the respondent board
members to reimburse petitioner BENECO any amount that it may be compelled to pay to
respondent Cosalan by virtue of the decision of Labor Arbiter Amado T. Adquilen.
After issuance of the writ of execution, the respondent, as new counsel for the
losing litigant-members of the BENECO Board of Directors, filed a Motion for Clarification
with the Third Division of the Supreme Court in G.R. No. 89070, the minute resolution to
wit: to note without action the aforesaid motion.
Thereafter, the respondent instituted a suit docketed as Civil Case NO. 2738-R (x
x x) with the Regional Trial Court, Branch 7, Baguio City, seeking to enjoin the defendants
Clerk of Court, et al. from levying on their properties in satisfaction of the said writ of
execution. That case, however, was dismissed by the Presiding Judge Clarence
Villanueva in his Order dated March 18, 1993 (x x x).
 Accordingly, the Office of the Clerk of Court, MTC, Baguio City, through Sheriff III
Wilfredo Mendez, proceeded to levy on the properties of the losing board members of
BENECO. Thus, a sale at public auction was set on June 1, 1993, at 10:00 oclock in the
morning in front of the Baguio City Hall, per Sheriffs Notice of Sale dated May 4, 1993 (x x
x), of the properties of Abundio Awal and Nicasio Aliping[,] two of the losing members of
the Board of Directors of BENECO in the aforementioned case.
Respondent claims in his comment (x x x) that Branch 7, motu proprio, dismissed
Civil Case No. 2738-R for lack of jurisdiction on March 18,1993, which dismissal was [sic]
became final due to respondents failure to perfect an appeal therefrom which claim
according to the complainant, constitute[s] deliberate misrepresentation, if not falsehood,
because the respondent indeed interposed an appeal such that on May 11, 1993, the RTC
7 of Baguio City transmitted the entire record of Civil Case No. 2738-R to the Court of
Appeals per certified machine copy of the letter transmittal of same date (x x x).
While respondent never essentially intended to assail the issuance by the NLRC of
the Writ of Execution x x x nor sought to undo it (x x x) the complaint in Civil Case No.
2738-R which he filed prays for the immediate issuance of a temporary restraining order
and/or preliminary writ of injunction for defendants Clerk of Court and Ex-Officio City
Sheriff to cease and desist from enforcing the execution and levy of the writ of execution
issued by the NLRC-CAR, pending resolution of the main action in said court (x x x) which
complainant likewise claims as an unprocedural maneuver to frustrate the execution of the
decision of the Supreme Court in G.R. No. 89070 in complete disregard of settled
jurisprudence that regular courts have no jurisdiction to hear and decide questions which
arise and are incidental to the enforcement of decisions, orders and awards rendered in
labor cases citing the case of Cangco vs. CA, 199 SCRA 677, a display of gross
ignorance of the law.
On May 26, 1993, respondent again filed for Abundio Awal and Nicasio Aliping with the
Regional Trial Court, Branch 9, La Trinidad, Benguet, separate complaints for Judicial
Declaration of Family Home Constituted, Ope Lege, and thus Exempt from Levy and
Execution the subject properties with Damages, etc. docketed as Civil Cases Nos. 93-F-
0414 (x x x) and 93-F-0415 (x x x), which are essentially similar actions to enjoin the
enforcement of the judgment rendered in NLRC Case No. RAB-1-0313-84. He also filed
an urgent Motion Ex-parte (x x x) praying for temporary restraining order in these two (2)
cases.
The complainant further alleges that respondents claim for damages against the
defendant Sheriff is another improper and unprocedural maneuver which is likewise a
violation of respondents oath not to sue on groundless suit since the said Sheriff was
merely enforcing a writ of execution as part of his job.
Recommendation of the IBP
As noted earlier, Investigating Commissioner Plaridel C. Jose recommended, and the IBP
Board of Governors concurred, that respondent be suspended from the bar for six months for:
1. Falsehood, for stating in his comment before this Court that the order of the RTC
dismissing the complaint in Civil Case No. 2738-R was not appealed on time
2. Failure to comply with Supreme Court Circular No. 28-91 on forum shopping
Commissioner Jose ratiocinated:
A cursory glance of (sic) x x x the complaint filed by the respondent in Civil Case No. 2738-R
before the RTC of Baguio City, which complaint was signed and verified under oath by the
respondent, reveals that it lacks the certification required by Supreme Court Circular No. 28-91
which took effect on January 1, 1992 to the effect that to the best of his knowledge, no such
action or proceeding is pending in the Supreme Court, Court of Appeals or different divisions
thereof or any tribunal or agency. If there is any other action pending, he must state the status of
the same. If he should learn that a similar action or proceeding has been filed or pending before
the Supreme Court, Court of Appeals or different divisions thereof or any tribunal or agency[,] he
should notify the court, tribunal or agency within five (5) days from such notice.
Among the other penalties, the said circular further provides that the lawyer may also be
subjected to disciplinary proceedings for non-compliance thereof.
In sum, it is clear that the respondent violated the provisions of Canon[s] 10 and 12 of the Code
of Professional Responsibility under which the lawyer owes candor, fairness and good faith to
the court and exert[s] every effort and consider[s] it his duty to assist in the speedy and efficient
administration of justice.[4]
This Courts Ruling
We adopt and affirm the recommendation of the IBP suspending the respondent from the
bar, but we increase the period from six (6) months to one (1) year and six (6) months.
Forum Shopping
Circular No. 28-91,[5] dated September 4, 1991 which took effect on January 1, 1992,
requires a certificate of non-forum shopping to be attached to petitions filed before this Court and
the Court of Appeals. This circular was revised on February 8, 1994. The IBP found that the
respondent had violated it, because the complaint he filed before the RTC of Baguio City
lack[ed] the certification required by Supreme Court Circular No. 28-91.[6]
We distinguish. Respondents failure to attach the said certificate cannot be deemed a
violation of the aforementioned circular, because the said requirement applied only to petitions
filed with this Court and the Court of Appeals.[7] Likewise inapplicable is Administrative Circular
No. 04-94 dated February 8, 1994 which extended the requirement of a certificate of non-forum
shopping to all initiatory pleadings filed in all courts and quasi-judicial agencies other than this
Court and the Court of Appeals. Circular No. 04-94 became effective only on April 1, 1994, but
the assailed complaint for injunction was filed on March 18, 1993, and the petition for the
constitution of a family home was instituted on May 26, 1993.
Be that as it may, respondent is still guilty of forum shopping. In Chemphil Export and
Import Corporation vs. Court of Appeals,[8] this Court declared that (t)he rule against forum
shopping has long been established and subsequent circulars [9] of this Court merely formalized
the prohibition and provided the appropriate penalties against transgressors. The prohibition is
found in Section 1(e) of Rule 16 and Section 4 of Rule 2 of the 1964 Rules of Court, which
provide:
SECTION 1. Grounds. -- Within the time for pleading, a motion to dismiss the action may be
made on any of the following grounds:
 xxx xxx xxx
(e) That there is another action pending between the same parties for the same cause;
xxx xxx xxx[10]
SEC. 4. Effect of splitting a single cause of action. -- If two or more complaints are brought for
different parts of a single cause of action, the filing of the first may be pleaded in abatement of
the other or others, in accordance with section 1 (e) of Rule 16, and a judgment upon the merits
in any one is available as a bar in the others.[11]
The prohibition is also contained in Circular No. 28-91. This circular did not only require
that a certification of non-forum shopping be attached to the petitions filed before this Court or
the Court of Appeals; it also decreed that forum shopping constituted direct contempt of court
and could subject the offending lawyer to disciplinary action. The third paragraph thereof reads:
3. Penalties.
(a) Any violation of this Circular shall be a cause for the summary dismissal of the multiple
petition or complaint.
(b) Any willful and deliberate forum shopping by any party and his lawyer wit the filing of multiple
petitions and complaints to ensure favorable action shall constitute direct contempt of court.
(c) The submission of false certification under Par. 2 of the Circular shall likewise constitute
contempt of Court, without prejudice to the filing of criminal action against the guilty party. The
lawyer may also be subjected to disciplinary proceedings. (Underscoring supplied.)
The foregoing were substantially reproduced in Revised Circular No. 28-91[12] and
Administrative Circular No. 04-94.[13]
In a long line of cases, this Court has held that forum shopping exists when, as a result of
an adverse opinion in one forum, a party seeks a favorable opinion (other than by appeal or
certiorari) in another,[14]or when he institutes two or more actions or proceedings grounded on
the same cause, on the gamble that one or the other court would make a favorable
disposition.[15] The most important factor in determining the existence of forum shopping is the
vexation caused the courts and parties-litigants by a party who asks different courts to rule on
the same or related causes or grant the same or substantially the same reliefs.[16]
After this Court rendered its Decision[17] in Benguet Electric Cooperative, Inc. vs. National
Labor Relations Commission, et al.[18] and upon motion of BENECO, Labor Arbiter Irenarco R.
Rimando issued a writ of execution[19] ordering the clerk of court and ex officio city sheriff of the
Municipal Trial Court of Baguio City to levy on and sell at public auction personal and real
property of the members of the Board of Directors of BENECO.
On March 18, 1993, Respondent Flores, acting as counsel for BENECO Board Members
Victor Laoyan, Nicasio Aliping, Lorenzo Pilando and Abundio Awal, filed with the RTC an
injunction suit praying for the issuance of a temporary restraining order (TRO) to preserve
the status quo as now obtaining between the parties, as well as a writ of preliminary preventive
injunction ordering the clerk of court and the ex officio city sheriff of the MTC of Baguio to cease
and desist from enforcing by execution and levy the writ of execution from the NLRC-CAR,
pending resolution of the main action raised in court.[20]
When this injunction case was dismissed, Respondent Flores filed with another branch of
the RTC two identical but separate actions both entitled Judicial Declaration of Family Home
Constituted, ope lege,Exempt from Levy and Execution; with Damages, etc., docketed as Civil
Case Nos. 93-F-0414 and 93-F-0415.[21] The said complaints were supplemented by an Urgent
Motion Ex Parte[22] which prayed for an order to temporarily restrain Sheriff Wilfredo V. Mendez
from proceeding with the auction sale of plaintiffs property to avoid rendering ineffectual and
functus [oficio] any judgment of the court later in this [sic] cases, until further determined by the
court.
Civil Case Nos. 93-F-0414 and 93-F-0415 are groundless suits. Modequillo vs.
Breva,[23] reiterated in Manacop vs. Court of Appeals,[24] shows the frivolity of these proceedings:
Under the Family Code, a family home is deemed constituted on a house and lot from the time it
is occupied as a family residence. There is no need to constitute the same judicially or
extrajudicially as required in the Civil Code. If the family actually resides in the premises, it is,
therefore, a family home as contemplated by law. Thus, the creditors should take the necessary
precautions to protect their interest before extending credit to the spouses or head of the family
who owns the home.
xxx.
The exemption provided as aforestated is effective from the time of the constitution of the family
home as such, and lasts so long as any of its beneficiaries actually resides therein.
Adhering to the Courts declaration in said cases, the subject properties are deemed
constituted as family homes by operation of law under Article 153 of the Family Code.
The suits for the constitution of a family home were not only frivolous and
unnecessary; they were clearly asking for reliefs identical to the prayer previously dismissed by
another branch of the RTC, i.e., to forestall the execution of a final judgment of the labor
arbiter. That they were filed ostensibly for the judicial declaration of a family home was a mere
smoke screen; in essence, their real objective was to restrain or delay the enforcement of the
writ of execution. In his deliberate attempt to obtain the same relief in two different courts,
Respondent Flores was obviously shopping for a friendly forum which would capitulate to his
improvident plea for an injunction and was thereby trifling with the judicial process. [25]
We remind the respondent that, under the Code of Professional Responsibility, [26] he had a
duty to assist in the speedy and efficient administration of justice. [27] The Code also enjoins him
from unduly delaying a case by impeding the execution of a judgment or by misusing court
processes.[28]
In consonance with Millare vs. Montero[29] and Garcia vs. Francisco,[30] respondent should
be suspended from the practice of law for one year. In Millare, the respondent filed with different
courts a total of six appeals, complaints and petitions which frustrated and delayed the execution
of a final judgment.Holding that respondent made a mockery of the judicial processes and
disregarded canons of professional ethics in intentionally frustrating the rights of a litigant in
whose favor a judgment in the case was rendered [and], thus, abused procedural rules to defeat
the ends of substantial justice,[31] this Court suspended the respondent from the practice of law
for one year.
In Garcia, the respondent was also suspended for one year from the practice of law, for
violating the proscription against forum shopping. This Court held that he deserve[d] to be
sanctioned, not only as a punishment for his misconduct but also as a warning to other lawyers
who may be influenced by his example.[32]
 Falsehood
The investigating commissioner also held respondent liable for committing a falsehood
because, in this administrative case, he stated in his comment that he had not perfected an
appeal on the dismissal of his petition for injunction. In his said comment, the respondent stated:
Branch 7 (of the RTC) motu proprio, dismissed the case for lack of jurisdiction on March 18,
1993. Not having perfected an appeal on the dismissal, the order of dismissal became final
under the Rules 15 days after its receipt by respondent on record, or before April 6, 1993. So
that today this case is no longer pending.
xxx.
It should be noted that when Civil Case Nos. 93-F-0414 and 93-F-0415 for family homes and
damages were filed in the court below on May 26, 1993, Civil Case NO. 2378-R which seems to
give basis to the present Complaint was deemed terminated, there being no appeal formally
taken and perfected in accordance with the Rules.
xxx.
And that precisely was the primal reason why respondent decided not to appeal any further
anymore [sic] the order of dismissal for lack of jurisdiction of the court below in Civil Case No.
2738, and let it be deemed final by the Rules and jurisprudence. [33] (Underscoring supplied.)
The indelible fact, however, is that respondent did file an appeal which was perfected later
on. The original records of the injunction suit had been transmitted to the appellate
court.[34] Moreover, the Court of Appeals issued a resolution dismissing the appeal. [35] Thus, in
denying that he had appealed the decision of the RTC, respondent was making a false
statement.
Respondent argues that the withdrawal of his appeal means that no appeal was made
under Section 2 of Rule 50 of the Rules of Court. The pertinent provisions of Rule 50[36]read:
SEC. 2. Effect of dismissal.-- Fifteen (15) days after the dismissal of an appeal, the clerk shall
return to the court below the record on appeal with a certificate under the seal of the court
showing that the appeal has been dismissed. Upon the receipt of such certificate in the lower
court the case shall stand there as though no appeal had ever been taken, and the judgment of
the said court may be enforced with the additional costs allowed by the appellate court upon
dismissing the appeal.
xxx xxx xxx
SEC. 4. Withdrawal of appeal.-- An appeal may be withdrawn as of right at any time before the
filing of appellees brief. x x x. The withdrawal of an appeal shall have the same effect as that of a
dismissal in accordance with section 2 of this rule.
Respondents explanation misses the point. True, he withdrew his appeal. But it is likewise
true that he had actually filed an appeal, and that this was perfected. False then is his statement
that no appeal was perfected in the injunction suit. Worse, he made the statement before this
Court in order to exculpate himself, though in vain, from the charge of forum shopping.
A lawyer must be a disciple of truth. Under the Code of Professional Responsibility, he
owes candor, fairness and good faith to the courts. [37] He shall neither do any falsehood, nor
consent to the doing of any. He also has a duty not to mislead or allow the courts to be misled by
any artifice.[38]
For this offense, we suspend the respondent from the practice of law for another
year. True, in Ordonio vs. Eduarte,[39] Porac Trucking, Inc. vs. Court of Appeals [40] and Erectors,
Inc. vs. NLRC,[41] we imposed a suspension of only six months for a similar malfeasance. But in
Flores case, his falsehood is aggravated by its brazenness, for it was committed in an attempt,
vain as it was, to cover up his forum shopping.
Before we close, we note that this simple case was referred to the IBP on September 27,
1993. It was deemed submitted for resolution per the investigating commissioners order dated
May 10, 1995. However, the investigating commissioner submitted his report only on May 5,
1997. Moreover, the IBP transmitted its recommendation to the Court only through a letter dated
July 31, 1997, which was received by the Office of the Bar Confidant on August 15, 1997. Why it
took the IBP almost four years to finish its investigation of the case and over two years from the
date the parties filed their last pleadings to resolve it escapes us.After all, the case did not
require any trial-type investigation, and the parties submitted only documentary evidence to
prove or rebut their respective cases. Thus, we find it opportune to urge the IBP to hasten the
disposition of administrative cases and to remind it that this Court gives it only ninety days to
finish its investigation, report and recommendation. Should it require more time, it should file with
the Court a request for extension, giving the reason for such request.
WHEREFORE, for trifling with judicial processes by resorting to forum shopping,
Respondent Ernesto B. Flores is hereby SUSPENDED from the practice of law for a period of
ONE (1) YEAR and, for violating his oath and the Canon of Professional Responsibility to do no
falsehood, he is SUSPENDED for another period of ONE (1) YEAR, resulting in a total period of
TWO (2) YEARS, effective upon finality of this Decision. He is WARNED that a repetition of a
similar misconduct will be dealt with more severely.
Let a copy of this Decision be included in his files which are with the Office of the Bar
Confidant, and circularized to all courts and to the Integrated Bar of the Philippines.
SO ORDERED.
[G.R. No. 130068. October 1, 1998]
FAR EASTERN SHIPPING COMPANY, petitioner, vs. COURT OF APPELAS and
PHILIPPINE PORTS AUTHORITY, respondents.
[G.R. No. 130150. October 1, 1998]
MANILA PILOTS ASSOCIATION, petitioner, vs. PHILIPPINE PORTS AUTHORITY and FAR
EASTERN SHIPPING COMPANY, respondents.
DECISION
REGALADO, J.:
These consolidated petitions for review on certiorari seek in unison to annul and set aside
the decision[1] of respondent Court of Appeals of November 15, 1996 and its resolution[2] dated
July 31, 1997 in CA-G.R. CV No. 24072, entitled Philippine Ports Authority, Plaintiff-
Appellee vs. Far Eastern Shipping Company, Senen C. Gavino and Manila Pilots
Association. Defendants-Appellants, which affirmed with modification the judgment of the trial
court holding the defendants-appellants therein solidarily liable for damages in favor of herein
private respondent.
There is no dispute about the facts as found by the appellate court, thus --
x x x On June 20, 1980, the M/V PAVLODAR, flying under the flagship of the USSR, owned and
operated by the Far Eastern Shipping Company (FESC for brevitys sake), arrived at the Port of
Manila from Vancouver, British Columbia at about 7:00 oclock in the morning. The vessel was
assigned Berth 4 of the Manila International Port, as its berthing space. Captain Roberto
Abellana was tasked by the Philippine Port Authority to supervise the berthing of the
vessel. Appellant Senen Gavino was assigned by the appellant Manila Pilots Association (MPA
for brevitys sake) to conduct docking maneuvers for the safe berthing of the vessel to Berth No.
4.
Gavino boarded the vessel at the quarantine anchorage and stationed himself in the bridge, with
the master of the vessel, Victor Kavankov, beside him. After a briefing of Gavino by Kavankov of
the particulars of the vessel and its cargo, the vessel lifted anchor from the quarantine
anchorage and proceeded to the Manila International Port. The sea was calm and the wind was
ideal for docking maneuvers.
When the vessel reached the landmark (the big church by the Tondo North Harbor) one-half mile
from the pier, Gavino ordered the engine stopped. When the vessel was already about 2,000
feet from the pier, Gavino ordered the anchor dropped. Kavankov relayed the orders to the crew
of the vessel on the bow.The left anchor, with two (2) shackles were dropped. However, the
anchor did not take hold as expected.The speed of the vessel did not slacken. A commotion
ensued between the crew members. A brief conference ensued between Kavankov and the
crew members. When Gavino inquired what was all the commotion about, Kavankov assured
Gavino that there was nothing of it.
After Gavino noticed that the anchor did not take hold, he ordered the engines half-
astern. Abellana, who was then on the pier apron, noticed that the vessel was approaching the
pier fast. Kavankov likewise noticed that the anchor did not take hold. Gavino thereafter gave the
full-astern code. Before the right anchor and additional shackles could be dropped, the bow of
the vessel rammed into the apron of the pier causing considerable damage to the pier. The
vessel sustained damage too. (Exhibit 7-Far Eastern Shipping). Kavankov filed his sea protest
(Exhibit 1-Vessel). Gavino submitted his report to the Chief Pilot (Exhibit 1-Pilot) who referred
the report to the Philippine Ports Authority (Exhibit 2-Pilot) Abellana likewise submitted his report
of the incident (Exhibit B).
Per contract and supplemental contract of the Philippine Ports Authority and the contractor for
the rehabilitation of the damaged pier, the same cost the Philippine Ports Authority the amount
of P1,126,132.25 (Exhibits D and E).[3]
On January 10, 1983, the Philippine Ports Authority (PPA, for brevity), through the Solicitor
General, filed before the Regional Trial Court of Manila, Branch 39, a complaint for a sum of
money against Far Eastern Shipping Co., Capt. Senen C. Gavino and the Manila Pilots
Association, docketed as Civil Case No. 83-14958,[4] praying that the defendants therein be held
jointly and severally liable to pay the plaintiff actual and exemplary damages plus costs of suit. In
a decision dated August 1, 1985, the trial court ordered the defendants therein jointly and
severally to pay the PPA the amount of P1,053,300.00 representing actual damages and the
cost of suit.[5]
The defendants appealed to the Court of Appeals and raised the following issues: (1) Is
the pilot of a commercial vessel, under compulsory pilotage, solely liable for the damage caused
by the vessel to the pier, at the port of destination, for his negligence? And (2) Would the owner
of the vessel be liable likewise if the damage is caused by the concurrent negligence of the
master of vessel and the pilot under a compulsory pilotage?
As stated at the outset, respondent appellate court affirmed the findings of the court a
quo except that it found no employer-employee relationship existing between herein private
respondents Manila Pilots Association (MPA, for short) and Capt. Gavino. [6] This being so, it
ruled instead that the liability of MPA is anchored, not on Article 2180 of the Civil Code, but on
the provisions of Customs Administrative Order No. 15-65,[7] and accordingly modified said
decision of the trial court by holding MPA, along with its co-defendants therein, still solidarily
liable to PPA but entitled MPA to reimbursement from Capt. Gavino for such amount of the
adjudged pecuniary liability in excess of the amount equivalent to seventy-five percent (75%) of
its prescribed reserve fund.[8]
Neither Far Eastern Shipping Co. (briefly, FESC) nor MPA was happy with the decision of
the Court of Appeals and both of them elevated their respective plaints to us via separate
petitions for review on certiorari.
In G.R. No. 130068, which was assigned to the Second Division of this Court, FESC
imputed that the Court of Appeals seriously erred:
1. in not holding Senen C. Gavino and the Manila Pilots Association as the parties solely
responsible for the resulting damages sustained by the pier deliberately ignoring the established
jurisprudence on the matter.
2. in holding that the master had not exercised the required diligence demanded from him by the
circumstances at the time the incident happened;
3. in affirming the amount of damages sustained by the respondent Philippine Ports Authority
despite a strong and convincing evidence that the amount is clearly exorbitant and
unreasonable;
4. in not awarding any amount of counterclaim prayed for by the petitioner in its answer; and
5. in not granting herein petitioner's claim against pilot Senen C. Gavino and Manila Pilots'
Association in the event that it be held liable.[9]
Petitioner asserts that since the MV PAVLODAR was under compulsory pilotage at the
time of the incident, it was a compulsory pilot, Capt. Gavino, who was in command and had
complete control in the navigation and docking of the vessel. It is the pilot who supersedes the
master for the time being in the command and navigation of a ship and his orders must be
obeyed in all respects connected with her navigation. Consequently, he was solely responsible
for the damage caused upon the pier apron, and not the owners of the vessel. It claims that the
master of the boat did not commit any act of negligence when he failed to countermand or
overrule the orders of the pilot because he did not see any justifiable reason to do so. In other
words, the master cannot be faulted for relying absolutely on the competence of the compulsory
pilot. If the master does not observe that a compulsory pilot is incompetent or physically
incapacitated, the master is justified in relying on the pilot.[10]
 Respondent PPA, in its comment, predictably in full agreement with the ruling of
respondent court on the solidary liability of FESC, MPA and Capt. Gavino, stresses the
concurrent negligence of Capt. Gavino, the harbor pilot, and Capt. Viktor Kabankov, * shipmaster
of MV Pavlodar, as the basis of their solidary liability for damages sustained by PPA. It posits
that the vessel was being piloted by Capt. Gavino with Capt. Kabankov beside him all the while
on the bridge of the vessel, as the former took over the helm of MV Pavlodar when it rammed
and damaged the apron of the pier of Berth No. 4 of the Manila International Port. Their
concurrent negligence was the immediate and proximate cause of the collision between the
vessel and the pier - Capt. Gavino, for his negligence in the conduct of docking maneuvers for
the safe berthing of the vessel; and Capt. Kabankov, for failing to countermand the orders of the
harbor pilot and to take over and steer the vessel himself in the face of imminent danger, as well
as for merely relying on Capt. Gavino during the berthing procedure.[11]
On the other hand, in G.R. No. 130150, originally assigned to the Court's First Division
and later transferred to the Third Division, MPA, now as petitioner in this case, avers the
respondent court's errors consisted in disregarding and misinterpreting Customs Administrative
Order No. 15-65 which limits the liability of MPA. Said pilots' association asseverates that it
should not be held solidarily liable with Capt. Gavino who, as held by respondent court, is only a
member, not an employee, thereof. There being no employer-employee relationship, neither can
MPA be held liable for any vicarious liability for the respective exercise of profession by its
members nor be considered a joint tortfeasor as to be held jointly and severally liable. [12] It
further argues that there was erroneous reliance on Customs Administrative Order No. 15-65
and the constitution and by-laws of MPA, instead of the provisions of the Civil Code on damages
which, being a substantive law, is higher in category than the aforesaid constitution and by-laws
of a professional organization or an administrative order which bears no provision classifying the
nature of the liability of MPA for the negligence its member pilots. [13]
As for Capt. Gavino, counsel for MPA states that the former had retired from active
pilotage services since July 28, 1994 and has ceased to be a member of petitioner pilots'
association. He is not joined as a petitioner in this case since his whereabouts are unknown.[14]
FESC's comment thereto relied on the competence of the Court of Appeals in construing
provisions of law or administrative orders as basis for ascertaining the liability of MPA, and
expressed full accord with the appellate court's holding of solidary liability among itself, MPA and
Capt. Gavino. It further avers that the disputed provisions of Customs Administrative Order No.
15-65 clearly established MPA's solidary liability.[15]
On the other hand, public respondent PPA, likewise through representations by the
Solicitor General, assumes the same supportive stance it took in G.R. No. 130068 in declaring
its total accord with the ruling of the Court of Appeals that MPA is solidarily liable with Capt.
Gavino and FESC for damages, and in its application to the fullest extent of the provisions of
Customs Administrative Order No. 15-65 in relation to MPA's constitution and by-laws which
spell out the conditions of and govern their respective liabilities.These provisions are clear and
ambiguous as regards MPA's liability without need for interpretation or construction. Although
Customs Administrative Order No. 15-65 is a mere regulation issued by an administrative
agency pursuant to delegated legislative authority to fix details to implement the law, it is legally
binding and has the same statutory force as any valid statute.[16]
Upon motion[17] by FESC dated April 24, 1998 in G.R. No. 130150, said case was
consolidated with G.R. No. 130068.[18]
Prefatorily, on matters of compliance with procedural requirements, it must be mentioned
that the conduct of the respective counsel for FESC and PPA leaves much to be desired, to the
displeasure and disappointment of this Court.
Section 2, Rule 42 of the 1997 Rules of Civil Procedure[19] incorporates the former Circular
No. 28-91 which provided for what has come to be known as the certification against forum
shopping as an additional requisite for petitions filed with the Supreme Court and the Court of
Appeals, aside from the other requirements contained in pertinent provisions of the Rules of
Court therefor, with the end in view of preventing the filing of multiple complaints involving the
same issues in the Supreme Court, Court of Appeals or different divisions thereof or any other
tribunal or agency.
More particularly, the second paragraph of Section 2, Rule 42 provides:
xxxxxxxxx
The petitioner shall also submit together with the petition a certification under oath that he has
not therefore commenced any other action involving the same issues in the Supreme Court, the
Court of Appeals or different divisions thereof, or any other tribunal or agency; if there is such
other action or proceeding, he must state the status of the same; and if he should thereafter
learn that a similar action or proceeding has been filed or is pending before the Supreme Court,
the Court of Appeals or different divisions thereof, or any other tribunal or agency, he undertakes
to promptly inform the aforesaid courts and other tribunal or agency thereof within five (5) days
therefrom. (Italics supplied.)
For petitions for review filed before the Supreme Court, Section 4(e), Rule 45 specifically
requires that such petition shall contain a sworn certification against forum shopping as provided
in the last paragraph of Section 2, Rule 42.
The records show that the law firm of Del Rosario and Del Rosario through its associate,
Atty. Herbert A. Tria, is the counsel of record for FESC in both G.R. No. 130068 and G.R. No.
130150.
G.R. No. 130068, which is assigned to the Court's Second Division, commenced with the
filing by FESC through counsel on August 22, 1997 of a verified motion for extension of time to
file its petition for thirty (30) days from August 28, 1997 or until September 27, 1997.[20] Said
motion contained the following certification against forum shopping[21] signed by Atty. Herbert A.
Tria as affiant:
CERTIFICATION
AGAINST FORUM SHOPPING
I/we hereby certify that I/we have not commenced any other action or proceeding involving the
same issues in the Supreme Court, the Court of Appeals, or any other tribunal or agency; that to
the best of my own knowledge, no such action or proceeding is pending in the Supreme Court,
the Court of Appeals, or any other tribunal or agency; that if I/we should thereafter learn that a
similar action or proceeding has been filed or is pending before the Supreme Court, the Court of
Appeals, or any other tribunal or agency, I/we undertake to report that fact within five (5) days
therefrom to this Honorable Court.
This motion having been granted, FESC subsequently filed its petition on September 26, 1997,
this time bearing a "verification and certification against forum-shopping" executed by one
Teodoro P. Lopez on September 24, 1997,[22] to wit:
VERIFICATION AND CERTIFICATION
AGAINST FORUM SHOPPING
in compliance with Section 4(e), Rule 45 in relation to Section 2, Rule 42 of the Revised Rules of
Civil Procedure
I, Teodoro P. Lopez, of legal age, after being duly sworn, depose and state:
1. That I am the Manager, Claims Department of Filsov Shipping Company, the local agent of
petitioner in this case.
2. That I have caused the preparation of this Petition for Review on Certiorari.
3. That I have read the same and the allegations therein contained are true and correct based
on the records of this case.
4. That I certify that petitioner has not commenced any other action or proceeding involving the
same issues in the Supreme Court or Court of Appeals, or any other tribunal or agency, that to
the best of my own knowledge, no such action or proceeding is pending in the Supreme Court,
the Court of Appeals or any other tribunal or agency, that I should thereafter learn that a similar
action or proceeding has been filed or is pending before the Supreme Court, the Court of
Appeals, or any other tribunal or agency, I undertake to report the fact within five (5) days
therefrom to this Honorable Court. (Italics supplied for emphasis.)
Reviewing the records, we find that the petition filed by MPA in G.R. No. 130150 then
pending with the Third Division was duly filed on August 29, 1997 with a copy thereof furnished
on the same date by registered mail to counsel for FESC.[23] Counsel of record for MPA, Atty.
Jesus P. Amparo, in his verification accompanying said petition dutifully revealed to the Court
that--
xxxxxxxxx
3. Petitioner has not commenced any other action or proceeding involving the same issues in his
Honorable Court, the Court of Appeals or different Divisions thereof, or any other tribunal or
agency, but to the best of his knowledge, there is an action or proceeding pending in this
Honorable Court, entitled Far Eastern Shipping Co., Petitioner, vs. Philippine Ports Authority and
Court of Appeals with a Motion for Extension of time to file Petition for Review by Certiorari filed
sometime on August 18, 1997. If undersigned counsel will come to know of any other pending
action or claim filed or pending he undertakes to report such fact within five (5) days to this
Honorable Court.[24] (Italics supplied.)
Inasmuch as MPA's petition in G.R. No. 130150 was posted by registered mail on August
29, 1997 and taking judicial notice of the average period of time it takes local mail to reach its
destination, by reasonable estimation it would be fair to conclude that when FESC filed its
petition in G.R. No. 130068 on September 26, 1997, it would already have received a copy of
the former and would then have knowledge of the pendency of the other petition initially filed
with the First Division. It was therefore incumbent upon FESC to inform the Court of that fact
through its certification against forum shopping. For failure to make such disclosure, it would
appear that the aforequoted certification accompanying the petition in G.R. No. 130068 is
defective and could have been a ground for dismissal thereof.
Even assuming that FESC has not yet received its copy of MPA's petition at the time it
filed its own petition and executed said certification, its signatory did state "that if I should
thereafter learn that a similar action or proceeding has been filed or is pending before the
Supreme Court, the Court of Appeals or any other tribunal or agency, I undertake to report the
fact within five (5) days therefrom in this Honorable Court."[25] Scouring the records page by page
in this case, we find that no manifestation concordant with such undertaking was then or at any
other time thereafter ever filed by FESC nor was there any attempt to bring such matter to the
attention of the Court. Moreover, it cannot feign non-knowledge of the existence of such other
petition because FESC itself filed the motion for consolidation in G.R. No. 130150 of these two
cases on April 24, 1998.
It is disturbing to note that counsel for FESC, the law firm of Del Rosario and Del Rosario,
displays an unprofessional tendency of taking the Rules for granted, in this instance exemplified
by its pro formacompliance therewith but apparently without full comprehension of and with less
than faithful commitment to its undertakings to this Court in the interest of just, speedy and
orderly administration of court proceedings.
As between the lawyer and the courts, a lawyer owes candor, fairness and good faith to
the court.[26]He is an officer of the court exercising a privilege which is indispensable in the
administration of justice.[27]Candidness, especially towards the courts, is essential for the
expeditious administration of justice. Courts are entitled to expect only complete honesty from
lawyers appearing and pleading before them.[28] Candor in all dealings is the very essence of
honorable membership in the legal profession.[29] More specifically, a lawyer is obliged to
observe the rules of procedure and not to misuse them to defeat the ends of justice. [30]It
behooves a lawyer, therefore, to exert every effort and consider it his duty to assist in the speedy
and efficient administration of justice.[31] Being an officer of the court, a lawyer has a
responsibility in the proper administration of justice. Like the court itself, he is an instrument to
advance its ends -- the speedy, efficient, impartial, correct and inexpensive adjudication of cases
and the prompt satisfaction of final judgments. A lawyer should not only help attain these
objectives but should likewise avoid any unethical or improper practices that impede, obstruct or
prevent their realization, charged as he is with the primary task of assisting in the speedy and
efficient administration of justice.[32]
Sad to say, the members of said law firm sorely failed to observe their duties as
responsible members of the Bar. Their actuations are indicative of their predisposition to take
lightly the avowed duties of officers of the Court to promote respect for law and for legal
processes.[33] We cannot allow this state of things to pass judicial muster.
In view of the fact that at around the time these petitions were commenced, the 1997
Rules of Civil Procedure had just taken effect, the Court treated infractions of the new Rules
then with relative liberality in evaluating full compliance therewith. Nevertheless, it would do well
to remind all concerned that the penal provisions of Circular No. 28-91 which remain operative
provides, inter alia:
3. Penalties.-
xxxxxxxxx
(c) The submission of a false certification under Par. 2 of the Circular shall likewise constitute
contempt of court, without prejudice to the filing of criminal action against the guilty party. The
lawyer may also be subjected to disciplinary proceedings.
It must be stressed that the certification against forum shopping ordained under the Rules
is to be executed by the petitioner, and not by counsel. Obviously it is the petitioner, and not
always the counsel whose professional services have been retained for a particular case, who is
in the best position to know whether he or it actually filed or caused the filing of a petition in that
case. Hence, a certification against forum shopping by counsel is a defective certification. It is
clearly equivalent to non-compliance with the requirement under Section 2, Rule 42 in relation to
Section 4, Rule 45, and constitutes a valid cause for dismissal of the petition.
Hence, the initial certification appended to the motion for extension of time to file petition n
G.R. No. 130068 executed in behalf of FESC by Atty. Tria is procedurally deficient. But
considering that it was a superfluity at that stage of the proceeding, it being unnecessary to file
such a certification with a mere motion for extension, we shall disregard such error. Besides, the
certification subsequently executed by Teodoro P. Lopez in behalf of FESC cures that defect to
a certain extent, despite the inaccuracies earlier pointed out. In the same vein, we shall consider
the verification signed in behalf of MPA by its counsel, Atty. Amparo, in G.R. No. 130150 as
substantial compliance inasmuch as it served the purpose of the Rules of informing the Court of
the pendency of another action or proceeding involving the same issues.
It bears stressing that procedural rules are instruments in the speedy and efficient
administration of justice. They should be used to achieve such end and not to derail it.[34]
Counsel for PPA did not make matters any better. Despite the fact that, save for the
Solicitor General at the time, the same legal team of the Office of the Solicitor General (OSG, for
short) composed of Assistant Solicitor General Roman G. Del Rosario and Solicitor Luis F.
Simon, with the addition of Assistant Solicitor General Pio C. Guerrero very much later in the
proceedings, represented PPA throughout the appellate proceedings in both G.R. No. 130068
and G.R. No. 130150 and was presumably fully acquainted with the facts and issues of the case,
it took the OSG an inordinately and almost unreasonably long period of time to file its comment,
thus unduly delaying the resolution of these cases. It took several changes of leadership in the
OSG -- from Silvestre H. Bello III to Romeo C. dela Cruz and, finally, Ricardo P. Galvez -- before
the comment in behalf of PPA was finally filed.
In G.R. No. 130068, it took eight (8) motions for extension of time totaling 210 days, a
warning that no further extensions shall be granted, and personal service on the Solicitor
General himself of the resolution requiring the filing of such comment before the OSG indulged
the Court with the long required comment on July 10, 1998. [35] This, despite the fact that said
office was required to file its comment way back on November 12, 1997. [36] A closer scrutiny of
the records likewise indicates that petitioner FESC was not even furnished a copy of said
comment as required by Section 5, Rule 42. Instead, a copy thereof was inadvertently furnished
to MPA which, from the point of view of G.R. No. 130068, was a non-party.[37] The OSG fared
slightly better in G.R. No. 130150 in that it took only six (6) extensions, or a total of 180 days,
before the comment was finally filed.[38] And while it properly furnished petitioner MPA with a
copy of its comment, it would have been more desirable and expedient in this case to have
furnished its therein co-respondent FESC with a copy thereof, if only as a matter of professional
courtesy.[39]
This undeniably dilatory disinclination of the OSG to seasonably file required pleadings
constitutes deplorable disservice to the tax-paying public and can only be categorized as
censurable inefficiency on the part of the government law office. This is most certainly
professionally unbecoming of the OSG.
Another thing that baffles the Court is why the OSG did not take the initiative of filing a
motion for consolidation in either G.R. No. 130068 or G.R. No. 130150, considering its familiarity
with the background of the case and if only to make its job easier by having to prepare and file
only one comment. It could not have been unaware of the pendency of one or the other petition
because, being counsel for respondent in both cases, petitioner is required to furnish it with a
copy of the petition under pain of dismissal of the petition for failure otherwise. [40]
Besides, in G.R. 130068, it prefaces its discussions thus --
Incidentally, the Manila Pilots' Association (MPA), one of the defendants-appellants in the case
before the respondent Court of Appeals, has taken a separate appeal from the said decision to
this Honorable Court, which was docketed as G.R. No. 130150 and entitled "Manila Pilots'
Association, Petitioner, versus Philippine Ports Authority and Far Eastern Shipping Co.,
Respondents.[41]
Similarly, in G.R. No. 130150, it states -
Incidentally, respondent Far Eastern Shipping Co. (FESC) had also taken an appeal from the
said decision to this Honorable Court, docketed as G.R. No. 130068, entitled "Far Eastern
Shipping Co. vs. Court of Appeals and Philippine Ports Authority."[42]
We find here a lackadaisical attitude and complacency on the part of the OSG in the
handling of its cases and an almost reflexive propensity to move for countless extensions, as if
to test the patience of the Court, before favoring it with the timely submission of required
pleadings.
It must be emphasized that the Court can resolve cases only as fast as the respective
parties in a case file the necessary pleadings. The OSG, be needlessly extending the pendency
of these cases through its numerous motions for extension, came very close to exhausting this
Court's forbearance and has regrettably fallen short of its duties as the People's Tribune.
The OSG is reminded that just like other members of the Bar, the canons under the Code
of Professional Responsibility apply with equal force on lawyers in government service in the
discharge of their official tasks.[43] These ethical duties are rendered even more exacting as to
them because, as government counsel, they have the added duty to abide by the policy of the
State to promote a high standard of ethics in public service. [44] Furthermore, it is incumbent upon
the OSG, as part of the government bureaucracy, to perform and discharge its duties with the
highest degree of professionalism, intelligence and skill[45] and to extend prompt, courteous and
adequate service to the public.[46]
Now, on the merits of the case. After a judicious examination of the records of this case,
the pleadings filed, and the evidence presented by the parties in the two petitions, we find no
cogent reason to reverse and set aside the questioned decision. While not entirely a case of first
impression, we shall discuss the issues seriatim and, correlatively by way of a judicial once-over,
inasmuch as the matters raised in both petitions beg for validation and updating of well worn
maritime jurisprudence. Thereby, we shall write finisto the endless finger-pointing in this
shipping mishap which has been stretched beyond the limits of judicial tolerance.
The Port of Manila is within the Manila Pilotage District which is under compulsory pilotage
pursuant to Section 8, Article III of Philippine Ports Authority Administrative Order No. 03-
85,[47] which provides that:
SEC. 8. Compulsory Pilotage Service.- For entering a harbor and anchoring thereat, or passing
through rivers or straits within a pilotage district, as well as docking and undocking at any
pier/wharf, or shifting from one berth or another, every vessel engaged in coastwise and foreign
trade shall be under compulsory pilotage. x x x
In case of compulsory pilotage, the respective duties and responsibilities of the
compulsory pilot and the master have been specified by the same regulation in this wise:
SEC. 11. Control of vessels and liability for damage. - On compulsory pilotage grounds, the
Harbor Pilot, providing the service to a vessel shall be responsible for the damage caused to a
vessel or to life and property at ports due to his negligence or fault. He can only be absolved
from liability if the accident is caused by force majeure or natural calamities provided he has
exercised prudence and extra diligence to prevent or minimize damage.
The Master shall retain overall command of the vessel even on pilotage grounds whereby he
can countermand or overrule the order or command of the Harbor Pilot on board. In such event,
any damage caused to a vessel or to life and property at ports by reason of the fault or
negligence of the Master shall be the responsibility and liability of the registered owner of the
vessel concerned without prejudice to recourse against said Master.
Such liability of the owner or Master of the vessel or its pilots shall be determined by competent
authority in appropriate proceedings in the light of the facts and circumstances of each particular
case.
SEC. 32. Duties and responsibilities of the Pilot or Pilots' Association. - The duties and
responsibilities of the Harbor Pilot shall be as follows:
xxxxxxxxx
f) a pilot shall be held responsible for the direction of a vessel from the time he assumes his
work as a pilot thereof until he leaves it anchored or berthed safely; Provided, however, that his
responsibility shall cease at the moment the Master neglects or refuses to carry out his order.
 Customs Administrative Order No. 15-65 issued twenty years earlier likewise provided in
Chapter I thereof for the responsibilities of pilots:
Par. XXXIX. - A Pilot shall be held responsible for the direction of a vessel from the time he
assumes control thereof until he leaves it anchored free from shoal; Provided, That his
responsibility shall cease at the moment the master neglects or refuses to carry out his
instructions.
xxxxxxxxx
Par. XLIV. - Pilots shall properly and safely secure or anchor vessels under their control when
requested to do so by the master of such vessels.
I. G.R. No. 130068
Petitioner FESC faults the respondent court with serious error in not holding MPA and
Capt. Gavino solely responsible for the damages caused to the pier. It avers that since the
vessel was under compulsory pilotage at the time with Capt. Gavino in command and having
exclusive control of the vessel during the docking maneuvers, then the latter should be
responsible for damages caused to the pier.[48] It likewise holds the appellate court in error for
holding that the master of the ship, Capt. Kabankov, did not exercise the required diligence
demanded by the circumstances.[49]
We start our discussion of the successive issues bearing in mind the evidentiary rule in
American jurisprudence that there is a presumption of fault against a moving vessel that strikes
a stationary object such as a dock or navigational aid. In admiralty, this presumption does more
than merely require the ship to go forward and produce some evidence on the presumptive
matter. The moving vessel must show that it was without fault or that the collision was
occasioned by the fault of the stationary object or was the result of inevitable accident. It has
been held that such vessel must exhaust every reasonable possibility which the circumstances
admit and show that in each, they did all that reasonable care required. [50] In the absence of
sufficient proof in rebuttal, the presumption of fault attaches to a moving vessel which collides
with a fixed object and makes a prima facie case of fault against the vessel.[51] Logic and
experience support this presumption:
The common sense behind the rule makes the burden a heavy one. Such accidents simply do
not occur in the ordinary course of things unless the vessel has been mismanaged in some
way. It is not sufficient for the respondent to produce witnesses who testify that as soon as the
danger became apparent everythingpossible was done to avoid an accident. The question
remains, How then did the collision occur? The answer must be either that, in spite of the
testimony of the witnesses, what was done was too little or too late or, if not, then the vessel was
at fault for being in a position in which an unavoidable collision would occur.[52]
The task, therefore, in these cases is to pinpoint who was negligent - the master of the ship, the
harbor pilot or both.
A pilot, in maritime law, is a person duly qualified, and licensed, to conduct a vessel into or
out of ports, or in certain waters. In a broad sense, the term "pilot" includes both (1) those whose
duty it is to guide vessels into or out of ports, or in particular waters and (2) those entrusted with
the navigation of vessels on the high seas.[53] However, the term "pilot" is more generally
understood as a person taken on board at a particular place for the purpose of conducting a ship
through a river, road or channel, or from a port.[54]
Under English and American authorities, generally speaking, the pilot supersedes the
master for the time being in the command and navigation of the ship, and his orders must be
obeyed in all matters connected with her navigation. He becomes the master pro hac vice and
should give all directions as to speed, course, stopping and reversing, anchoring, towing and the
like. And when a licensed pilot is employed in a place where pilotage is compulsory, it is his duty
to insist on having effective control of the vessel, or to decline to act as pilot. Under certain
systems of foreign law, the pilot does not take entire charge of the vessel, but is deemed merely
the adviser of the master, who retains command and control of the navigation even on localities
where pilotage is compulsory.[55]
It is quite common for states and localities to provide for compulsory pilotage, and safety
laws have been enacted requiring vessels approaching their ports, with certain exceptions, to
take on board pilots duly licensed under local law. The purpose of these laws is to create a body
of seamen thoroughly acquainted with the harbor, to pilot vessels seeking to enter or depart, and
thus protect life and property from the dangers of navigation.[56]
In line with such established doctrines, Chapter II of Customs Administrative Order No.
15-65 prescribes the rules of compulsory pilotage in the covered pilotage districts, among which
is the Manila Pilotage District, viz. --
PARAGRAPH I. - Pilotage for entering a harbor and anchoring thereat, as well as docking
and undocking in any pier or shifting from one berth to another shall be compulsory, except
Government vessels and vessels of foreign governments entitled to courtesy, and other vessels
engaged solely in river or harbor work, or in a daily ferry service between ports which shall be
exempt from compulsory pilotage provisions of these regulations: provided, however, that
compulsory pilotage shall not apply in pilotage districts whose optional pilotage is allowed under
these regulations.
Pursuant thereto, Capt. Gavino was assigned to pilot MV Pavlodar into Berth 4 of the
Manila International Port. Upon assuming such office as compulsory pilot, Capt. Gavino is held
to the universally accepted high standards of care and diligence required of a pilot, whereby he
assumes to have skill and knowledge in respect to navigation in the particular waters over which
his license extends superior to and more to be trusted than that of the master. [57] A pilot should
have a thorough knowledge of general and local regulations and physical conditions affecting
the vessel in his charge and the waters for which he is licensed, such as a particular harbor or
river. He is not held to the highest possible degree of skill and care, but must have and exercise
the ordinary skill and care demanded by the circumstances, and usually shown by an expert in
his profession. Under extraordinary circumstances, a pilot must exercise extraordinary care. [58]
In Atlee vs. The Northwestern Union Packet Company,[59] Mr. Justice Miller spelled out in
great detail the duties of a pilot:
x x x (T)he pilot of a river steamer, like the harbor pilot, is selected for his personal
knowledge of the topography through which he steers his vessel. In the long course of a
thousand miles in one of these rivers, he must be familiar with the appearance of the shore on
each side of the river as he goes along. Its banks, towns, its landings, its houses and trees, are
all landmarks by which he steers his vessel. The compass is of little use to him. He must know
where the navigable channel is, in its relation to all these external objects, especially in the
night. He must also be familiar with all dangers that are permanently located in the course of the
river, as sand-bars, snags, sunken rocks or trees or abandoned vessels or barges. All this he
must know and remember and avoid. To do this, he must be constantly informed of the changes
in the current of the river, of the sand-bars newly made, of logs or snags, or other objects newly
presented, against which his vessel might be injured.
xxxxxxxxx
It may be said that this is exacting a very high order of ability in a pilot. But when we
consider the value of the lives and property committed to their control, for in this they are
absolute masters, the high compensation they receive, the care which Congress has taken to
secure by rigid and frequent examinations and renewal of licenses, this very class of skill, we do
not think we fix the standard too high.
Tested thereby, we affirm respondent court's finding that Capt. Gavino failed to measure
up to such strict standard of care and diligence required of pilots in the performance of their
duties. Witness this testimony of Capt. Gavino:
Court:
You have testified before that the reason why the vessel bumped the pier was
because the anchor was not released immediately or as soon as you have given the
order. Do you remember having stated that?
A Yes, your Honor.
Q And you gave this order to the captain of the vessel?
A Yes, your Honor.
Q By that testimony, you are leading the Court to understand that is that anchor was
released immediately at the time you gave the order, the incident would not have
happened. Is that correct?
A Yes, sir, but actually it was only a presumption on my part because there was a
commotion between the officers who are in charge of the dropping of the anchor and
the captain. I could not understand their language, it was in Russian, so I presumed
the anchor was not dropped on time.
Q So, you are not sure whether it was really dropped on time or not?
A I am not sure, your Honor.
xxxxxxxxx
Q You are not even sure what could have caused the incident. What factor could have
caused the incident?
A Well, in this case now, because either the anchor was not dropped on time or the anchor
did not hold, that was the cause of the incident, your Honor.[60]
It is disconcertingly riddled with too much incertitude and manifests a seeming indifference
for the possibly injurious consequences his commands as pilot may have. Prudence required
that he, as pilot, should have made sure that his directions were promptly and strictly
followed. As correctly noted by the trial court -
Moreover, assuming that he did indeed give the command to drop the anchor on time, as
pilot he should have seen to it that the order was carried out, and he could have done this in a
number of ways, one of which was to inspect the bow of the vessel where the anchor
mechanism was installed. Of course, Captain Gavino makes reference to a commotion among
the crew members which supposedly caused the delay in the execution of the command. This
account was reflected in the pilot's report prepared four hours later, but Capt. Kavankov, while
not admitting whether or not such a commotion occurred, maintained that the command to drop
anchor was followed "immediately and precisely." Hence, the Court cannot give much weight or
consideration to this portion of Gavino's testimony."[61]
An act may be negligent if it is done without the competence that a reasonable person in
the position of the actor would recognize as necessary to prevent it from creating an
unreasonable risk of harm to another.[62] Those who undertake any work calling for special skills
are required not only to exercise reasonable care in what they do but also possess a standard
minimum of special knowledge and ability.[63]
Every man who offers his services to another, and is employed, assumes to exercise in
the employment such skills he possesses, with a reasonable degree of diligence. In all these
employments where peculiar skill is requisite, if one offers his services he is understood as
holding himself out to the public as possessing the degree of skill commonly possessed by
others in the same employment, and if his pretensions are unfounded he commits a species of
fraud on every man who employs him in reliance on his public profession.[64]
Furthermore, there is an obligation on all persons to take the care which, under ordinary
circumstances of the case, a reasonable and prudent man would take, and the omission of that
care constitutes negligence.[65] Generally, the degree of care required is graduated according to
the danger a person or property attendant upon the activity which the actor pursues or the
instrumentality which he uses. The greater the danger the greater the degree of care
required. What is ordinary under extraordinary of conditions is dictated by those conditions;
extraordinary risk demands extraordinary care. Similarly, the more imminent the danger, the
higher the degree of care.[66]
We give our imprimatur to the bases for the conclusion of the Court of Appeals that Capt.
Gavino was indeed negligent in the performance of his duties:
xxxxxxxxx
x x x As can be gleaned from the logbook, Gavino ordered the left anchor and two (2)
shackles dropped at 8:30 o'clock in the morning. He ordered the engines of the vessel stopped
at 8:31 o'clock. By then, Gavino must have realized that the anchor did not hit a hard object and
was not clawed so as to reduce the momentum of the vessel. In point of fact, the vessel
continued travelling towards the pier at the same speed. Gavino failed to react. At 8:32 o'clock,
the two (2) tugboats began to push the stern part of the vessel from the port side but the
momentum of the vessel was not contained. Still, Gavino did not react. He did not even order the
other anchor and two (2) more shackles dropped to arrest the momentum of the vessel. Neither
did he order full-astern. It was only at 8:34 o'clock, or four (4) minutes, after the anchor was
dropped that Gavino reacted. But his reaction was even (haphazard) because instead of
arresting fully the momentum of the vessel with the help of the tugboats, Gavino ordered merely
"half-astern". It took Gavino another minute to order a "full-astern". By then, it was too late. The
vessel's momentum could no longer be arrested and, barely a minute thereafter, the bow of the
vessel hit the apron of the pier. Patently, Gavino miscalculated. He failed to react and undertake
adequate measures to arrest fully the momentum of the vessel after the anchor failed to claw to
the seabed. When he reacted, the same was even (haphazard). Gavino failed to reckon the bulk
of the vessel, its size and its cargo. He erroneously believed that only one (1) anchor would
suffice and even when the anchor failed to claw into the seabed or against a hard object in the
seabed, Gavino failed to order the other anchor dropped immediately. His claim that the anchor
was dropped when the vessel was only 1,000 feet from the pier is but a belated attempt to
extricate himself from the quagmire of his own insouciance and negligence. In sum, then,
Appellants' claim that the incident was caused by "force majeure" is barren of factual basis.
xxxxxxxxx
The harbor pilots are especially trained for this job. In the Philippines, one may not be a
harbor pilot unless he passed the required examination and training conducted then by the
Bureau of Custom, under Customs Administrative Order No. 15-65, now under the Philippine
Ports Authority under PPA Administrative Order 63-85. Paragraph XXXIX of the Customs
Administrative Order No. 15-65 provides that "the pilot shall be held responsible for the direction
of the vessel from the time he assumes control thereof, until he leaves it anchored free from
shoal: Provided, that his responsibility shall cease at the moment the master neglects or
refuse(s) to carry out his instructions." The overall direction regarding the procedure for docking
and undocking the vessel emanates from the harbor pilot. In the present recourse, Gavino failed
to live up to his responsibilities and exercise reasonable care or that degree of care required by
the exigencies of the occasion. Failure on his part to exercise the degree of care demanded by
the circumstances is negligence (Reese versus Philadelphia & RR Co. 239 US 463, 60 L ed.
384, 57 Am Jur. 2d 12age 418).[67]
This affirms the findings of the trial court regarding Capt. Gavino's negligence:
This discussion should not however, divert the court from the fact that negligence in
manuevering the vessel must be attributed to Capt. Senen Gavino. He was an experienced pilot
and by this time should have long familiarized himself with the depth of the port and the distance
he could keep between the vessel and port in order to berth safely. [68]
The negligence on the part of Capt. Gavino is evident; but Capt. Kabankov is no less
responsible for the allision. His unconcerned lethargy as master of the ship in the face of
troublous exigence constitutes negligence.
While it is indubitable that in exercising his functions a pilot-is in sole command of the
ship[69] and supersedes the master for the time being in the command and navigation of a ship
and that he becomes master pro hac vice of a vessel piloted by him,[70] there is overwhelming
authority to the effect that the master does not surrender his vessel to the pilot and the pilot is
not the master. The master is still in command of the vessel notwithstanding the presence of a
pilot. There are occasions when the master may and should interfere and even displace the
pilot, as when the pilot is obviously incompetent or intoxicated and the circumstances may
require the master to displace a compulsory pilot because of incompetency or physical
incapacity. If, however, the master does not observe that a compulsory pilot is incompetent or
physically incapacitated, the master is justified in relying on the pilot, but not blindly. [71]
The master is not wholly absolved from his duties while a pilot is on board his vessel, and
may advise with or offer suggestions to him. He is still in command of the vessel, except so far
as her navigation is concerned, and must cause the ordinary work of the vessel to be properly
carried on and the usual precaution taken. Thus, in particular, he is bound to see that there is
sufficient watch on deck, and that the men are attentive to their duties, also that engines are
stopped, towlines cast off, and the anchors clear and ready to go at the pilot's order.[72]
A perusal of Capt. Kabankov's testimony makes it apparent that he was remiss in the
discharge of his duties as master of the ship, leaving the entire docking procedure up to the pilot,
instead of maintaining watchful vigilance over this risky maneuver:
Q Will you please tell us whether you have the right to intervene in docking of your ship in
the harbor?
A No sir, I have no right to intervene in time of docking, only in case there is imminent
danger to the vessel and to the pier.
Q Did you ever intervene during the time that your ship was being docked by Capt. Gavino?
A No sir, I did not intervene at the time when the pilot was docking my ship.
Q Up to the time it was actually docked at the pier, is that correct'?
A No sir, I did not intervene up to the very moment when the vessel was docked.
xxxxxxxxx
Atty. Del Rosario (to the witness)
Q Mr. Witness, what happened, if any, or was there anything unusual that happened during
the docking?
A Yes sir, our ship touched the pier and the pier was damaged.
Court (to the witness)
Q When you said touched the pier, are you leading the court to understand that your ship
bumped the pier?
A I believe that my vessel only touched the pier but the impact was very weak.
Q Do you know whether the pier was damaged as a result of that slight or weak impact?
A Yes sir, after the pier was damaged.
xxxxxxxxx
Q Being most concerned with the safety of your vessel, in the maneuvering of your vessel,
to the port, did you observe anything irregular in the maneuvering by Capt. Gavino at
the time he was trying to cause the vessel to be docked at the pier?
A You mean the action of Capt. Gavino or his condition?
Court:
Q Not the actuation that conform to the safety maneuver of the ship to the harbor?
A No sir, it was a usual docking.
Q By that statement of yours, you are leading the court to understand that there was nothing
irregular in the docking of the ship?
A Yes sir, during the initial period, of the docking, there was nothing unusual that happened.
Q What about in the last portion of the docking of the ship, was there anything unusual or
abnormal that happened?
A None Your Honor, I believe that Capt. Gavino thought that the anchor could keep or hold
the vessel.
Q You want us to understand, Mr. Witness, that the dropping of the anchor of the vessel was
not timely?
A I don't know the depth of this port but I think, if the anchor was dropped earlier and with
more shackles, there could not have been an incident.
Q So you could not precisely tell the court that the dropping of the anchor was timely
because you are not well aware of the seabed, is that correct?
A Yes sir, that, is right.
xxxxxxxxx
Q Alright, Capt. Kavankov, did you come to know later whether the anchor held its ground so
much so that the vessel could not travel?
A It is difficult for me to say definitely. I believe that the anchor did not hold the ship.
Q You mean you don't know whether the anchor blades stuck to the ground to stop the ship
from further moving?
A Yes sir, it is possible.
Q What is possible?
A I think, the 2 shackles were not enough to hold the vessel.
Q Did you know that the 2 shackles were dropped? A No sir, I did not observe.

A Yes sir, I knew that. Q By that answer, are you leading the court to understand that because you did not
intervene and because you believed that it was your duty to intervene when the vessel
Q If you knew that the shackles were not enough to hold the ship, did you not make any is placed in imminent danger to which you did not observe any imminent
protest to the pilot? danger thereof, you have not intervened in any manner to the command of the pilot?
A No sir, after the incident, that was my assumption. A That is right, sir.
Q Did you come to know later whether that presumption is correct? xxxxxxxxx
A I still don't know the ground in the harbor or the depths. Q Assuming that you disagreed with the pilot regarding the step being taken by the pilot in
maneuvering the vessel. whose command will prevail, in case of imminent danger to
Q So from the beginning, you were not competent whether the 2 shackles were also the vessel?
dropped to hold the ship?
A I did not consider the situation as having an imminent danger. I believed that the vessel
A No sir, at the beginning, I did not doubt it because I believe Capt. Gavino to be an will dock alongside the pier.
experienced pilot and he should be more aware as to the depths of the harbor and the
ground and I was confident in his actions. Q You want us to understand that you did not see an imminent danger to your ship, is that
what you mean?
xxxxxxxxx
A Yes sir, up to the very last moment, I believed that there was no imminent danger.
Solicitor Abad (to the witness)
Q Because of that, did you ever intervene in the command of the pilot?
Q Now, you were standing with the pilot on the bridge of the vessel before the incident
happened, were you not? A Yes sir, I did not intervene because I believed that the command of the pilot to be correct.
A Yes sir, all the time, I was standing with the pilot. Solicitor Abad (to the witness)
Q And so whatever the pilot saw, you could also see from that point of view? Q As a captain of M/V Pavlodar, you consider docking maneuvers a serious matter, is it not?
A That is right. A Yes sir, that is right.
Q Whatever the pilot can read from the panel of the bridge, you also could read, is that Q Since it affects not only the safety of the port or pier, but also the safety of the vessel and
correct? the cargo, is it not?
A What is the meaning of panel'? A That is right.
Q All indications necessary for men on the bridge to be informed of the movements of the Q So that, I assume that you were watching Capt. Gavino very closely at the time he was
ship? making his commands?
A That is right. A I was close to him, I was hearing his command and being executed.
Q And whatever sound the captain... Capt. Gavino would hear from the bridge, you could Q And that you were also alert for any possible mistakes he might commit in the
also hear? maneuvering of the vessel?
A That is right. A Yes sir, that is right.
Q Now, you said that when the command to lower the anchor was given, it was obeyed, is Q But at no time during the maneuver did you issue order contrary to the orders
that right? Capt. Gavino made?
A This command was executed by the third mate and boatswain. A No sir.
Court (to the witness) Q So that you were in full accord with all of Capt. Gavino's orders?
Q Mr. Witness, earlier in today's hearing, you said that you did not intervene with the duties A Yes sir.
of the pilot and that, in your opinion, you can only intervene if the ship is placed in
imminent danger, is that correct? Q Because, otherwise, you would have issued order that would supersede his own order?

A That is right, I did say that. A In that case, I should take him away from his command or remove the command from him.

Q In your observation before the incident actually happened, did you observe whether or not Court (to the witness)
the ship, before the actual incident, the ship was placed in imminent danger?.
Q You were in full accord with the steps being taken by Capt. Gavino because you relied on
his knowledge, on his familiarity of the seabed and shoals and other surroundings or
conditions under the sea, is that correct?
A Yes sir, that is right.
xxxxxxxxx
Solicitor Abad (to the witness)
Q And so after the anchors were ordered dropped and they did not take hold of the seabed,
you were alerted that there was danger already on hand?
A No sir, there was no imminent danger to the vessel.
Q Do you mean to tell us that even if the anchor was supposed to take hold of the bottom
and it did not, there was no danger to the ship?
A Yes sir, because the anchor dragged on the ground later.
Q And after a few moments when the anchor should have taken hold the seabed but not
done (sic), as you expected, you already were alerted that there was danger to the
ship, is that correct?
A Yes sir, I was alerted but there was no danger.
Q And you were alerted that somebody was wrong?
A Yes sir, I was alerted.
Q And this alert you assumed was the ordinary alertness that you have for normal docking?
A Yes sir, I mean that it was usual condition of any man in time of docking to be alert.
Q And that is the same alertness when the anchor did not hold onto the ground, is that
correct?
A Yes sir, me and Capt. Gavino (thought) that the anchor will hold the ground.
Q Since, as you said that you agreed all the while with the orders of Capt. Gavino, you also
therefore agreed with him in his failure to take necessary precaution against the
eventuality that the anchor will not hold as expected?
Atty. Del Rosario:
May I ask that the question ...
Solicitor Abad:
Never mind, I will reform the question.
xxxxxxxxx
Solicitor Abad (to the witness)
Q Is it not a fact that the vessel bumped the pier?
A That is right, it bumped the pier.
Q For the main reason that the anchor of the vessel did not hold the ground as expected?
A Yes sir, that is my opinion.[73]
Further, on redirect examination, Capt. Kabankov fortified his apathetic assessment of the
situation:
Q Now, after the anchor was dropped, was there any point in time that you felt that the
vessel was in imminent danger.
A No, at that time, the vessel was not in imminent danger, sir."[74]
This cavalier appraisal of the event by Capt. Kabankov is disturbingly antipodal to
Capt. Gavino's anxious assessment of the situation:
Q When a pilot is on board a vessel, it is the pilot's command which should be followed-at
that moment until the vessel is, or goes to port or reaches port?
A Yes, your Honor, but it does not take away from the Captain his prerogative to
countermand the pilot.
Q In what way?
A In any case, which he thinks the pilot is not maneuvering correctly, the Captain always has
the prerogative to countermand the pilot's order.
Q But insofar as competence, efficiency and functional knowledge of the seabed which are
vital or decisive in the safety (sic) bringing of a vessel to the port, he is not competent?
A Yes, your Honor. That is why they hire a pilot in an advisory capacity, but still, the safety of
the vessel rest(s) upon the Captain, the Master of the vessel.
Q In this case, there was not a disagreement between you and the Captain of the vessel in
the bringing of the vessel to port?
A No, your Honor.
Court:
May proceed.
Atty. Catris:
In fact, the Master of the vessel testified here that he was all along in conformity with
the orders you gave to him, and, as matter of fact, as he said, he obeyed all your
orders. Can you tell, if in the course of giving such normal orders for the saf(e) docking
of the MV Pavlodar, do you remember of any instance that the Master of the vessel
did not obey your command for the safety docking of the MV Pavlodar?
Atty. del Rosario:
Already answered, he already said yes sir.
Court:
Yes, he has just answered yes sir to the Court that there was no disagreement insofar
as the bringing of the vessel safely to the port.
Atty. Catris:
But in this instance of docking of the MV Pavlodar, do you remember of a time during
the course of the docking that the MV Pavlodar was in imminent danger of bumping
the pier?
A When we were about more than one thousand meters from the pier. I think, the anchor
was not holding, so I immediately ordered to push the bow at a fourth quarter, at the
 back of the vessel in order to swing the bow away from the pier and at the same time,
I ordered for a full astern of the engine."[75]
These conflicting reactions can only imply, at the very least, unmindful disregard or, worse,
neglectful relinquishment of duty by the shipmaster, tantamount to negligence.
The findings of the trial court on this aspect is noteworthy:
For, while the pilot Gavino may indeed have been charged with the task of docking the
vessel in the berthing space, it is undisputed that the master of the vessel had the corresponding
duty to countermand any of the orders made by the pilot, aid even maneuver the vessel himself,
in case of imminent danger to the vessel and the port.
In fact, in his testimony, Capt. Kavankov admitted that all throughout the man(eu)vering
procedures he did not notice anything was going wrong, and even observed that the order given
to drop the anchor, was done at the proper time. He even ventured the opinion that the accident
occurred because the anchor failed to take hold but that this did not alarm him because there
was still time to drop a second anchor.
Under normal circumstances, the above-mentioned facts would have caused the master
of a vessel to take charge of the situation and see to the man(eu)vering of the vessel
himself. Instead, Capt. Kavankov chose to rely blindly upon his pilot, who by this time was
proven ill-equipped to cope with the situation.
xxxxxxxxx
It is apparent that Gavino was negligent but Far Eastern's employee Capt. Kavankov was
no less responsible for as master of the vessel he stood by the pilot during the man(eu)vering
procedures and was privy to every move the latter made, as well as the vessel's response to
each of the commands. His choice to rely blindly upon the pilot's skills, to the point that despite
being appraised of a notice of alert he continued to relinquish control of the vessel to Gavino,
shows indubitably that he was not performing his duties with the diligence required of him and
therefore may be charged with negligence along with defendant Gavino. [76]
As correctly affirmed by the Court of Appeals -
We are in full accord with the findings and disquisitions of the Court a quo.
In the present recourse, Captain Viktor Kavankov had been a mariner for thirty-two years
before the incident. When Gavino was (in) the command of the vessel, Kavankov was beside
Gavino, relaying the commands or orders of Gavino to the crewmembers-officers of the vessel
concerned. He was thus fully aware of the docking maneuvers and procedure Gavino undertook
to dock the vessel. Irrefragably, Kavankov was fully aware of the bulk and size of the vessel and
its cargo as well as the weight of the vessel. Kavankov categorically admitted that, when the
anchor and two (2) shackles were dropped to the sea floor, the claws of the anchor did not hitch
on to any hard object in the seabed. The momentum of the vessel was not arrested. The use of
the two (2) tugboats was insufficient. The momentum of the vessel, although a little bit arrested,
continued (sic) the vessel going straightforward with its bow towards the port (Exhibit "A-
1"). There was thus a need for the vessel to move "full-astern" and to drop the other anchor with
another shackle or two '(2), for the vessel to avoid hitting the pier. Kavankov refused to act even
as Gavino failed to act. Even as Gavino gave mere "half-astern" order, Kavankov supinely stood
by. The vessel was already about twenty (20) meters away from the pier when Gavino gave the
'full-astern" order.Even then, Kavankov did nothing to prevent the vessel from hitting the pier
simply because he relied on the competence and plan of Gavino. While the "full-astern"
maneuver momentarily arrested the momentum of the vessel, it was, by then, too late. All along,
Kavankov stood supinely beside Gavino, doing nothing but relay the commands of
Gavino. Inscrutably, then, Kavankov was negligent.
xxxxxxxxx
The stark incompetence of Kavankov is competent evidence to prove the unseaworthiness of
the vessel. It has been held that the incompetence of the navigator, the master of the vessel or
its crew makes the vessel unseaworthy (Tug Ocean Prince versus United States of America,
584 F. 2nd, page 1151). Hence, the Appellant FESC is likewise liable for the damage sustained
by the Appellee."[77]
We find strong and well-reasoned support in time-tested American maritime jurisprudence,
on which much of our laws and jurisprudence on the matter are based, for the conclusions of the
Court of Appeals adjudging both Capt. Gavino and Capt. Kabankov negligent.
As early as 1869, the U.S. Supreme Court declared, through Mr. Justice Swayne, in The
Steamship China vs. Walsh,[78] that it is the duty of the master to interfere in cases of the pilot's
intoxication or manifest incapacity, in cases of danger which he does not foresee, and in all
cases of great necessity. The master has the same power to displace the pilot that he has to
remove any subordinate officer of the vessel, at his discretion.
In 1895, the U.S. Supreme Court, this time through Mr. Justice Brown, emphatically ruled
that:
Nor are we satisfied with the conduct of the master in leaving the pilot in sole charge of
the vessel.While the pilot doubtless supersedes the master for the time being in the command
and navigation of the ship, and his orders must be obeyed in all matters connected with her
navigation, the master is not wholly absolved from his duties while the pilot is on board, and may
advise with him, and even displace him in case he is intoxicated or manifestly incompetent. He is
still in command of the vessel, except so far as her navigation is concerned, and bound to see
that there is a sufficient watch on deck, and that the men are attentive to their duties.
xxx (N)otwithstanding the pilot has charge, it is the duty of the master to prevent accident,
and not to abandon the vessel entirely to the pilot; but that there are certain duties he has to
discharge (notwithstanding there is a pilot on board) for the benefit of the owners. x x x that in
well conducted ships the master does not regard the presence of a duly licensed pilot in
compulsory pilot waters as freeing him from every obligation to attend to the safety of the vessel;
but that, while the master sees that his officers and crew duly attend to the pilot's orders, he
himself is bound to keep a vigilant eye on the navigation of the vessel, and, when exceptional
circumstances exist, not only to urge upon the pilot to use every precaution, but to insist upon,
such being taken."[79] (Italics for emphasis.)
In Jure vs. United Fruit Co.,[80] which, like the present petitions, involved compulsory
pilotage, with a similar scenario where at and prior to the time of injury, the vessel was in the
charge of a pilot with the master on the bridge of the vessel beside said pilot, the court therein
ruled:
The authority of the master of a vessel is not in complete abeyance while a pilot, who is
required by law to be accepted, is in discharge of his functions. x x x It is the duty of the master
to interfere in cases of the pilot's intoxication or manifest incapacity, in cases of danger which he
does not foresee, and in all cases of great necessity . The master has the same power to
displace the pilot that he has to remove any subordinate officer of the vessel. He may exercise it,
or not, according to his discretion. There was evidence to support findings that plaintiff's injury
was due to the negligent operation of the Atenas, and that the master of that vessel was
negligent in failing to take action to avoid endangering a vessel situated as the City of Canton
was and persons or property thereon.
A phase of the evidence furnished support for the inferences x x x that he negligently
failed to suggest to the pilot the danger which was disclosed, and means of avoiding such
danger; and that the master's negligence in failing to give timely admonition to the pilot
proximately contributed to the injury complained of. We are of opinion that the evidence
mentioned tended to prove conduct of the pilot, known to the master, giving rise to a case of
danger or great necessity, calling for the intervention of the master. A master of a vessel is not
Without fault in acquiescing in conduct of a pilot which involves apparent and avoidable danger,
whether such danger is to the vessel upon which the pilot is, or to another vessel, or persons or
property thereon or on shore. (Italics ours.)
Still in another case involving a nearly identical setting, the captain of a vessel alongside the
compulsory pilot was deemed to be negligent, since, in the words of the court, "he was in a
position to exercise his superior authority if he had deemed the speed excessive on the occasion
in question. I think it was clearly negligent of him not to have recognized the danger to any craft
moored at Gravell Dock and that he should have directed the pilot to reduce his speed as
required by the local governmental regulations. His failure amounted to negligence and renders
the respondent liable."[81] (Italics supplied.) Though a compulsory pilot might be regarded as an
independent contractor, he is at all times subject to the ultimate control of the ship's master. [82]
In sum, where a compulsory pilot is in charge of a ship, the master being required to
permit him to navigate it, if the master observes that the pilot is incompetent or physically
incapable, then it is the duty of the master to refuse to permit the pilot to act. But if no such
reasons are present, then the master is justified in relying upon the pilot, but not blindly. Under
the circumstances of this case, if a situation arose where the master, exercising that reasonable
vigilance which the master of a ship should exercise, observed, or should have observed, that
the pilot was so navigating the vessel that she was going, or was likely to go, into danger, and
there was in the exercise of reasonable care and vigilance an opportunity for the master to
intervene so as to save the ship from danger, the master should have acted accordingly. [83]The
master of a vessel must exercise a degree of vigilance commensurate with the circumstances. [84]
Inasmuch as the matter of negligence is a question of fact, [85] we defer to the findings of
the trial court, especially as this is affirmed by the Court of Appeals. [86] But even beyond that, our
own evaluation is that Capt. Kabankov's shared liability is due mainly to the fact that he failed to
act when the perilous situation should have spurred him into quick and decisive action as master
of the ship. In the face of imminent or actual danger, he did not have to wait for the
happenstance to occur before countermanding or overruling the pilot. By his own admission,
Capt. Kabankov concurred with Capt. Gavino's decisions, and this is precisely the reason why
he decided not to countermand any of the latter's orders. Inasmuch as both lower courts found
Capt. Gavino negligent, by expressing full agreement therewith Capt. Kabankov was just as
negligent as Capt. Gavino.
In general, a pilot is personally liable for damages caused by his own negligence or
default to the owners of the vessel, and to third parties for damages sustained in a
collision. Such negligence of the pilot in the performance of duty constitutes a maritime tort.[87] At
common law, a shipowner is not liable for injuries inflicted exclusively by the negligence of a pilot
accepted by a vessel compulsorily.[88] The exemption from liability for such negligence shall
apply if the pilot is actually in charge and solely in fault.Since, a pilot is responsible only for his
own personal negligence, he cannot be held accountable for damages proximately caused by
the default of others,[89] or, if there be anything which concurred with the fault of the pilot in
producing the accident, the vessel master and owners are liable.
Since the colliding vessel is prima facie responsible, the burden of proof is upon the party
claiming benefit of the exemption from liability. It must be shown affirmatively that the pilot was
at fault, and that there was no fault on the part of the officers or crew, which might have been
conducive to the damage.The fact that the law compelled the master to take the pilot does not
exonerate the vessel from liability.The parties who suffer are entitled to have their remedy
against the vessel that occasioned the damage, and are not under necessity to look to the pilot
from whom redress is not always had for compensation.The owners of the vessel are
responsible to the injured party for the acts of the pilot, and they must be left to recover the
amount as well as they can against him. It cannot be maintained that the circumstance of having
a pilot on board, and acting in conformity to his directions operate as a discharge of
responsibility of the owners.[90] Except insofar as their liability is limited or exempted by statute,
the vessel or her owner are liable for all damages caused by the negligence or other wrongs of
the owners or those in charge of the vessel. Where the pilot of a vessel is not a compulsory one
in the sense that the owner or master of the vessel are bound to accept him, but is employed
voluntarily, the owners of the vessel are, all the more, liable for his negligent act.[91]
In the United States, the owners of a vessel are not personally liable for the negligent acts
of a compulsory pilot, but by admiralty law, the fault or negligence of a compulsory pilot is
imputable to the vessel and it may be held liable therefor in rem. Where, however, by the
provisions of the statute the pilot is compulsory only in the sense that his fee must be paid, and
is not in compulsory charge of the vessel, there is no exemption from liability. Even though the
pilot is compulsory, if his negligence was not the sole cause of the injury, but the negligence of
the master or crew contributed thereto, the owners are liable. [92]But the liability of the ship in
rem does not release the pilot from the consequences of his own negligence. [93] The rationale for
this rule is that the master is not entirely absolved of responsibility with respect to navigation
when a compulsory pilot is in charge.[94]
By way of validation and in light of the aforecited guidepost rulings in American maritime
cases, we declare that our rulings during the early years of this century in City of Manila
vs. Gambe, [95] China Navigation Co., Ltd. vs. Vidal,[96] and Yap Tico & Co. vs. Anderson, et
al.[97] have withstood the proverbial test of time and remain good and relevant case law to this
day.
City of Manila stands for the doctrine that the pilot who was in command and complete
control of a vessel, and not the owners, must be held responsible for an accident which was
solely the result of the mistake of the pilot in not giving proper orders, and which did not result
from the failure of the owners to equip the vessel with the most modern and improved
machinery. In China Navigation Co., the pilot deviated from the ordinary and safe course,
without heeding the warnings of the ship captain. It was this careless deviation that caused the
vessel to collide with a pinnacle rock which, though uncharted, was known to pilots and local
navigators. Obviously, the captain was blameless. It was the negligence of the pilot alone which
was the proximate cause of the collision. The Court could not but then rule that -
The pilot in the case at bar having deviated from the usual and ordinary course followed
by navigators in passing through the strait in question, without a substantial reason, was guilty of
negligence, and that negligence having been the proximate cause of the damages, he is liable
for such damages as usually and naturally flow therefrom. x x x.
x x x (T)he defendant should have known of the existence and location of the rock upon
which the vessel struck while under his control and management. x x x.
Consistent with the pronouncements in these two earlier cases, but on a slightly different
tack, the Court in Yap Tico & Co. exonerated the pilot from liability for the accident where the
order's of the pilot in the handling of the ship were disregarded by the officers and crew of the
ship. According to the Court, a pilot is "x x x responsible for a full knowledge of the channel and
the navigation only so far as he can accomplish it through the officers and crew of the ship, and I
don't see that he can be held responsible for damage when the evidence shows, as it does in
this case, that the officers and crew of the ship failed to obey his orders." Nonetheless, it is
possible for a compulsory pilot and the master of the vessel to be concurrently negligent and
thus share the blame for the resulting damage as Joint tortfeasors,[98] but only under the
circumstances obtaining in and demonstrated by the instant petitions.
 It may be said, as a general rule, that negligence in order to render a person liable need
not be the sole cause of an injury. It is sufficient that his negligence, concurring with one or more
efficient causes other than plaintiff's, is the proximate cause of the injury. Accordingly, where
several causes combine to produce injuries, a person is not relieved from liability because he is
responsible for only one of them, it being sufficient that the negligence of the person charged
with injury is an efficient cause without which the injury would not have resulted to as great an
extent, and that such cause is not attributable to the person injured. It is no defense to one of the
concurrent tortfeasors that the injury would not have resulted from his negligence alone, without
the negligence or wrongful acts of the other concurrent tortfeasor.[99] Where several causes
producing an injury are concurrent and each is an efficient cause without which the injury would
not have happened, the injury may be attributed to all or any of the causes and recovery may be
had against any or all of the responsible persons although under the circumstances of the case,
it may appear that one of them was more culpable, and that the duty owed by them to the injured
person was not the same. No actor's negligence ceases to be a proximate cause merely
because it does not exceed the negligence of other actors. Each wrongdoer is responsible for
the entire result and is liable as though his acts were the sole cause of the injury.[100]
There is no contribution between joint tortfeasors whose liability is solidary since both of
them are liable for the total damage. Where the concurrent or successive negligent acts or
omissions of two or more persons, although acting independently, are in combination the direct
and proximate cause of a single injury to a third person, it is impossible to determine in what
proportion each contributed to the injury and either of them is responsible for the whole
injury. Where their concurring negligence resulted in injury or damage to a third party, they
become joint tortfeasors and are solidarity liable for the resulting damage under Article
2194[101] of the Civil Code.[102]
As for the amount of damages awarded by the trial court, we find the same to be
reasonable. The testimony of Mr. Pascual Barral, witness for PPA, on cross and redirect
examination, appears to be grounded on practical considerations:
Q So that the cost of the two additional piles as well as the (two) square meters is already
included in this -P1,300,999.77.
A Yes sir, everything. It is (the) final cost already.
Q For the eight piles.
A Including the reduced areas and other reductions.
Q (A)nd the two square meters.
A Yes sir.
Q In other words, this P1,300,999.77 does not represent only for the six piles that was
damaged as well as the corresponding two piles.
A The area was corresponding, was increased by almost two in the actual payment. That
was why the contract was decreased, the real amount was P1,124,627.40 and the
final one is P1300,999.77.
Q Yes, but that P1,300,999.77 included the additional two new posts.
A It was increased.
Q Why was it increased?
A The original was 48 and the actual was 46.
Q Now, the damage was somewhere in 1980. It took place in 1980 and you started the
repair and reconstruction in 1982, that took almost two years?
A Yes sir.
Q May it not happen that by natural factors, the existing damage in 1980 was aggravated for
the 2 year period that the damage portion was not repaired?
A I don't think so because that area was at once marked and no vehicles can park, it was
closed.
Q Even if or even natural elements cannot affect the damage?
A Cannot, sir.
xxxxxxxxx
Q You said in the cross-examination that there were six piles damaged by the accident, but
that in the reconstruction of the pier, PPA drove and constructed 8 piles. Will you
explain to us why there was change in the number of piles from the original number?
A In piers where the piles are withdrawn or pulled out, you cannot re-drive or drive piles at
the same point. You have to redesign the driving of the piles. We cannot drive the
piles at the same point where the piles are broken or damaged or pulled out. We have
to redesign, and you will note that in the reconstruction, we redesigned such that it
necessitated 8 piles.
Q Why not, why could you not drive the same number of piles and on the same spot?
A The original location was already disturbed. We cannot get required bearing capacity. The
area is already disturbed.
Q Nonetheless, if you drove the original number of piles, six, on different places, would not
that have sustained the same load?
A It will not suffice, sir."[103]
We quote the findings of the lower court with approval:
With regards to the amount of damages that is to be awarded to plaintiff, the Court finds that the
amount of P1,053,300.00 is justified. Firstly, the doctrine of res ipsa loquitur best expounded
upon in the landmark case of Republic vs. Luzon Stevedoring Corp. (21 SCRA 279) establishes
the presumption that in the ordinary course of events the ramming of the dock would not have
occurred if proper care was used.
Secondly, the various estimates and plans justify the cost of the port construction price. The new
structure constructed not only replaced the damaged one but was built of stronger materials to
forestall the possibility of any similar accidents in the future.
The Court inevitably finds that the plaintiff is entitled to an award of P1,053,300.00 which
represents actual damages caused by the damage to Berth 4 of the Manila International
Port. Co-defendants Far Eastern Shipping, Capt. Senen Gavino and Manila Pilots Association
are solidarity liable to pay this amount to plaintiff.[104]
The Solicitor General rightly commented that the adjudicated amount of damages represents the
proportional cost of repair and rehabilitation of the damaged section of the pier. [105]
Except insofar as their liability is limited or exempted by statute, the vessel or her owners
are liable for all damages caused by the negligence or other wrongs of the owners or those in
charge of the vessel. As a general rule, the owners or those in possession and control of a
vessel and the vessel are liable for all natural and proximate damages caused to persons or
property by reason of her negligent management or navigation.[106]
 FESC's imputation of PPA's failure to provide a safe and reliable berthing place is obtuse,
not only because it appears to be a mere afterthought, being tardily raised only in this petition,
but also because there is no allegation or evidence on record about Berth No. 4 being unsafe
and unreliable, although perhaps it is a modest pier by international standards. There was,
therefore, no error on the part of the Court of Appeals in dismissing FESC's counterclaim.
II. G.R. No. 130150
This consolidated case treats on whether the Court of Appeals erred in holding MPA jointly
and solidarity liable with its member pilot, Capt. Gavino, in the absence of employer-employee
relationship and in applying Customs Administrative Order No. 15-65, as basis for the adjudged
solidary liability of MPA and Capt. Gavino.
The pertinent provisions in Chapter I of Customs Administrative Order No. 15-65 are:
"PAR. XXVII.-- In all pilotage districts where pilotage is compulsory, there shall be created and
maintained by the pilots or pilots' association, in the manner hereinafter prescribed, a reserve
fund equal to P1,000.00 for each pilot thereof for the purpose of paying claims for damages to
vessels or property caused through acts or omissions of its members while rendered in
compulsory pilotage service. In Manila, the reserve fund shall be P2,000.00 for each pilot.
PAR. XXVIII.-- A pilots' association shall not be liable under these regulations for damage to any
vessel, or other property, resulting from acts of a member of an association in the actual
performance of his duty for a greater amount than seventy-five per centum (75%) of its
prescribed reserve fund; it being understood that if the association is held liable for an amount
greater than the amount above-stated, the excess shall be paid by the personal funds of the
member concerned.
PAR. XXXI.-- If a payment is made from the reserve fund of an association on account of
damages caused by a member thereof, and he shall have been found at fault, such member
shall reimburse the association in the amount so paid as soon as practicable; and for this
purpose, not less than twenty-five per centum of his dividends shall be retained each month until
the full amount has been returned to the reserve fund.
PAR. XXXIV. - Nothing in these regulations shall relieve any pilots' association or members
thereof, individually or collectively, from civil responsibility for damages to life or property
resulting from the acts of members in the performance of their duties.
Correlatively, the relevant provisions of PPA Administrative Order No. 03-85, which timely
amended this applicable maritime regulation, state:
Article IV
SEC. 17. Pilots' Association -- The Pilots in a Pilotage District shall organize themselves into a
Pilots' Association or firm, the members of which shall promulgate their own By-Laws not in
conflict with the rules and regulations promulgated by the Authority. These By-Laws shall be
submitted not later than one (1) month after the organization of the Pilots' Association for
approval by the General Manager of the Authority. Subsequent amendments thereto shall
likewise be submitted for approval.
SEC. 25. Indemnity Insurance and Reserve Fund--
a) Each Pilots' Association shall collectively insure its membership at the rate
of P50,000.00 each member to cover in whole or in part any
liability arising from any accident resulting in damage to vessel(s),
port facilities and other properties and/or injury to persons or
death which any member may have caused in the course of his
performance of pilotage duties. x x x.
b) The Pilotage Association shall likewise set up and maintain a reserve fund
which shall answer for any part of the liability referred to in the
immediately preceding paragraph which is left unsatisfied by the
insurance proceeds, in the following manner:
1) Each pilot in the Association shall contribute from his own account an
amount of P4,000.00 (P6,000.00 in the Manila Pilotage District) to
the reserve fund. This fund shall not be considered part of the
capital of the Association nor charged as an expense thereof.
2) Seventy-five percent (75%) of the reserve fund shall be set aside for
use, in the payment of damages referred to above incurred in the
actual performance of pilots' duties and the excess shall be paid
from the personal funds of the member concerned.
xxxxxxxxx
5) If payment is made from the reserve fund of an Association on
account of damage caused by a member thereof who is found at
fault, he shall reimburse the Association in the amount so paid
as soon as practicable; and for this purpose, not less than
twenty-five percentum (25%) of his dividend shall be retained
each month until the full amount has been returned to the
reserve fund. Thereafter, the pilot involved shall be entitled to his
full dividend.
6) When the reimbursement has been completed as prescribed in the
preceding paragraph, the ten percentum (10%) and the interest
withheld from the shares of the other pilots in accordance with
paragraph (4) hereof shall be returned to them.
c) Liability of Pilots' Association -- Nothing in these regulations shall
relieve any Pilots' Association or members thereof, individually
or collectively, from any civil, administrative and/or criminal
responsibility for damages to life or property resulting from the
individual acts of its members as well as those of the
Association's employees and crew in the performance of their
duties.
The Court of Appeals, while affirming the trial court's finding of solidary liability on the part
of FESC, MPA and Capt. Gavino, correctly based MPA's liability not on the concept of employer-
employee relationship between Capt. Gavino and itself, but on the provisions of Customs
Administrative Order No. 15-65:
The Appellant MPA avers that, contrary to the findings and disquisitions of the Court a quo, the
Appellant Gavino was not and has never been an employee of the MPA but was only a member
thereof. The Court a quo, it is noteworthy,, did not state the factual basis on which it anchored its
finding that Gavino was the employee of MPA. We are in accord with MPA's pose. Case law
teaches Us that, for an employer-employee relationship to exist the confluence of the following
elements must be established: (1) selection and engagement of employees; (2) the payment of
wages; (3) the power of dismissal; (4) the employer's power to control the employees with
respect to the means and method by which the work is to be performed (Ruga versus NLRC,
181SCRA 266).
xxxxxxxxx
The liability of MPA for damages is not anchored on Article 2180 of the New Civil Code as
erroneously found and declared by the Court a quo but under the provisions of Customs
Administrative Order No. 15-65, supra, in tandem with the by-laws of the MPA."[107]
[108]
There being no employer-employee relationship, clearly Article 2180 of the Civil Code
is inapplicable since there is no vicarious liability of an employer to speak of. It is so stated in
American law, as follows:
The well-established rule is that pilot associations are immune to vicarious liability for the tort of
their members. They are not the employer of their members and exercise no control over them
once they take the helm of the vessel. They are also not partnerships because the members do
not function as agents for the association or for each other. Pilots' associations are also not
liable for negligently assuring, the competence of their members because as professional
associations they made no guarantee of the professional conduct of their members to the
general public.[109]
Where under local statutes and regulations, pilot associations lack the necessary legal
incidents of responsibility, they have been held not liable for damages caused by the default of a
member pilot.[110]Whether or not the members of a pilots' association are in legal effect a
copartnership depends wholly on the powers and duties of the members in relation to one
another under the provisions of the governing statutes and regulations. The relation of a pilot to
his association is not that of a servant to the master, but of an associate assisting and
participating in a common purpose. Ultimately, the rights and liabilities between a pilots'
association and an individual member depend largely upon the constitution, articles or by-laws of
the association, subject to appropriate government regulations.[111]
No reliance can be placed by MPA on the cited American rulings as to immunity from
liability of a pilots' association in light of existing positive regulation under Philippine law. The
Court of Appeals properly applied the clear and unequivocal provisions of Customs
Administrative Order No. 15-65. In doing so, it was just being consistent with its finding of the
non-existence of employer-employee relationship between MPA and Capt. Gavino precludes the
application of Article 2180 of the Civil Code.
True, Customs Administrative Order No. 15-65 does not categorically characterize or label
MPA's liability as solidary in nature. Nevertheless, a careful reading and proper analysis of the
correlated provisions lead to the conclusion that MPA is solidarity liable for the negligence of its
member pilots, without prejudice to subsequent reimbursement from the pilot at fault.
Article 1207 of the Civil Code provides that there is solidary liability only when the
obligation expressly so states, or when the law or the nature of the obligation requires
solidarity. Plainly, Customs Administrative Order No. 15-65, which as an implementing rule has
the force and effect of law, can validly provide for solidary liability. We note the Solicitor
General's comment hereon, to wit:
x x x Customs Administrative Order No. 15-65 may be a mere rule and regulation issued by an
administrative agency pursuant to a delegated authority to fix "the details" in the execution or
enforcement of a policy set out in the law itself. Nonetheless, said administrative order, which
adds to the procedural or enforcing provisions of substantive law, is legally binding and receives
the same statutory force upon going into effect. In that sense, it has equal, not lower, statutory
force and effect as a regular statute passed by the legislature."[112]
MPA's prayer for modification of the appellate court's decision under review by exculpating
petitioner MPA "from liability beyond seventy-five percent (75%) of Reserve Fund" is
unnecessary because the liability of MPA under Par. XXVIII of Customs Administrative Order
No. 15-65 is in fact limited to seventy-five percent (75%) of its prescribed reserve fund, any
amount of liability beyond that being for the personal account of the erring pilot and subject to
reimbursement in case of a finding of fault by the member concerned. This is clarified by the
Solicitor General:
Moreover, contrary to petitioners pretensions, the provisions of Customs Administrative Order
No. 15-65 do not limit the liability of petitioner as a pilots' association to an absurdly small
amount of seventy-five per centum (75%) of the member pilots' contribution of P2,000.00 to the
reserve fund. The law speaks of the entire reserve fund required to be maintained by the pilots'
association to answer (for) whatever liability arising from the tortious act of its members. And
even if the association is held liable for an amount greater than the reserve fund, the association
may not resist the liability by claiming to be liable only up to seventy-five per centum (75%) of
the reserve fund because in such instance it has the right to be reimbursed by the offending
member pilot for the excess."[113]
WHEREFORE, in view of all of the foregoing, the consolidated petitions for review are
DENIED and the assailed decision of the Court of Appeals is AFFIRMED in toto.
Counsel for FESC, the law firm of Del Rosario and Del Rosario, specifically its associate,
Atty. Herbert A. Tria, is REPRIMANDED and WARNED that a repetition of the same or similar
acts of heedless disregard of its undertakings under the Rules shall be dealt with more severely.
The original members of the legal team of the Office of the Solicitor General assigned to
this case, namely, Assistant Solicitor General Roman G. Del Rosario and Solicitor Luis F.
Simon, are ADMONISHED and WARNED that a repetition of the same or similar acts of unduly
delaying proceedings due to delayed filing of required pleadings shall also be dealt with more
stringently.
The Solicitor General is DIRECTED to look into the circumstances of this case and to
adopt provident measures to avoid a repetition of this incident and which would ensure prompt
compliance with orders of this Court regarding the timely filing of requisite pleadings, in the
interest of just, speedy and orderly administration of justice.
Let copies of this decision be spread upon the personal records of the lawyers named
herein in the Office of the Bar Confidant.
SO ORDERED.
G.R. No. 85939 April 19, 1991
NEW PANGASINAN REVIEW, INC., petitioner,
vs.
THE NATIONAL LABOR RELATIONS COMMISSION, LABOR ARBITER RICARDO N.
OLAIREZ, Provincial & City Sheriff Ex-Officio ALICIA BRAVO-FABIA, Deputy Sheriff
ROMEO M. QUERIMIT and CONSTANCIA C. ADAJAR, SALUD G. MAGSANO, BIENVENIDO
MENESES, AMADO P. BOLSICO, REGINO P. VELASCO, CANITO E. ABALOS, MYRNA S.
MARAMBA, EPIFANIA M. MAGSANO, JUAN D. ALCALDE, ANTONIO T. MARAMBA,
4. Amado P. Bolsico 16,884.00
TERESITA A. ADAJAR, ROBERTO F. GARCIA, RODOLFO S. CALLANTA, PEDRO C.
CALIMLIM, ALEXANDER G. URBANO, VICTORIO B. NATIVIDAD, CRESENCIO F.
5. Regino P. Velasco 13,507.20
RAVANCHO, ISAGANI FERNANDEZ AND JOSE N. FERMIL respondents.
6. Canuto E. Abalos 12,542.40
G.R. No. 86968 April 19, 1991
7. Myrna S. Maramba 10,992.70
LABOR ARBITER RICARDO N. OLAIREZ, NATIONAL LABOR RELATIONS COMMISSION, 8. Epifania M. Magsano 9,498.00
SHERIFFS ALICIA BRAVO-FABIA & ROMEO QUERIMIT, CONSTANCIA ADAJAR, SALUD
MAGSANO, BIENVENIDO MENESES, AMADO BOLSICO, REGINO VELASCO, CANUTO 9. Juan D. Alcaide 11,095.20
ABALOS, MYRNA MIRANDA, EPIFANIA MAGSANO, JUAN ALCALDE, ANTONIO
MARAMBA, TERESITA ADAJAR ROBERTO GARCIA, RODOLFO CALLANTA, PEDRO 10. Antonio T. Maramba 9,165.60
CALIMLIM, ALEXANDER URBANO, VICTORIO NATIVIDAD, CRESENCIO RAVANCHO,
ISAGANI FERNANDEZ AND JOSE N. FERMIL, petitioners, 11. Teresita A. Adajar 5,223.90
vs.
JUDGE TEODORO J. SISON, NEW PANGASINAN REVIEW, INC., represented by RENATO 12. Roberto F. Garcia 7,718.40
ZABALA and PANGASINAN REVIEW INC. represented by JOSEFINA V.
FERNANDEZ, respondents. 13. Rodolfo S. Callanta 5,223.90

Felipe P. de Vera for New Pangasinan Review, Inc. 14. Pedro C. Calimlim 2,894.40
Nellie M. Olairez for the Labor Arbiter.
15. Alexander G. Urbano 7,123.50

16. Victorio B. Natividad 1,507.50

17. Cresencio Ravancho 2,040.00

MEDIALDEA, J.:
18. Isagani Fernandez 3,220.00

Before Us are consolidated petitions for prohibition and certiorari with prayer for restraining order 19. Jose Fermil 17,340.00
and/or writ of preliminary injunction.
TOTAL 180,764.00
In G.R. No. 85939
(pp. 64-65, Rollo)
Petitioner New Pangasinan Review Inc. (hereafter "NPRI") seeks to annul the proceedings in
NLRC Case No. SUB-RAB-1071-86, entitled "Constancia Adajar, et al. v. Pangasinan Review,
Inc., dated May 30, 1988 (Annex "Q") which affirmed the decision dated June 10, 1987 (Annex The following facts, as culled from the Solicitor General's Comments, are undisputed:
"P") of Labor Arbiter Irenarco R. Rimando, which disposed as follows:
1. Private respondents were employees of the Pangasinan Review, Inc. (hereafter
IN THE LIGHT OF THE FOREGOING OBSERVATIONS, it appearing that the "PRI") a corporation engaged in the business of printing, bookbinding and publishing
respondent ceased its operations by virtue of the expiration of its corporate charter, newspapers whose corporate life legally expired on October 27, 1982 after fifty years
and the closure is not due to serious business losses or financial reverses, the of corporate existence.
complainants are therefore entitled to a separation pay, in accordance with the
provisions of Art. 284 (now Art. 283) of the Labor Code. The corporation through the 2. Notwithstanding the expiry of its corporate life, PRI, however, actually continued its
Board of Liquidators are directed to pay the separation pay of the following business operations until it was advised by the Securities and Exchange Commission
employees: (SEC) in a letter dated January 10, 1985 (Annex "D", Petition) that its corporate term
had already expired.

Name of Employees Separation Pay

3. On January 21, 1985, the Board of Directors of PRI, complying with the SEC
advice, passed a resolution authorizing the current Board of Directors to undertake the
1. Constancia Adajar 18,900.00
liquidation of the company by reason of the expiry of its corporate term.
2. Salud G. Magsano 13,770.00
4. Earlier, on January 20, 1985, a splinter group led by Director Anastacio T. Zamuco,
3. Bienvenido Meneses 12,187.50 together with several others, filed with the SEC a petition for authority to allow PRI to
renew its corporate existence and to continue its usual business operations. The SEC,
however, in an Order dated May 3, 1985, denied Zamuco's petition and instead
ordered them to liquidate the assets of the company (Annex "E", Petition).
5. On April 29, 1985, the Board of Directors minus Zamuco and Mrs. Corazon C.
Fernandez who were then absent, acting as a Board of Liquidators of the company
passed, inter alia, Resolution No. 1985-2 (pp. 403-404, NLRC Record) conveying
corporate properties of the defunct PRI, to the NPRI which had been newly
incorporated, thus:
That the Pangasinan Review, Inc. had only a period of three years from its
dissolution on September 23, 1982, within which to wind up its affairs.
WHEREFORE, resolved, as it is hereby resolved, as the most speedy and
feasible means of winding up its affairs, to convey the corporate properties,
including the right to publish the Courier, for the benefit of stockholders and
creditors, to the New Pangasinan Review, Inc., which was just granted a
certificate of registration on March 27, 1985 by the SEC, in which case,
claims against the defunct Pangasinan Review, Inc., may be presented as
long as the New Pangasinan Review, Inc., exists subject, however, to the
statute of limitations; Resolved further that as consideration of the transfer,
conveyance and assignment mentioned, the New Pangasinan Review, Inc.,
will undertake to issue and deliver unto the stockholders of the defunct
Pangasinan Review, Inc., such number of fully paid shares of the capital
stock of the former of the par value of P100.00 each, equivalent to the net
book value of the assets of the defunct Pangasinan Review, Inc., without
prejudice to the rights of third parties; and Resolved finally to constitute and
authorize the President Dr. Josefina V. Fernandez to represent the defunct
Pangasinan Review, Inc., in the execution of the aforementioned transfer or
assignment of corporate properties with full power to do and perform all and
every act and thing whatsoever necessary to be done in and about the
premises. (Emphasis ours) (pp. 116-117, Rollo).
6. Pursuant to the said Resolution No. 1985-2, a Deed of assignment was executed
on the same day, April 29, 1985 by and between PRI thru its President, Josefina F. de
Venecia-Fernandez, and NPRI thru its treasurer, Salvacion M. Hernando (pp. 405-
407, NLRC Record) stipulating, among others, as follows:
xxx xxx xxx
WHEREAS, the FIRST PARTY by action of its Board of Directors in its
meeting held on the 29th day of April, 1985, approved a proposal to transfer
and convey to the SECOND PARTY, all the properties of the FIRST
PARTY, which are described in Annex "A" hereof, in exchange for fully paid
up shares of the SECOND PARTY, each of the par value of P100.00, equal
in number of shares based on the net book value (assets minus liabilities) of
the Total Assets of the FIRST PARTY, with the understanding that the
SECOND PARTY would assume and pay all the liabilities and obligations of
the FIRST PARTY of every kind as may appear outstanding and subsisting
in its books as of 19 January 1985; and
WHEREAS, the liquidation of the FIRST PARTY will not prejudice the rights
of third parties.
xxx xxx xxx
For the consideration mentioned in the second "WHEREAS" hereof, the
FIRST PARTY hereby transfers, conveys and assigns unto the SECOND
PARTY, absolutely and forever, effective upon the execution of this Deed,
all its (the "Company's") properties, more particularly described in the list
attached hereto and made an integral part hereof as Annex "A", with the
understanding that the SECOND PARTY shall assume and pay all its
liabilities and obligations of every kind as may appear outstanding and
subsisting in its book as of 19 January 1985.
xxx xxx xxx
The SECOND PARTY hereby assumes, and hereby undertakes to pay,
satisfy, discharge, perform and fulfill, all the debts, liabilities, contracts;
engagements and obligations of the FIRST PARTY of every kind, as may
appear outstanding and subsisting in its books as of 19 January 1985,
whether these are or thereafter to become due, and to indemnify the FIRST
PARTY, its Board of Directors and Officers, against, and keep them free
and harmless from, all actions, proceedings, claims and demands in respect
thereof.
xxx xxx xxx
The parties hereto hereby mutually agree to sign, execute, acknowledge
and deliver, jointly or each of them separately, such further deeds,
documents, agreements, papers and other writings as may be necessary to
carry into full effect their intents and purposes as contemplated herein. (pp.
118-119, Rollo)
On June 17, 1985, the nineteen private respondents, together with Jun Velasco,
Maximo Cerezo, Victor Quimbay and Generoso Sandaydiego III, filed with the
Chairman of the Board of Liquidators thru the SEC a written claim for payment of their
separation pay and ECOLA, copy furnished to Atty. Anastacio Zamuco, Chairman of
the Board of Liquidators, and to the Ministry of Labor and Employment at Dagupan
City (p. 30, NLRC Record) where, apparently, said claim was docketed as NLRC Case
No. SUB-RAB-I-540-85 (vide, pp. 1, 4, 5, NLRC Record). (pp. 120 and 226, Rollo)
Atty. Zamuco directed the said claimants to submit supporting papers to the Chairman
or Secretary of the Board of Liquidators so that their claims could be processed (p. 30,
NLRC Record) prompting the counsel of said claimants to move for the provisional
dismissal of the NLRC case (vide, pp. 1, 16, NLRC Record).
On October 9, 1986, however, the private respondents revived their claims with the
MOLE Dagupan Office when nothing positive was arrived at. They filed a formal
complaint against PRI for payment of their separation pay, 13th month pay, ECOLA
and damages, docketed as NLRC Case No. SUB-RAB-I-1071-86 (pp. 12-15, NLRC
Record; Annex "O", Petition).
PRI contended that they were not entitled to any separation pay, 13th month pay and
ECOLA because the company had ceased to exist by reason of the expiry of its term
and the private respondents were neither removed from office nor their services
terminated.
On June 10, 1987, Labor Arbiter Irenarco Rimando rendered the disputed decision.
PRI appealed. On May 30, 1988, NLRC affirmed the appealed Decision of the Labor
Arbiter.
Upon receipt by the Dagupan Arbitration Branch of the record for execution of the
judgment, Labor Arbiter Dominador Saludares, who replaced Labor Arbiter Irenarco
Rimando, called the parties to a conference including Dr. Josefina V. Fernandez,
President of the Pangasinan Review, Inc., and Mr. Renato Zabala, Board Chairman of
NPRI (pp. 389-393, NLRC Record; Annex "R", Petition). However, only the private
respondents appeared. Dr. Fernandez and Mr. Zabala, filed a joint manifestation (p.
394, NLRC Record; Annex' "S", petition) that they could not participate in the
conference alleging that they have no authority to speak for their corporation.
On October 21, 1988, the next scheduled date of the conference, Dr. Fernandez again
filed a manifestation reiterating her refusal to participate (p. 395, NLRC Record). The
complainants (herein private respondent) submitted copies of Resolution No. 1985-2
of the Board of Pangasinan Review, Inc. (quoted under paragraph 5, above), and
Deed of Assignment dated April 29, 1985 showing assumption of the liabilities of PRI
by NPRI.
On November 3, 1988, Labor Arbiter Ricardo N. Olairez, who replaced Labor Arbiter
Saludares issued a Special Order which reads as follows:
NOW, THEREFORE, in the name of the Republic of the Philippines, you are
hereby commanded to collect from the Pangasinan Review, Inc. and/or the
New Pangasinan Review, Inc. the amount of P180,764.00 by garnishing the
monetary deposits of the Pangasinan Review, Inc. and/or the New
Pangasinan Review, Inc. at any of the banks in Dagupan City or in
Pangasinan Province, and if you fail to collect the said amount including
your legal and sheriffs fees, you are to proceed to the premises of the
Pangasinan Review, Inc. and sieze (sic) the Chattels and goods of the
Pangasinan Review, Inc. and/or the New Pangasinan Review, Inc. except
such as are by law exempt and make sale thereof according to the Rules of
Court and deposit the amount collected by you to the Special Disbursing
Officer of this Office for proper disposition, except the amount of your legal
and sheriff s fees.
In case sufficient personal property of the Pangasinan Review, Inc. and/or
New Pangasinan Review, Inc. cannot be found to satisfy the amount of
P180,764.00 and your legal and sheriff's fees thereon, you are ordered to
levy upon the real estate of the Pangasinan Review, Inc. and/or New
Pangasinan Review, Inc. and sell the same according to the Rules of Court
for the satisfaction of the balance of the amount and your legal and sheriffs
fees and that you make a return of your proceedings upon this Writ of
Execution within 60 days from today." (pp. 19-20, Rollo) (Emphasis
supplied)
The Deputy Sheriff served the Writ of Execution and a Notice of Levy (Annex "W"
Petition) upon NPRI thru its Board Chairman, Mr. Renato Zabala, as well as Dr.
Josefina V. Fernandez. A notice of garnishment was also served upon the
manager/cashier of the Bank of the Philippine Islands (Bank of P.I.) Dagupan City
Branch on November 7, 1988 (Annex "V", Petition).
On November 10, 1988, NPRI filed a third party claim on the levied/garnished
properties (pp. 416-418, NLRC Record; Annex "X", Petition, p. 125, Rollo, G.R. 85939,
p. 10, Rollo, G.R. 86968).
On November 11, 1988, respondent Labor Arbiter Olairez issued a Release Order (p.
420, NLRC Record; Annex "Y", Petition) on the garnished P111,910.25 deposit with
the Bank of P.I., pursuant to which the bank released the said amount to the
respondent Deputy Sheriff (Annex "Z" Petition) who then turned over the same to the
private respondents thru their counsel (p. 439, NLRC record).
Another order of release dated November 7, 1988 for the amount of P7,154.00 was
not satisfied because of the third party claim, copy of which was received by the
deputy sheriff (p. 10, Rollo, G.R. 86968).
On November 14, 1988, respondent Labor Arbiter issued a Resolution (pp. 422-431,
NLRC Record) denying the third party claim and directing the Sheriff to enforce the
writ of execution already issued (pp. 115-125, Rollo).
NPRI filed this petition on December 8, 1988 in G.R. 85939, on the following issues:
I
WHETHER OR NOT THE PROCEEDINGS IN NLRC CASE NO. SUB-RAB-
I-071-86 WERE NULL AND VOID ON THE GROUND THAT THE ACTION
WAS DIRECTED AGAINST THE DEFUNCT PANGASINAN REVIEW, INC.
AND WAS FILED BEYOND THE THREE YEAR PERIOD FOR
LIQUIDATION AND WINDING UP OF CORPORATE AFFAIRS WHICH
EXPIRED ON OCTOBER 27, 1985;
II
WHETHER OR NOT THE HEREIN PRIVATE RESPONDENTS WERE
ENTITLED TO SEPARATION PAY, CONSIDERING THAT THE
EMPLOYER, THE PANGASINAN REVIEW, INC., CEASED OPERATION
BY REASON OF THE EXPIRY OF ITS CORPORATE TERM;
III
WHETHER OR NOT THE JUDGMENT IN THE SAID LABOR CASE
AGAINST THE DEFUNCT PANGASINAN REVIEW, INC., CAN BE
ENFORCED AGAINST THE PETITIONER NPRI WHICH IS A DISTINCT
AND DIFFERENT CORPORATION AND IS NOT A PARTY THERETO. (p.
228, Rollo)
In G.R. No. 86968
Also on November 14, 1988, shortly before the third party claim was denied by petitioner
Olairez, NPRI filed with the Regional Trial Court, Branch 40 at Dagupan City, a complaint
against the labor arbiter and the private respondents for injunction and damages with prayer for
restraining order and/or writ of preliminary injunction (Civil Case No. D-9187) questioning the
execution of the decision in NLRC Case No. SUB-RAB-I-071-86). Summons was served upon
Olairez. Respondent Deputy Sheriff Querimit submitted his Partial Report to the effect that the
garnished amount of P111,910.24 had already been withdrawn from the Bank of Philippine
Islands and proportionately distributed to the complainants.
Judge Teodoro J. Sison of the Regional Trial Court issued a temporary restraining order and set
for hearing NPRI's application for preliminary injunction on November 25, 1988.
Olairez filed a motion to dismiss the complaint on the ground of lack of jurisdiction. The motion
was denied in open court. His motion for reconsideration was likewise denied.
Aside from Civil Case D-9187, Dr. Josefina V. Fernandez had filed a letter-complaint with the
Ombudsman against petitioner Olairez, questioning the judgment award in the labor case.
Olairez received a copy of the complaint (1st indorsement) on January 5, 1988) requiring his
comment thereon (p. 11, Rollo, G.R. 86968).
Hence, this petition in G.R. 86968 attributing grave abuse of discretion on the part of
respondent-judge in assuming jurisdiction over Civil Case D-9187 and issuing a temporary
restraining order against the Writ of Execution issued by the NLRC.
On January 9, 1989, We issued a temporary restraining order (TRO) in G.R. 85939 enjoining the
execution of the NLRC decision dated June 10, 1987.
In Our Resolution dated March 6, 1989. We directed the consolidation of G.R. No. 86968 with
G.R. No. 85939 as they both stemmed from the monetary benefits decreed by Labor Arbiter
Ricardo Olairez in favor oil private respondents.
At the outset, We declare petitioner guilty of forum shopping when it filed, despite the pendency
of G.R. 85939, Civil Case D9187 before the Regional Trial Court, Branch 40, Dagupan City. We
agree with the Solicitor General that the petition (G.R. 85939) and the action before the Regional
Trial Court involve "the same transactions, the same essential facts and circumstances":
In the action before the Regional Trial Court, as in the action before this Honorable
Court, the validity and legality of the proceedings in NLRC Case No. SUB-RAB-I-071-
86 and the propriety of implementing the decision therein against the petitioner were
the basic issues. So, too, the relief was basically the same: the prevention of such
implementation or execution. (p.130, Rollo, G.R. 85939)
In the case of Villanueva v. Adre (G.R. No. 80863, April 27, 1989, 172 SCRA 876), We stated:
There is forum-shopping whenever, as a result of an adverse opinion in one forum, a
party seeks a favorable opinion (other than by appeal or certiorari) in another. The
principle applies not only with respect to suits filed in the courts but also in connection
with litigations commenced in the courts while an administrative proceeding is
pending, as in this case, in order to defeat administrative processes and in anticipation
of an unfavorable administrative ruling and a favorable court ruling. This is specially
so, as in this case, where the court in which the second suit was brought, has no
jurisdiction. (at p. 882)
Corollarily, there is no question that in G.R. 86968, respondent judge acted without jurisdiction
and committed grave abuse of discretion in denying Olairez' motion to dismiss Civil Case D-
9187. It is basic that the RTC is not superior to but equal in rank with the NLRC and has no
jurisdiction to issue the restraining order against the execution of the NLRC decision dated June
10, 1987 (Imperial Vegetable Worker's Union, et al. v. Benjamin A. Vega, et al., G.R. Nos.
57005-07, November 23, 1988, 167 SCRA 601). Courts cannot enjoin execution of judgment
rendered by the National Labor Relations Commission (Villanueva v. Adre, supra).
Likewise explicit in Art. 254 of the Labor Code is the prohibition against courts or other entities
on the issuance of injunction or restraining order in cases involving or growing out of labor
disputes. In the cases of "Filipino Pipe Workers Union (NLU) v. Demetrio M. Batario, Jr., and
Filipino Pipe and Foundry Corp. v. NLRC, et al., (G.R. No. 75951, July 29, 1988; G.R. No.
79417, July 29, 1988, respectively, 163 SCRA 789). Chief Justice Fernan cautioned judges of
lower court in entertaining actions involving decisions, demands or orders of the Labor Arbiters
as well as the NLRC, particularly where the caption of the complaint is "Prohibition with
Preliminary Injunction" which is sufficient to put a judge on guard (supra, p. 796).
Civil Case D-9187 of RTC, Dagupan City, Branch 40 should thus be dismissed for lack of
jurisdiction.
On the issue of whether or not complainants' monetary claim had already prescribed and that
they are already barred from asserting the same, we shall not disturb the findings of fact by the
NLRC; i.e. that "complainant had sent a letter, dated June 17, 1985 to the Chairman of the
Board of Liquidators, asserting that "they wanted to avail of the benefits under BP 130, or the
payment of separation pay of 15 days for every year of service computed at the rate of their last
salary received" (p. 72, Rollo). We thus uphold their ruling that while the Pangasinan Review,
Inc.'s corporate charter expired on October 27, 1982, complainants' letter operates as an extra-
judicial demand within the three-year period and this interrupts the running of the pre- descriptive
period.
The proceedings in NLRC Case No. SUB-RAB-I-071-86 were therefore valid and legal.
As to private respondents' right to separation pay, Art. 283 (formerly Art. 284) as amended by
Sec. 15 of BP 130 is explicit:
Art. 283. Closure of establishment and reduction of personnel. — The employer may
also terminate the employment of any employee due to . . . the closing or cessation of
operation of the establishment or undertaking unless the closing is for the purpose of
circumventing the provisions of this Title, by serving a written notice on the workers
and the Ministry of Labor and Employment at least one (1) month before the intended
date thereof . . . In case of retrenchment to prevent losses and in cases of closures or
cessation of operations of establishment or undertaking not due to serious business
losses or financial reverses, the separation pay shall be equivalent to one (1) month
pay or at least one-half (1/2) month pay for every year of service, whichever is higher.
A fraction of at least six (6) months shall be considered one (1) whole year."
(Emphasis supplied)
Private respondents are, therefore, entitled to their claim for separation pay at the rate of one-
half (1/2) month's, pay for every year of their service, with a fraction of at least six (6) months
being considered as one whole year.
Moreover, pursuant to Art. 110 of the Labor Code as amended by RA 6715, whenever there is
liquidation proceedings, workers enjoy first preference as regards wages due them for services
rendered during the period including other monetary claims (DBP v. NLRC, et al. G.R. Nos.
82763-62, March 19, 1990, 183 SCRA 328), to be paid in full before claims of the government
and other creditors may be paid:
Worker preference in case of bankruptcy.* — In the event of bankruptcy, or liquidation
of an employer's business, his workers shall enjoy first preference as regards their
 wages and other monetary claims, any provisions of law to the contrary
notwithstanding. Such unpaid wages and monetary claims shall be paid in full before
claims of the government and other creditors may be paid.
On the question of whether the NLRC decision can legally be enforced against NPRI, it is clear
that NPRI is liable. Aside from being an assignee/transferee of the defunct PRI (pursuant to its
Resolution No. 1985-2 and the Deed of Assignment dated April 29, 1985), it categorically
assumed and undertook to "pay all the liabilities and obligations of the defunct Pangasinan
Review, Inc. (PRI) of every kind." The Resolution also stated that "claims against the defunct
Pangasinan Review, Inc. may be presented as long as the New Pangasinan Review, Inc.
exists."
We likewise agree with the Solicitor General that petitioner NPRI was not denied due process:
It is (sic) likewise cannot be disputed that petitioner took over the ownership,
management operations of the Pangasinan Review, Inc. As such, petitioner has for all
legal intents and purposes thus become the successor-employer of the private
respondents.
Moreover, the records show that prior to the issuance of the Special Order dated
November 3, 1988 (pp. 409-412, NLRC Record; Annex 'T' Petition), which ordered
that "satisfaction of the judgment shall be enforced against the remaining undisposed
assets of the defunct Pangasinan Review, Inc. and/or the New Pangasinan Review,
Inc. as the successor-employer," petitioner and counsels were notified of the
conference-hearing set for October 5, 1988, but that they refused to participate
therein (pp. 394-395, NLRC Record; Annex "S", Petition). (pp. 138-139, Rollo)
(Emphasis supplied).
ACCORDINGLY, in G.R. No. 85939, the NLRC decision is AFFIRMED and the petition
for certiorari is hereby DISMISSED. The temporary restraining order issued in said case is
hereby SET ASIDE.
In G.R. No. 86968, the writ of certiorari is GRANTED. Civil Case No. D-9187 in the Regional
Trial Court, Branch 40, Dagupan City is ordered DISMISSED for lack of jurisdiction of the said
court.
Mr. Renato C. Zabala and Atty. Felipe P. de Vera, Sr., are required to show cause why they
should not be held in contempt for having filed a complaint before the Regional Trial Court of
Dagupan City and the Ombudsman on the same issue raised in this petition seeking the same
prayer and relief. Atty. Felipe P. de Vera, Sr. is likewise directed to show cause why he should
not be suspended from the practice of law by reason of his having committed an act of forum
shopping, both within ten (10) days from receipt of this decision.
Double costs against private respondent New Pangasinan Review, Inc.
SO ORDERED.
G.R. No. L-35867 June 28, 1973
FRANCISCO A. ACHACOSO, in his own behalf and in behalf of Capital Insurance & Surety
Co., Inc.,
vs.
THE HON. COURT OF APPEALS, COTRAM, S.A., CAPITAL LIFE ASSURANCE CORP.,
JOAQUIN G. GARRIDO, respondents.
Rodrigo M. Nera for petitioner.
Norberto J. Quisumbing & R.P. Mosqueda for private respondent.
RESOLUTION
TEEHANKEE, J.:
The Court censures the practice of counsels who secure repeated extensions of time to file their
pleadings and thereafter simply let the period lapse without submitting the pleading or even an
explanation or manifestation of their failure to do so. The Court herein reprimands petitioner's
counsel for such misconduct with the warning that a repetition thereof will be dealt with more
severely.
Upon the filing on December 15, 1972 of the petition at bar for review of the Court of Appeals'
decision dismissing petitioner's petition for mandamus filed with said court to compel the Manila
court of first instance to allow petitioner's proposed appeal from its adverse judgment dismissing
plaintiff's complaint, the Court per its resolution of December 22, 1972 required respondents to
comment thereon.
Respondents filed on February 8, 1973 an extensive eighteen page comment and petitioner's
counsel, Rodrigo M. Nera, filed on February 12, 1973 a motion for leave to file reply within 15
days from notice alleging that there was need for such reply "in order that this Honorable Court
may be fully and completely informed of the nature of the controversy which gave rise to the
instant petition." The Court granted such leave per its resolution of February 23, 1973 and notice
of such leave was served on counsel on February 27, 1973.
On the last day for filing of the reply, viz, March 14, 1973 counsel asked for an additional 15
days averring that "due to the pressure of urgent professional work and daily trial engagements
of the undersigned counsel during the original period granted, he has not had sufficient material
time to complete the preparation of petitioner's reply." The Court granted the requested
extension per its resolution of March 20, 1973.
On the last day of the extended period for filing of the reply, viz, March 29, 1973 counsel again
asked for still another 15-day extension stating that "due to the pressure of urgent professional
work and daily trial engagements of the undersigned counsel, he has not had sufficient material
time to complete the preparation of petitioners reply. The undersigned counsel humbly
apologizes that in view of his crowded schedule, he has been constrained to ask for this
extension, but respectfully assures the Honorable Court that this will be the last one requested.'
As per its resolution of April 6, 1973, the Court granted counsel's motion for such third and last
extension.
The period for the filing of petitioner's reply lapsed on April 13, 1973 without counsel having filed
any reply manifestation explaining his failure to do so.
Accordingly, the Court in its resolution of May 24, 1973 denying the petition for review for lack of
merit, further required petitioner's counsel to show cause why discipline action should not be
taken against him for failure to file the reply after having obtained such leave and three
extensions time within which to do so.
Counsel filed in due course his verified Explanation dated June 7, 1973 stating that he was
retained in the ease "on a piece-work basis on the verbal understanding that all expenses for the
preparation of pleadings and the cost of services of stenographer-typist shall be furnished in
advance by petition upon being notified thereof," that when he asked for a third extension on
March 29, 1973, he so informed petitioner and requested him to remit the expenses for the
preparation of reply as per agreement" and that he tried to contact petitioner before the
expiration of the extended period but failed to do as petitioner "was then most of the time out of
his office."
Counsel relates that it was only on May 30, 1973 when he received notice of the Court's
resolution of May 24, 1973 denying the petition and requiring his explanation — long after the
expiration on April 13, 1973 of the extended period for the filing of the reply — that he wrote
petitioner and in turn asked the petitioner to explain the latter's failure to comply with his request
for a remittance of P500.00 to cover the necessary expenses, and that petitioner had replied that
counsel's letter had been misplaced by a clerk and hence, petitioner had "failure to act on the
same."
Counsel pleads that "this counsel has not the least intention of delaying the administration of
justice and much less trifle with the resolutions and orders of this Honorable Court. The inability
of this counsel to submit the reply within the extension granted by this Honorable Court was due
to supervening circumstances which could not be attributed to this counsel and that "if this poor
and humble practitioner has been impelled to inaction it surely was not intentional on his part,
the truth of the matter being that this counsel was just helpless in the face of petitioner's failure
to comply with his commitments aforesaid;" and that "this counsel deeply regrets this incident
and hereby apologizes to this Honorable Court for all his shortcomings relative to this case,
which after all were due to causes and circumstances not of his own making and far beyond his
control."
Counsel's explanation is far from satisfactory. If indeed he was not in a financial position to
advance the necessary expenses for preparing and submitting the reply, then he could have
filed timely the necessary manifestation that he was foregoing the filing of such reply on
petitioner's behalf. His inaction unduly delayed the Court's prompt disposition of the case after
the filing by respondents on February 8, 1973 of their comments on the petition showing its lack
of merit.
The Court would have then so disposed of the petition had it not been for petitioner's plea to be
given time and opportunity to file a reply to the comments in order to fully apprise the Court of
the nature of the controversy, which plea the Court granted in reliance on his good faith. Yet
after having obtained three extensions of time for the filing of the reply, counsel simply failed to
file any reply nor to give the Court the courtesy of any explanation or manifestation for his failure
to do so.
Counsel readily perceived in his explanation that his conduct comes close to delaying the
administration of justice and trifling with the Court's processes. It does not reflect well on
counsel's conduct as an officer of the Court that after assuring the Court that the third extension
requested by him "in view of his crowded schedule" and "of urgent professional work and daily
trial engagements" would be the last within which period he would at last file the awaited reply,
for him thereafter to let the period simply lapse without any explanation whatsoever, and worse,
to wait to be found out, and have the Court require him to explain.
Considering, however, that counsel's record shows no previous infractions on his part since his
admission to the Philippine Bar in 1953, the Court is disposed to be lenient in this instance.
ACCORDINGLY, the Court hereby administers a reprimand on Atty. Rodrigo M. Nera, with the
warning that a repetition of the same or similar acts shall be dealt with more severely. Let a copy
of this resolution be filed in his personal record.
G.R. No. 127876 December 17, 1999
ROXAS & CO., INC., petitioner,
vs.
THE HONORABLE COURT OF APPEALS, DEPARTMENT OF AGRARIAN REFORM,
SECRETARY OF AGRARIAN REFORM, DAR REGIONAL DIRECTOR FOR REGION IV,
MUNICIPAL AGRARIAN REFORM OFFICER OF NASUGBU, BATANGAS and
DEPARTMENT OF AGRARIAN REFORM ADJUDICATION BOARD, respondents.
PUNO, J.:
This case involves three (3) haciendas in Nasugbu, Batangas owned by petitioner and the
validity of the acquisition of these haciendas by the government under Republic Act No. 6657,
the Comprehensive Agrarian Reform Law of 1988.
Petitioner Roxas & Co. is a domestic corporation and is the registered owner of three haciendas,
namely, Haciendas Palico, Banilad and Caylaway, all located in the Municipality of Nasugbu,
Batangas. Hacienda Palico is 1,024 hectares in area and is registered under Transfer Certificate
of Title (TCT) No. 985. This land is covered by Tax Declaration Nos. 0465, 0466, 0468, 0470,
0234 and 0354. Hacienda Banilad is 1,050 hectares in area, registered under TCT No. 924 and
covered by Tax Declaration Nos. 0236, 0237 and 0390. Hacienda Caylaway is 867.4571
hectares in area and is registered under TCT Nos. T-44662, T-44663, T-44664 and T-44665.
The events of this case occurred during the incumbency of then President Corazon C. Aquino. In
February 1986, President Aquino issued Proclamation No. 3 promulgating a Provisional
Constitution. As head of the provisional government, the President exercised legislative power
"until a legislature is elected and convened under a new Constitution." 1 In the exercise of this
legislative power, the President signed on July 22, 1987, Proclamation No. 131 instituting a
Comprehensive Agrarian Reform Program and Executive Order No. 229 providing the
mechanisms necessary to initially implement the program.
On July 27, 1987, the Congress of the Philippines formally convened and took over legislative
power from the President. 2 This Congress passed Republic Act No. 6657, the Comprehensive
Agrarian Reform Law (CARL) of 1988. The Act was signed by the President on June 10, 1988
and took effect on June 15, 1988.
Before the law's effectivity, on May 6, 1988, petitioner filed with respondent DAR a voluntary
offer to sell Hacienda Caylaway pursuant to the provisions of E.O. No. 229. Haciendas Palico
and Banilad were later placed under compulsory acquisition by respondent DAR in accordance
with the CARL.
Hacienda Palico
On September 29, 1989, respondent DAR, through respondent Municipal Agrarian Reform
Officer (MARO) of Nasugbu, Batangas, sent a notice entitled "Invitation to Parties" to petitioner.
The Invitation was addressed to "Jaime Pimentel, Hda. Administrator, Hda. Palico." 3 Therein,
the MARO invited petitioner to a conference on October 6, 1989 at the DAR office in Nasugbu to
discuss the results of the DAR investigation of Hacienda Palico, which was "scheduled for
compulsory acquisition this year under the Comprehensive Agrarian Reform Program." 4
On October 25, 1989, the MARO completed three (3) Investigation Reports after investigation
and ocular inspection of the Hacienda. In the first Report, the MARO found that 270 hectares
under Tax Declaration Nos. 465, 466, 468 and 470 were "flat to undulating (0-8% slope)" and
actually occupied and cultivated by 34 tillers of sugarcane. 5 In the second Report, the MARO
identified as "flat to undulating" approximately 339 hectares under Tax Declaration No. 0234
which also had several actual occupants and tillers of sugarcane; 6 while in the third Report, the
MARO found approximately 75 hectare under Tax Declaration No. 0354 as "flat to undulating"
with 33 actual occupants and tillers also of sugarcane. 7
On October 27, 1989, a "Summary Investigation Report" was submitted and signed jointly by the
MARO, representatives of the Barangay Agrarian Reform Committee (BARC) and Land Bank of
the Philippines (LBP), and by the Provincial Agrarian Reform Officer (PARO). The Report
recommended that 333.0800 hectares of Hacienda Palico be subject to compulsory acquisition
at a value of P6,807,622.20. 8 The following day, October 28, 1989, two (2) more Summary
Investigation Reports were submitted by the same officers and representatives. They
recommended that 270.0876 hectares and 75.3800 hectares be placed under compulsory
acquisition at a compensation of P8,109,739.00 and P2,188,195.47, respectively. 9
On December 12, 1989, respondent DAR through then Department Secretary Miriam D.
Santiago sent a "Notice of Acquisition" to petitioner. The Notice was addressed as follows:
Roxas y Cia, Limited
Soriano Bldg., Plaza Cervantes
Manila, Metro Manila. 10
Petitioner was informed that 1,023.999 hectares of its land in Hacienda Palico were subject to
immediate acquisition and distribution by the government under the CARL; that based on the
DAR's valuation criteria, the government was offering compensation of P3.4 million for 333.0800
hectares; that whether this offer was to be accepted or rejected, petitioner was to inform the
Bureau of Land Acquisition and Distribution (BLAD) of the DAR; that in case of petitioner's
rejection or failure to reply within thirty days, respondent DAR shall conduct summary
administrative proceedings with notice to petitioner to determine just compensation for the land;
that if petitioner accepts respondent DAR's offer, or upon deposit of the compensation with an
accessible bank if it rejects the same, the DAR shall take immediate possession of the land. 11
Almost two years later, on September 26, 1991, the DAR Regional Director sent to the LBP
Land Valuation Manager three (3) separate Memoranda entitled "Request to Open Trust
Account." Each Memoranda requested that a trust account representing the valuation of three
portions of Hacienda Palico be opened in favor of the petitioner in view of the latter's rejection of
its offered value. 12
Meanwhile in a letter dated May 4, 1993, petitioner applied with the DAR for conversion of
Haciendas Palico and Banilad from agricultural to non-agricultural lands under the provisions of
the CARL. 13 On July 14, 1993, petitioner sent a letter to the DAR Regional Director reiterating its
request for conversion of the two haciendas. 14
Despite petitioner's application for conversion, respondent DAR proceeded with the acquisition
of the two Haciendas. The LBP trust accounts as compensation for Hacienda Palico were
replaced by respondent DAR with cash and LBP bonds. 15 On October 22, 1993, from the
mother title of TCT No. 985 of the Hacienda, respondent DAR registered Certificate of Land
Ownership Award (CLOA) No. 6654. On October 30, 1993, CLOA's were distributed to farmer
beneficiaries. 16
Hacienda Banilad
On August 23, 1989, respondent DAR, through respondent MARO of Nasugbu, Batangas, sent
a notice to petitioner addressed as follows:
Mr. Jaime Pimentel
Hacienda Administrator
Hacienda Banilad
Nasugbu, Batangas 17
The MARO informed Pimentel that Hacienda Banilad was subject to compulsory
acquisition under the CARL; that should petitioner wish to avail of the other schemes
such as Voluntary Offer to Sell or Voluntary Land Transfer, respondent DAR was
willing to provide assistance thereto. 18
On September 18, 1989, the MARO sent an "Invitation to Parties" again to Pimentel inviting the
latter to attend a conference on September 21, 1989 at the MARO Office in Nasugbu to discuss
the results of the MARO's investigation over Hacienda Banilad. 19
On September 21, 1989, the same day the conference was held, the MARO submitted two (2)
Reports. In his first Report, he found that approximately 709 hectares of land under Tax
Declaration Nos. 0237 and 0236 were "flat to undulating (0-8% slope)." On this area were
discovered 162 actual occupants and tillers of sugarcane. 20 In the second Report, it was found
that approximately 235 hectares under Tax Declaration No. 0390 were "flat to undulating," on
which were 92 actual occupants and tillers of sugarcane. 21
The results of these Reports were discussed at the conference. Present in the conference were
representatives of the prospective farmer beneficiaries, the BARC, the LBP, and Jaime Pimentel
on behalf of the landowner. 22 After the meeting, on the same day, September 21, 1989, a
Summary Investigation Report was submitted jointly by the MARO, representatives of the BARC,
LBP, and the PARO. They recommended that after ocular inspection of the property, 234.6498
hectares under Tax Declaration No. 0390 be subject to compulsory acquisition and distribution
by CLOA. 23 The following day, September 22, 1989, a second Summary Investigation was
submitted by the same officers. They recommended that 737.2590 hectares under Tax
Declaration Nos. 0236 and 0237 be likewise placed under compulsory acquisition for
distribution. 24
On December 12, 1989, respondent DAR, through the Department Secretary, sent to petitioner
two (2) separate "Notices of Acquisition" over Hacienda Banilad. These Notices were sent on the
same day as the Notice of Acquisition over Hacienda Palico. Unlike the Notice over Hacienda
Palico, however, the Notices over Hacienda Banilad were addressed to:
 Roxas y Cia. Limited
7th Floor, Cacho-Gonzales Bldg. 101 Aguirre St., Leg.
Makati, Metro Manila. 25
Respondent DAR offered petitioner compensation of P15,108,995.52 for 729.4190
hectares and P4,428,496.00 for 234.6498 hectares. 26
On September 26, 1991, the DAR Regional Director sent to the LBP Land Valuation Manager a
"Request to Open Trust Account" in petitioner's name as compensation for 234.6493 hectares of
Hacienda Banilad. 27 A second "Request to Open Trust Account" was sent on November 18,
1991 over 723.4130 hectares of said Hacienda. 28
On December 18, 1991, the LBP certified that the amounts of P4,428,496.40 and
P21,234,468.78 in cash and LBP bonds had been earmarked as compensation for petitioner's
land in Hacienda Banilad. 29
On May 4, 1993, petitioner applied for conversion of both Haciendas Palico and Banilad.
Hacienda Caylaway
Hacienda Caylaway was voluntarily offered for sale to the government on May 6, 1988 before
the effectivity of the CARL. The Hacienda has a total area of 867.4571 hectares and is covered
by four (4) titles — TCT Nos. T-44662, T-44663, T-44664 and T-44665. On January 12, 1989,
respondent DAR, through the Regional Director for Region IV, sent to petitioner two (2) separate
Resolutions accepting petitioner's voluntary offer to sell Hacienda Caylaway, particularly TCT
Nos. T-44664 and T-44663. 30 The Resolutions were addressed to:
Roxas & Company, Inc.
7th Flr. Cacho-Gonzales Bldg.
Aguirre, Legaspi Village
Makati, M. M 31
On September 4, 1990, the DAR Regional Director issued two separate Memoranda to the LBP
Regional Manager requesting for the valuation of the land under TCT Nos. T-44664 and T-
44663. 32 On the same day, respondent DAR, through the Regional Director, sent to petitioner a
"Notice of Acquisition" over 241.6777 hectares under TCT No. T-44664 and 533.8180 hectares
under TCT No. T-44663. 33 Like the Resolutions of Acceptance, the Notice of Acquisition was
addressed to petitioner at its office in Makati, Metro Manila.
Nevertheless, on August 6, 1992, petitioner, through its President, Eduardo J. Roxas, sent a
letter to the Secretary of respondent DAR withdrawing its VOS of Hacienda Caylaway. The
Sangguniang Bayan of Nasugbu, Batangas allegedly authorized the reclassification of Hacienda
Caylaway from agricultural to non-agricultural. As a result, petitioner informed respondent DAR
that it was applying for conversion of Hacienda Caylaway from agricultural to other
uses. 34
In a letter dated September 28, 1992, respondent DAR Secretary informed petitioner that a
reclassification of the land would not exempt it from agrarian reform. Respondent Secretary also
denied petitioner's withdrawal of the VOS on the ground that withdrawal could only be based on
specific grounds such as unsuitability of the soil for agriculture, or if the slope of the land is over
18 degrees and that the land is undeveloped. 35
Despite the denial of the VOS withdrawal of Hacienda Caylaway, on May 11, 1993, petitioner
filed its application for conversion of both Haciendas Palico and Banilad. 36 On July 14, 1993,
petitioner, through its President, Eduardo Roxas, reiterated its request to withdraw the VOS over
Hacienda Caylaway in light of the following:
1) Certification issued by Conrado I. Gonzales, Officer-in-Charge,
Department of Agriculture, Region 4, 4th Floor, ATI (BA) Bldg., Diliman,
Quezon City dated March 1, 1993 stating that the lands subject of
referenced titles "are not feasible and economically sound for further
agricultural development.
2) Resolution No. 19 of the Sangguniang Bayan of Nasugbu, Batangas
approving the Zoning Ordinance reclassifying areas covered by the
referenced titles to non-agricultural which was enacted after extensive
consultation with government agencies, including [the Department of
Agrarian Reform], and the requisite public hearings.
3) Resolution No. 106 of the Sangguniang Panlalawigan of Batangas dated
March 8, 1993 approving the Zoning Ordinance enacted by the Municipality
of Nasugbu.
4) Letter dated December 15, 1992 issued by Reynaldo U. Garcia of the
Municipal Planning & Development, Coordinator and Deputized Zoning
Administrator addressed to Mrs. Alicia P. Logarta advising that the
Municipality of Nasugbu, Batangas has no objection to the conversion of the
lands subject of referenced titles to non-agricultural. 37
On August 24, 1993 petitioner instituted Case No. N-0017-96-46 (BA) with respondent DAR
Adjudication Board (DARAB) praying for the cancellation of the CLOA's issued by respondent
DAR in the name of several persons. Petitioner alleged that the Municipality of Nasugbu, where
the haciendas are located, had been declared a tourist zone, that the land is not suitable for
agricultural production, and that the Sangguniang Bayan of Nasugbu had reclassified the land to
non-agricultural.
In a Resolution dated October 14, 1993, respondent DARAB held that the case involved the
prejudicial question of whether the property was subject to agrarian reform, hence, this question
should be submitted to the Office of the Secretary of Agrarian Reform for determination. 38
On October 29, 1993, petitioner filed with the Court of Appeals CA-G.R. SP No. 32484. It
questioned the expropriation of its properties under the CARL and the denial of due process in
the acquisition of its landholdings.
Meanwhile, the petition for conversion of the three haciendas was denied by the MARO on
November 8, 1993.
Petitioner's petition was dismissed by the Court of Appeals on April 28, 1994. 39 Petitioner
moved for reconsideration but the motion was denied on January 17, 1997 by respondent
court. 40
Hence, this recourse. Petitioner assigns the following errors:
A. RESPONDENT COURT OF APPEALS GRAVELY ERRED IN HOLDING
THAT PETITIONER'S CAUSE OF ACTION IS PREMATURE FOR
FAILURE TO EXHAUST ADMINISTRATIVE REMEDIES IN VIEW OF THE
PATENT ILLEGALITY OF THE RESPONDENTS' ACTS, THE
IRREPARABLE DAMAGE CAUSED BY SAID ILLEGAL ACTS, AND THE
ABSENCE OF A PLAIN, SPEEDY AND ADEQUATE REMEDY IN THE
ORDINARY COURSE OF LAW — ALL OF WHICH ARE EXCEPTIONS TO
THE SAID DOCTRINE.
B. RESPONDENT COURT OF APPEALS GRAVELY ERRED IN HOLDING
THAT PETITIONER'S LANDHOLDINGS ARE SUBJECT TO COVERAGE
UNDER THE COMPREHENSIVE AGRARIAN REFORM LAW, IN VIEW OF
THE UNDISPUTED FACT THAT PETITIONER'S LANDHOLDINGS HAVE
BEEN CONVERTED TO NON-AGRICULTURAL USES BY PRESIDENTIAL
PROCLAMATION NO. 1520 WHICH DECLARED THE MUNICIPALITY
NASUGBU, BATANGAS AS A TOURIST ZONE, AND THE ZONING
ORDINANCE OF THE MUNICIPALITY OF NASUGBU RE-CLASSIFYING
CERTAIN PORTIONS OF PETITIONER'S LANDHOLDINGS AS NON-
AGRICULTURAL, BOTH OF WHICH PLACE SAID LANDHOLDINGS
OUTSIDE THE SCOPE OF AGRARIAN REFORM, OR AT THE VERY
LEAST ENTITLE PETITIONER TO APPLY FOR CONVERSION AS
CONCEDED BY RESPONDENT DAR.
In its first assigned error, petitioner claims that respondent Court of Appeals gravely erred in
finding that petitioner failed to exhaust administrative remedies. As a general rule, before a party
may be allowed to invoke the jurisdiction of the courts of justice, he is expected to have
exhausted all means of administrative redress. This is not absolute, however. There are
instances when judicial action may be resorted to immediately. Among these exceptions are: (1)
when the question raised is purely legal; (2) when the administrative body is in estoppel; (3)
when the act complained of is patently illegal; (4) when there is urgent need for judicial
intervention; (5) when the respondent acted in disregard of due process; (6) when the
respondent is a department secretary whose acts, as an alter ego of the President, bear the
implied or assumed approval of the latter; (7) when irreparable damage will be suffered; (8)
when there is no other plain, speedy and adequate remedy; (9) when strong public interest is
involved; (10) when the subject of the controversy is private land; and (11) in quo
warranto proceedings. 42
Petitioner rightly sought immediate redress in the courts. There was a violation of its rights and
to require it to exhaust administrative remedies before the DAR itself was not a plain, speedy
and adequate remedy.
Respondent DAR issued Certificates of Land Ownership Award (CLOA's) to farmer beneficiaries
over portions of petitioner's land without just compensation to petitioner. A Certificate of Land
Ownership Award (CLOA) is evidence of ownership of land by a beneficiary under R.A. 6657,
the Comprehensive Agrarian Reform Law of 1988. 43 Before this may be awarded to a farmer
beneficiary, the land must first be acquired by the State from the landowner and ownership
transferred to the former. The transfer of possession and ownership of the land to the
government are conditioned upon the receipt by the landowner of the corresponding payment or
deposit by the DAR of the compensation with an accessible bank. Until then, title remains with
the landowner. 44 There was no receipt by petitioner of any compensation for any of the lands
acquired by the government.

The kind of compensation to be paid the landowner is also specific. The law provides that the
C. RESPONDENT COURT OF APPEALS GRAVELY ERRED WHEN IT
deposit must be made only in "cash" or "LBP bonds." 45 Respondent DAR's opening of trust
FAILED TO DECLARE THE PROCEEDINGS BEFORE RESPONDENT
account deposits in petitioner' s name with the Land Bank of the Philippines does not constitute
DAR VOID FOR FAILURE TO OBSERVE DUE PROCESS, CONSIDERING
payment under the law. Trust account deposits are not cash or LBP bonds. The replacement of
THAT RESPONDENTS BLATANTLY DISREGARDED THE PROCEDURE
the trust account with cash or LBP bonds did not ipso facto cure the lack of compensation; for
FOR THE ACQUISITION OF PRIVATE LANDS UNDER R.A. 6657, MORE
essentially, the determination of this compensation was marred by lack of due process. In fact, in
PARTICULARLY, IN FAILING TO GIVE DUE NOTICE TO THE
the entire acquisition proceedings, respondent DAR disregarded the basic requirements of
PETITIONER AND TO PROPERLY IDENTIFY THE SPECIFIC AREAS
administrative due process. Under these circumstances, the issuance of the CLOA's to farmer
SOUGHT TO BE ACQUIRED.
beneficiaries necessitated immediate judicial action on the part of the petitioner.

D. RESPONDENT COURT OF APPEALS GRAVELY ERRED WHEN IT

II. The Validity of the Acquisition Proceedings Over the Haciendas.
FAILED TO RECOGNIZE THAT PETITIONER WAS BRAZENLY AND
ILLEGALLY DEPRIVED OF ITS PROPERTY WITHOUT JUST
COMPENSATION, CONSIDERING THAT PETITIONER WAS NOT PAID Petitioner's allegation of lack of due process goes into the validity of the acquisition proceedings
JUST COMPENSATION BEFORE IT WAS UNCEREMONIOUSLY themselves. Before we rule on this matter, however, there is need to lay down the procedure in
STRIPPED OF ITS LANDHOLDINGS THROUGH THE ISSUANCE OF the acquisition of private lands under the provisions of the law.
CLOA'S TO ALLEGED FARMER BENEFICIARIES, IN VIOLATION OF R.A.
6657. 41
A. Modes of Acquisition of Land under R. A. 6657

The assigned errors involve three (3) principal issues: (1) whether this Court can take
Republic Act No. 6657, the Comprehensive Agrarian Reform Law of 1988 (CARL), provides for
cognizance of this petition despite petitioner's failure to exhaust administrative remedies; (2)
two (2) modes of acquisition of private land: compulsory and voluntary. The procedure for the
whether the acquisition proceedings over the three haciendas were valid and in accordance with
compulsory acquisition of private lands is set forth in Section 16 of R.A. 6657, viz:
law; and (3) assuming the haciendas may be reclassified from agricultural to non-agricultural,
whether this court has the power to rule on this issue.
Sec. 16. Procedure for Acquisition of Private Lands. — For purposes of
acquisition of private lands, the following procedures shall be followed:
I. Exhaustion of Administrative Remedies.
 a). After having identified the land, the landowners and
the beneficiaries, the DAR shall send its notice to
acquire the land to the owners thereof, by personal
delivery or registered mail, and post the same in a
conspicuous place in the municipal building and
barangay hall of the place where the property is
located. Said notice shall contain the offer of the DAR
to pay a corresponding value in accordance with the
valuation set forth in Sections 17, 18, and other
pertinent provisions hereof.
b) Within thirty (30) days from the date of receipt of
written notice by personal delivery or registered mail,
the landowner, his administrator or representative shall
inform the DAR of his acceptance or rejection of the
offer.
located. Within thirty days from receipt of the Notice of Acquisition, the landowner, his
administrator or representative shall inform the DAR of his acceptance or rejection of the offer. If
the landowner accepts, he executes and delivers a deed of transfer in favor of the government
and surrenders the certificate of title. Within thirty days from the execution of the deed of
transfer, the Land Bank of the Philippines (LBP) pays the owner the purchase price. If the
landowner rejects the DAR's offer or fails to make a reply, the DAR conducts summary
administrative proceedings to determine just compensation for the land. The landowner, the LBP
representative and other interested parties may submit evidence on just compensation within
fifteen days from notice. Within thirty days from submission, the DAR shall decide the case and
inform the owner of its decision and the amount of just compensation. Upon receipt by the owner
of the corresponding payment, or, in case of rejection or lack of response from the latter, the
DAR shall deposit the compensation in cash or in LBP bonds with an accessible bank. The DAR
shall immediately take possession of the land and cause the issuance of a transfer certificate of
title in the name of the Republic of the Philippines. The land shall then be redistributed to the
farmer beneficiaries. Any party may question the decision of the DAR in the regular courts for
final determination of just compensation.

The DAR has made compulsory acquisition the priority mode of the land acquisition to hasten
c) If the landowner accepts the offer of the DAR, the
the implementation of the Comprehensive Agrarian Reform Program (CARP). 46 Under Section
LBP shall pay the landowner the purchase price of the
16 of the CARL, the first step in compulsory acquisition is the identification of the land, the
land within thirty (30) days after he executes and
landowners and the beneficiaries. However, the law is silent on how the identification process
delivers a deed of transfer in favor of the Government
must be made. To fill in this gap, the DAR issued on July 26, 1989 Administrative Order
and surrenders the Certificate of Title and other
No. 12, Series or 1989, which set the operating procedure in the identification of such lands. The
muniments of title.
procedure is as follows:

d) In case of rejection or failure to reply, the DAR shall

II. OPERATING PROCEDURE
conduct summary administrative proceedings to
determine the compensation for the land requiring the
landowner, the LBP and other interested parties to A. The Municipal Agrarian Reform Officer, with the assistance of the
submit evidence as to the just compensation for the pertinent Barangay Agrarian Reform Committee (BARC), shall:
land, within fifteen (15) days from receipt of the notice.
After the expiration of the above period, the matter is
1. Update the masterlist of all agricultural lands covered
deemed submitted for decision. The DAR shall decide
under the CARP in his area of responsibility. The
the case within thirty (30) days after it is submitted for
masterlist shall include such information as required
decision.
under the attached CARP Masterlist Form which shall
include the name of the landowner, landholding area,
e) Upon receipt by the landowner of the corresponding TCT/OCT number, and tax declaration number.
payment, or, in case of rejection or no response from
the landowner, upon the deposit with an accessible
2. Prepare a Compulsory Acquisition Case Folder
bank designated by the DAR of the compensation in
(CACF) for each title (OCT/TCT) or landholding covered
cash or in LBP bonds in accordance with this Act, the
under Phase I and II of the CARP except those for
DAR shall take immediate possession of the land and
which the landowners have already filed applications to
shall request the proper Register of Deeds to issue a
avail of other modes of land acquisition. A case folder
Transfer Certificate of Title (TCT) in the name of the
shall contain the following duly accomplished forms:
Republic of the Philippines. The DAR shall thereafter
proceed with the redistribution of the land to the
qualified beneficiaries. a) CARP CA Form 1 — MARO
Investigation Report
f) Any party who disagrees with the decision may bring
the matter to the court of proper jurisdiction for final b) CARP CA Form 2 — Summary
determination of just compensation. Investigation Report of Findings
and Evaluation
In the compulsory acquisition of private lands, the landholding, the landowners and the farmer
beneficiaries must first be identified. After identification, the DAR shall send a Notice of c) CARP CA Form 3 — Applicant's
Acquisition to the landowner, by personal delivery or registered mail, and post it in a Information Sheet
conspicuous place in the municipal building and barangay hall of the place where the property is
 d) CARP CA Form 4 —
Beneficiaries Undertaking
e) CARP CA Form 5 — Transmittal
Report to the PARO
The MARO/BARC shall certify that all information
contained in the above-mentioned forms have been
examined and verified by him and that the same are
true and correct.
3. Send a Notice of Coverage and a letter of invitation
to a conference/meeting to the landowner covered by
the Compulsory Case Acquisition Folder. Invitations to
the said conference/meeting shall also be sent to the
prospective farmer-beneficiaries, the BARC
representative(s), the Land Bank of the Philippines
(LBP) representative, and other interested parties to
discuss the inputs to the valuation of the property. He
shall discuss the MARO/BARC investigation report and
solicit the views, objection, agreements or suggestions
of the participants thereon. The landowner shall also be
asked to indicate his retention area. The minutes of the
meeting shall be signed by all participants in the
conference and shall form an integral part of the CACF.
4. Submit all completed case folders to the Provincial
Agrarian Reform Officer (PARO).
B. The PARO shall:
1. Ensure that the individual case folders are forwarded
to him by his MAROs.
2. Immediately upon receipt of a case folder, compute
the valuation of the land in accordance with A.O. No. 6,
Series of 1988. 47 The valuation worksheet and the
related CACF valuation forms shall be duly certified
correct by the PARO and all the personnel who
participated in the accomplishment of these forms.
3. In all cases, the PARO may validate the report of the
MARO through ocular inspection and verification of the
property. This ocular inspection and verification shall be
mandatory when the computed value exceeds =
500,000 per estate.
4. Upon determination of the valuation, forward the
case folder, together with the duly accomplished
valuation forms and his recommendations, to the
Central Office. The LBP representative and the MARO
concerned shall be furnished a copy each of his report.
C. DAR Central Office, specifically through the Bureau
of Land Acquisition and Distribution (BLAD), shall:
1. Within three days from receipt of the case folder from
the PARO, review, evaluate and determine the final
land valuation of the property covered by the case
folder. A summary review and evaluation report shall be
prepared and duly certified by the BLAD Director and
the personnel directly participating in the review and
final valuation.
2. Prepare, for the signature of the Secretary or her
duly authorized representative, a Notice of Acquisition
(CARP CA Form 8) for the subject property. Serve the
Notice to the landowner personally or through
registered mail within three days from its approval. The
Notice shall include, among others, the area subject of
compulsory acquisition, and the amount of just
compensation offered by DAR.
3. Should the landowner accept the DAR's offered
value, the BLAD shall prepare and submit to the
Secretary for approval the Order of Acquisition.
However, in case of rejection or non-reply, the DAR
Adjudication Board (DARAB) shall conduct a summary
administrative hearing to determine just compensation,
in accordance with the procedures provided under
Administrative Order No. 13, Series of 1989.
Immediately upon receipt of the DARAB's decision on
just compensation, the BLAD shall prepare and submit
to the Secretary for approval the required Order of
Acquisition.
4. Upon the landowner's receipt of payment, in case of
acceptance, or upon deposit of payment in the
designated bank, in case of rejection or non-response,
the Secretary shall immediately direct the pertinent
Register of Deeds to issue the corresponding Transfer
Certificate of Title (TCT) in the name of the Republic of
the Philippines. Once the property is transferred, the
DAR, through the PARO, shall take possession of the
land for redistribution to qualified beneficiaries.
Administrative Order No. 12, Series of 1989 requires that the Municipal Agrarian Reform Officer
(MARO) keep an updated master list of all agricultural lands under the CARP in his area of
responsibility containing all the required information. The MARO prepares a Compulsory
Acquisition Case Folder (CACF) for each title covered by CARP. The MARO then sends the
landowner a "Notice of Coverage" and a "letter of invitation" to a "conference/meeting" over the
land covered by the CACF. He also sends invitations to the prospective farmer-beneficiaries the
representatives of the Barangay Agrarian Reform Committee (BARC), the Land Bank of the
Philippines (LBP) and other interested parties to discuss the inputs to the valuation of the
property and solicit views, suggestions, objections or agreements of the parties. At the meeting,
the landowner is asked to indicate his retention area.
The MARO shall make a report of the case to the Provincial Agrarian Reform Officer (PARO)
who shall complete the valuation of the land. Ocular inspection and verification of the property by
the PARO shall be mandatory when the computed value of the estate exceeds P500,000.00.
Upon determination of the valuation, the PARO shall forward all papers together with his
recommendation to the Central Office of the DAR. The DAR Central Office, specifically, the
Bureau of Land Acquisition and Distribution (BLAD), shall review, evaluate and determine the
final land valuation of the property. The BLAD shall prepare, on the signature of the Secretary or
his duly authorized representative, a Notice of Acquisition for the subject property. 48 From this
point, the provisions of Section 16 of R.A. 6657 then apply. 49
For a valid implementation of the CAR program, two notices are required: (1) the Notice of
Coverage and letter of invitation to a preliminary conference sent to the landowner, the
representatives of the BARC, LBP, farmer beneficiaries and other interested parties pursuant to
DAR A.O. No. 12, Series of 1989; and (2) the Notice of Acquisition sent to the landowner under
Section 16 of the CARL.
The importance of the first notice, i.e., the Notice of Coverage and the letter of invitation to the
conference, and its actual conduct cannot be understated. They are steps designed to comply
with the requirements of administrative due process. The implementation of the CARL is an
exercise of the State's police power and the power of eminent domain. To the extent that the
CARL prescribes retention limits to the landowners, there is an exercise of police power for the
regulation of private property in accordance with the Constitution. 50 But where, to carry out such
regulation, the owners are deprived of lands they own in excess of the maximum area allowed,
there is also a taking under the power of eminent domain. The taking contemplated is not a mere
limitation of the use of the land. What is required is the surrender of the title to and physical
possession of the said excess and all beneficial rights accruing to the owner in favor of the
farmer beneficiary. 51 The Bill of Rights provides that "[n]o person shall be deprived of life, liberty
or property without due process of law." 52 The CARL was not intended to take away property
without due process of law. 53 The exercise of the power of eminent domain requires that due
process be observed in the taking of private property.
DAR A.O. No. 12, Series of 1989, from whence the Notice of Coverage first sprung, was
amended in 1990 by DAR A.O. No. 9, Series of 1990 and in 1993 by DAR A.O. No. 1, Series of
1993. The Notice of Coverage and letter of invitation to the conference meeting were expanded
and amplified in said amendments.
DAR A.O. No. 9, Series of 1990 entitled "Revised Rules Governing the Acquisition of Agricultural
Lands Subject of Voluntary Offer to Sell and Compulsory Acquisition Pursuant to R.A. 6657,"
requires that:
B. MARO
1. Receives the duly accomplished CARP Form Nos. 1 & 1.1 including supporting documents.
2. Gathers basic ownership documents listed under 1.a or 1.b above and prepares
corresponding VOCF/CACF by landowner/landholding.
3. Notifies/invites the landowner and representatives of the LBP, DENR, BARC and prospective
beneficiaries of the schedule of ocular inspection of the property at least one week in advance.
4. MARO/LAND BANK FIELD OFFICE/BARC
a) Identify the land and landowner, and determine the suitability for agriculture and productivity
of the land and jointly prepare Field Investigation Report (CARP Form No. 2), including the Land
Use Map of the property.
b) Interview applicants and assist them in the preparation of the Application For Potential CARP
Beneficiary (CARP Form No. 3).
c) Screen prospective farmer-beneficiaries and for those found qualified, cause the signing of
the respective Application to Purchase and Farmer's Undertaking (CARP Form No. 4).
d) Complete the Field Investigation Report based on the result of the ocular
inspection/investigation of the property and documents submitted. See to it that Field
Investigation Report is duly accomplished and signed by all concerned.
5. MARO
a) Assists the DENR Survey Party in the conduct of a boundary/ subdivision survey delineating
areas covered by OLT, retention, subject of VOS, CA (by phases, if possible), infrastructures,
etc., whichever is applicable.
b) Sends Notice of Coverage (CARP Form No. 5) to landowner concerned or his duly authorized
representative inviting him for a conference.
c) Sends Invitation Letter (CARP Form No. 6) for a conference/public hearing to prospective
farmer-beneficiaries, landowner, representatives of BARC, LBP, DENR, DA, NGO's, farmers'
organizations and other interested parties to discuss the following matters:
Result of Field Investigation
Inputs to valuation
Issues raised Comments/recommendations by all parties concerned.
d) Prepares Summary of Minutes of the conference/public hearing to be guided by CARP Form
No. 7.
e) Forwards the completed VOCF/CACF to the Provincial Agrarian Reform Office (PARO) using
CARP Form No. 8 (Transmittal Memo to PARO).
xxx xxx xxx
DAR A.O. No. 9, Series of 1990 lays down the rules on both Voluntary Offer to Sell (VOS) and
Compulsory Acquisition (CA) transactions involving lands enumerated under Section 7 of the
CARL. 54 In both VOS and CA. transactions, the MARO prepares the Voluntary Offer to Sell
Case Folder (VOCF) and the Compulsory Acquisition Case Folder (CACF), as the case may be,
over a particular landholding. The MARO notifies the landowner as well as representatives of the
LBP, BARC and prospective beneficiaries of the date of the ocular inspection of the property at
least one week before the scheduled date and invites them to attend the same. The MARO, LBP
or BARC conducts the ocular inspection and investigation by identifying the land and landowner, his retention area, if he desires
determining the suitability of the land for agriculture and productivity, interviewing and screening
prospective farmer beneficiaries. Based on its investigation, the MARO, LBP or BARC prepares
to avail of his right of retention;
the Field Investigation Report which shall be signed by all parties concerned. In addition to the
field investigation, a boundary or subdivision survey of the land may also be conducted by a
Survey Party of the Department of Environment and Natural Resources (DENR) to be assisted and at the same time invites him
by the MARO. 55 This survey shall delineate the areas covered by Operation Land Transfer
(OLT), areas retained by the landowner, areas with infrastructure, and the areas subject to VOS
and CA. After the survey and field investigation, the MARO sends a "Notice of Coverage" to the to join the field investigation to
landowner or his duly authorized representative inviting him to a conference or public hearing
with the farmer beneficiaries, representatives of the BARC, LBP, DENR, Department of be conducted on his property
Agriculture (DA), non-government organizations, farmer's organizations and other interested
parties. At the public hearing, the parties shall discuss the results of the field investigation,
issues that may be raised in relation thereto, inputs to the valuation of the subject landholding, which should be scheduled at
and other comments and recommendations by all parties concerned. The Minutes of the
conference/public hearing shall form part of the VOCF or CACF which files shall be forwarded by least two weeks in advance of
the MARO to the PARO. The PARO reviews, evaluates and validates the Field Investigation
Report and other documents in the VOCF/CACF. He then forwards the records to the RARO for
another review. said notice.

DAR A.O. No. 9, Series of 1990 was amended by DAR A.O. No. 1, Series of 1993. DAR A.O. A copy of said Notice shall CARP
No. 1, Series of 1993 provided, among others, that:
be posted for at least one Form No. 17
IV. OPERATING PROCEDURES:
week on the bulletin board of
Steps Responsible Activity Forms/
the municipal and barangay
Agency/Unit Document
halls where the property is
(requirements)
located. LGU office concerned
A. Identification and
notifies DAR about compliance
Documentation
with posting requirements thru
xxx xxx xxx
return indorsement on CARP
5 DARMO Issue Notice of Coverage CARP
Form No. 17.
to LO by personal delivery Form No. 2
6 DARMO Send notice to the LBP, CARP
with proof of service, or
BARC, DENR representatives Form No. 3
registered mail with return
and prospective ARBs of the schedule of the field investigation
card, informing him that his
to be conducted on the subject
property is now under CARP
property.
coverage and for LO to select
7 DARMO With the participation of CARP Part I of CARP Form No. 4 shall

BARC the LO, representatives of Form No. 4 be forwarded to the LBP

LBP the LBP, BARC, DENR Land Use representative for validation. If he agrees

DENR and prospective ARBs, Map to the ocular inspection report of DAR,

Local Office conducts the investigation on he signs the FIR (Part I) and

subject property to identify accomplishes Part II thereof.

the landholding, determines In the event that there is a

its suitability and productivity; difference or variance between

and jointly prepares the Field the findings of the DAR and the

Investigation Report (FIR) LBP as to the propriety of

and Land Use Map. However, covering the land under CARP,

the field investigation shall whether in whole or in part, on

proceed even if the LO, the the issue of suitability to agriculture,

representatives of the DENR and degree of development or slope,

prospective ARBs are not available and on issues affecting idle lands,

provided, they were given due the conflict shall be resolved by

notice of the time and date of a composite team of DAR, LBP,

investigation to be conducted. DENR and DA which shall jointly

Similarly, if the LBP representative conduct further investigation

is not available or could not come thereon. The team shall submit its

on the scheduled date, the field report of findings which shall be

investigation shall also be conducted, binding to both DAR and LBP,

after which the duly accomplished pursuant to Joint Memorandum

Circular of the DAR, LBP, DENR
and DA dated 27 January 1992.
8 DARMO Screen prospective ARBs
BARC and causes the signing of CARP
the Application of Purchase Form No. 5
and Farmer's Undertaking
(APFU).
9 DARMO Furnishes a copy of the CARP
duly accomplished FIR to Form No. 4
the landowner by personal
delivery with proof of
service or registered mail
will return card and posts
a copy thereof for at least
one week on the bulletin
board of the municipal
and barangay halls where
the property is located.
LGU office concerned CARP
notifies DAR about Form No. 17
compliance with posting
requirement thru return
endorsement on CARP
Form No. 17.
B. Land Survey
10 DARMO Conducts perimeter or Perimeter
And/or segregation survey or
DENR delineating areas covered Segregation
Local Office by OLT, "uncarpable Survey Plan
areas such as 18% slope
and above, unproductive/
unsuitable to agriculture,
retention, infrastructure.
In case of segregation or
subdivision survey, the
plan shall be approved
by DENR-LMS.
C. Review and Completion
of Documents
11. DARMO Forward VOCF/CACF CARP
to DARPO. Form No. 6
xxx xxx xxx.
DAR A.O. No. 1, Series of 1993, modified the identification process and increased the number of
government agencies involved in the identification and delineation of the land subject to
acquisition. 56 This time, the Notice of Coverage is sent to the landowner before the conduct of
the field investigation and the sending must comply with specific requirements. Representatives
of the DAR Municipal Office (DARMO) must send the Notice of Coverage to the landowner by
"personal delivery with proof of service, or by registered mail with return card," informing him that
his property is under CARP coverage and that if he desires to avail of his right of retention, he
may choose which area he shall retain. The Notice of Coverage shall also invite the landowner
to attend the field investigation to be scheduled at least two weeks from notice. The field
investigation is for the purpose of identifying the landholding and determining its suitability for
agriculture and its productivity. A copy of the Notice of Coverage shall be posted for at least one
week on the bulletin board of the municipal and barangay halls where the property is located.
The date of the field investigation shall also be sent by the DAR Municipal Office to
representatives of the LBP, BARC, DENR and prospective farmer beneficiaries. The field
investigation shall be conducted on the date set with the participation of the landowner and the
various representatives. If the landowner and other representatives are absent, the field
investigation shall proceed, provided they were duly notified thereof. Should there be a variance
between the findings of the DAR and the LBP as to whether the land be placed under agrarian
reform, the land's suitability to agriculture, the degree or development of the slope, etc., the
conflict shall be resolved by a composite team of the DAR, LBP, DENR and DA which shall
jointly conduct further investigation. The team's findings shall be binding on both DAR and LBP.
After the field investigation, the DAR Municipal Office shall prepare the Field Investigation
Report and Land Use Map, a copy of which shall be furnished the landowner "by personal
delivery with proof of service or registered mail with return card." Another copy of the Report and
Map shall likewise be posted for at least one week in the municipal or barangay halls where the
property is located.
Clearly then, the notice requirements under the CARL are not confined to the Notice of
Acquisition set forth in Section 16 of the law. They also include the Notice of Coverage first laid
down in DAR A.O. No. 12, Series of 1989 and subsequently amended in DAR A.O. No. 9, Series
of 1990 and DAR A.O. No. 1, Series of 1993. This Notice of Coverage does not merely notify the
landowner that his property shall be placed under CARP and that he is entitled to exercise his
retention right; it also notifies him, pursuant to DAR A.O. No. 9, Series of 1990, that a public
hearing, shall be conducted where he and representatives of the concerned sectors of society
may attend to discuss the results of the field investigation, the land valuation and other pertinent
matters. Under DAR A.O. No. 1, Series of 1993, the Notice of Coverage also informs the
landowner that a field investigation of his landholding shall be conducted where he and the other
representatives may be present.
B. The Compulsory Acquisition of Haciendas Palico and Banilad
In the case at bar, respondent DAR claims that it, through MARO Leopoldo C. Lejano, sent a
letter of invitation entitled "Invitation to Parties" dated September 29, 1989 to petitioner
corporation, through Jaime Pimentel, the administrator of Hacienda Palico. 57 The invitation was
received on the same day it was sent as indicated by a signature and the date received at the
bottom left corner of said invitation. With regard to Hacienda Banilad, respondent DAR claims
that Jaime Pimentel, administrator also of Hacienda Banilad, was notified and sent an invitation
to the conference. Pimentel actually attended the conference on September 21, 1989 and
signed the Minutes of the meeting on behalf of petitioner corporation. 58 The Minutes was also
signed by the representatives of the BARC, the LBP and farmer beneficiaries. 59 No letter of
invitation was sent or conference meeting held with respect to Hacienda Caylaway because it
was subject to a Voluntary Offer to Sell to respondent DAR. 60
When respondent DAR, through the Municipal Agrarian Reform Officer (MARO), sent to the
various parties the Notice of Coverage and invitation to the conference, DAR A.O. No. 12, Series
of 1989 was already in effect more than a month earlier. The Operating Procedure in DAR
Administrative Order No. 12 does not specify how notices or letters of invitation shall be sent to
the landowner, the representatives of the BARC, the LBP, the farmer beneficiaries and other
interested parties. The procedure in the sending of these notices is important to comply with the
requisites of due process especially when the owner, as in this case, is a juridical entity.
Petitioner is a domestic
corporation, 61 and therefore, has a personality separate and distinct from its shareholders,
officers and employees.
The Notice of Acquisition in Section 16 of the CARL is required to be sent to the landowner by
"personal delivery or registered mail." Whether the landowner be a natural or juridical person to
whose address the Notice may be sent by personal delivery or registered mail, the law does not
distinguish. The DAR Administrative Orders also do not distinguish. In the proceedings before
the DAR, the distinction between natural and juridical persons in the sending of notices may be
found in the Revised Rules of Procedure of the DAR Adjudication Board (DARAB). Service of
pleadings before the DARAB is governed by Section 6, Rule V of the DARAB Revised Rules of
Procedure. Notices and pleadings are served on private domestic corporations or partnerships in
the following manner:
Sec. 6. Service upon Private Domestic Corporation or Partnership. — If the
defendant is a corporation organized under the laws of the Philippines or a
partnership duly registered, service may be made on the president,
manager, secretary, cashier, agent, or any of its directors or partners.
Similarly, the Revised Rules of Court of the Philippines, in Section 13, Rule 14 provides:
Sec. 13. Service upon private domestic corporation or partnership. — If the
defendant is a corporation organized under the laws of the Philippines or a
partnership duly registered, service may be made on the president,
manager, secretary, cashier, agent, or any of its directors.
Summonses, pleadings and notices in cases against a private domestic corporation before the
DARAB and the regular courts are served on the president, manager, secretary, cashier, agent
or any of its directors. These persons are those through whom the private domestic corporation
or partnership is capable of action. 62
Jaime Pimentel is not the president, manager, secretary, cashier or director of petitioner
corporation. Is he, as administrator of the two Haciendas, considered an agent of the
corporation?
The purpose of all rules for service of process on a corporation is to make it reasonably certain
that the corporation will receive prompt and proper notice in an action against it. 63 Service must
be made on a representative so integrated with the corporation as to make it a priori supposable
that he will realize his responsibilities and know what he should do with any legal papers served
on him, 64 and bring home to the corporation notice of the filing of the action. 65 Petitioner's
evidence does not show the official duties of Jaime Pimentel as administrator of petitioner's
haciendas. The evidence does not indicate whether Pimentel's duties is so integrated with the
corporation that he would immediately realize his responsibilities and know what he should do
with any legal papers served on him. At the time the notices were sent and the preliminary
conference conducted, petitioner's principal place of business was listed in respondent DAR's
records as "Soriano Bldg., Plaza Cervantes, Manila," 66 and "7th Flr. Cacho-Gonzales Bldg., 101
Aguirre St., Makati, Metro Manila." 67 Pimentel did not hold office at the principal place of
business of petitioner. Neither did he exercise his functions in Plaza Cervantes, Manila nor in
Cacho-Gonzales Bldg., Makati, Metro Manila. He performed his official functions and actually
resided in the haciendas in Nasugbu, Batangas, a place over two hundred kilometers away from
Metro Manila.
Curiously, respondent DAR had information of the address of petitioner's principal place of
business. The Notices of Acquisition over Haciendas Palico and Banilad were addressed to
petitioner at its offices in Manila and Makati. These Notices were sent barely three to four
months after Pimentel was notified of the preliminary conference. 68Why respondent DAR chose
to notify Pimentel instead of the officers of the corporation was not explained by the said
respondent.
Nevertheless, assuming that Pimentel was an agent of petitioner corporation, and the notices
and letters of invitation were validly served on petitioner through him, there is no showing that
Pimentel himself was duly authorized to attend the conference meeting with the MARO, BARC
and LBP representatives and farmer beneficiaries for purposes of compulsory acquisition of
petitioner's landholdings. Even respondent DAR's evidence does not indicate this authority. On
the contrary, petitioner claims that it had no knowledge of the letter-invitation, hence, could not
have given Pimentel the authority to bind it to whatever matters were discussed or agreed upon
by the parties at the preliminary conference or public hearing. Notably, one year after Pimentel
was informed of the preliminary conference, DAR A.O. No. 9, Series of 1990 was issued and this
required that the Notice of Coverage must be sent "to the landowner concerned or his duly
authorized representative." 69
Assuming further that petitioner was duly notified of the CARP coverage of its haciendas, the
areas found actually subject to CARP were not properly identified before they were taken over
by respondent DAR. Respondents insist that the lands were identified because they are all
registered property and the technical description in their respective titles specifies their metes
and bounds. Respondents admit at the same time, however, that not all areas in the haciendas
were placed under the comprehensive agrarian reform program invariably by reason of elevation
or character or use of the land. 70
The acquisition of the landholdings did not cover the entire expanse of the two haciendas, but
only portions thereof. Hacienda Palico has an area of 1,024 hectares and only 688.7576
hectares were targetted for acquisition. Hacienda Banilad has an area of 1,050 hectares but only
964.0688 hectares were subject to CARP. The haciendas are not entirely agricultural lands. In
fact, the various tax declarations over the haciendas describe the landholdings as "sugarland,"
and "forest, sugarland, pasture land, horticulture and woodland." 71
Under Section 16 of the CARL, the sending of the Notice of Acquisition specifically requires that
the land subject to land reform be first identified. The two haciendas in the instant case cover
vast tracts of land. Before Notices of Acquisition were sent to petitioner, however, the exact
areas of the landholdings were not properly segregated and delineated. Upon receipt of this
notice, therefore, petitioner corporation had no idea which portions of its estate were subject to
compulsory acquisition, which portions it could rightfully retain, whether these retained portions
were compact or contiguous, and which portions were excluded from CARP coverage. Even
respondent DAR's evidence does not show that petitioner, through its duly authorized
representative, was notified of any ocular inspection and investigation that was to be conducted
by respondent DAR. Neither is there proof that petitioner was given the opportunity to at least
choose and identify its retention area in those portions to be acquired compulsorily. The right of
retention and how this right is exercised, is guaranteed in Section 6 of the CARL, viz:
Sec. 6. Retention Limits. — . . . .
The right to choose the area to be retained, which shall be compact or
contiguous, shall pertain to the landowner; Provided, however, That in case
the area selected for retention by the landowner is tenanted, the tenant shall
have the option to choose whether to remain therein or be a beneficiary in
the same or another agricultural land with similar or comparable features. In
case the tenant chooses to remain in the retained area, he shall be
considered a leaseholder and shall lose his right to be a beneficiary under
this Act. In case the tenant chooses to be a beneficiary in another
agricultural land, he loses his right as a leaseholder to the land retained by
the landowner. The tenant must exercise this option within a period of one
(1) year from the time the landowner manifests his choice of the area for
retention.
Under the law, a landowner may retain not more than five hectares out of the total area of his
agricultural land subject to CARP. The right to choose the area to be retained, which shall be
compact or contiguous, pertains to the landowner. If the area chosen for retention is tenanted,
the tenant shall have the option to choose whether to remain on the portion or be a beneficiary in
the same or another agricultural land with similar or comparable features.
C. The Voluntary Acquisition of Hacienda Caylaway
Petitioner was also left in the dark with respect to Hacienda Caylaway, which was the subject of
a Voluntary Offer to Sell (VOS). The VOS in the instant case was made on May 6,
1988, 72 before the effectivity of R.A. 6657 on June 15, 1988. VOS transactions were first
governed by DAR Administrative Order No. 19, series of 1989, 73 and under this order, all VOS
filed before June 15, 1988 shall be heard and processed in accordance with the procedure
provided for in Executive Order No. 229, thus:
III. All VOS transactions which are now pending before the DAR and for
which no payment has been made shall be subject to the notice and hearing
requirements provided in Administrative Order No. 12, Series of 1989, dated
26 July 1989, Section II, Subsection A, paragraph 3.
All VOS filed before 15 June 1988, the date of effectivity of the CARL, shall
be heard and processed in accordance with the procedure provided for in
Executive Order No. 229.
xxx xxx xxx.
Sec. 9 of E.O. 229 provides:
Sec. 9. Voluntary Offer to Sell. — The government shall purchase all
agricultural lands it deems productive and suitable to farmer cultivation
voluntarily offered for sale to it at a valuation determined in accordance with
Section 6. Such transaction shall be exempt from the payment of capital
gains tax and other taxes and fees.
Executive Order 229 does not contain the procedure for the identification of private land as set
forth in DAR A.O. No. 12, Series of 1989. Section 5 of E.O. 229 merely reiterates the procedure
of acquisition in Section 16, R.A. 6657. In other words, the E.O. is silent as to the procedure for
the identification of the land, the notice of coverage and the preliminary conference with the
landowner, representatives of the BARC, the LBP and farmer beneficiaries. Does this mean that
these requirements may be dispensed with regard to VOS filed before June 15, 1988? The
answer is no.
First of all, the same E.O. 229, like Section 16 of the CARL, requires that the land, landowner
and beneficiaries of the land subject to agrarian reform be identified before the notice of
acquisition should be issued. 74 Hacienda Caylaway was voluntarily offered for sale in 1989. The
Hacienda has a total area of 867.4571 hectares and is covered by four (4) titles. In two separate
Resolutions both dated January 12, 1989, respondent DAR, through the Regional Director,
formally accepted the VOS over the two of these four
titles. 75 The land covered by two titles has an area of 855.5257 hectares, but only 648.8544
hectares thereof fell within the coverage of R.A. 6657. 76 Petitioner claims it does not know
where these portions are located.
Respondent DAR, on the other hand, avers that surveys on the land covered by the four titles
were conducted in 1989, and that petitioner, as landowner, was not denied participation therein,
The results of the survey and the land valuation summary report, however, do not indicate
whether notices to attend the same were actually sent to and received by petitioner or its duly
authorized representative. 77 To reiterate, Executive Order No. 229 does not lay down the
operating procedure, much less the notice requirements, before the VOS is accepted by
respondent DAR. Notice to the landowner, however, cannot be dispensed with. It is part of
administrative due process and is an essential requisite to enable the landowner himself to
exercise, at the very least, his right of retention guaranteed under the CARL.
III. The Conversion of the three Haciendas.
It is petitioner's claim that the three haciendas are not subject to agrarian reform because they
have been declared for tourism, not agricultural
purposes. 78 In 1975, then President Marcos issued Proclamation No. 1520 declaring the
municipality of Nasugbu, Batangas a tourist zone. Lands in Nasugbu, including the subject
haciendas, were allegedly reclassified as non-agricultural 13 years before the effectivity of R. A.
No. 6657. 79 In 1993, the Regional Director for Region IV of the Department of Agriculture
certified that the haciendas are not feasible and sound for agricultural development. 80 On March
20, 1992, pursuant to Proclamation No. 1520, the Sangguniang Bayan of Nasugbu, Batangas
adopted Resolution No. 19 reclassifying certain areas of Nasugbu as non-agricultural. 81 This
Resolution approved Municipal Ordinance No. 19, Series of 1992, the Revised Zoning
Ordinance of Nasugbu 82 which zoning ordinance was based on a Land Use Plan for Planning
Areas for New Development allegedly prepared by the University of the
Philippines. 83 Resolution No. 19 of the Sangguniang Bayan was approved by the Sangguniang
Panlalawigan of Batangas on March 8, 1993. 84
Petitioner claims that proclamation No. 1520 was also upheld by respondent DAR in 1991 when
it approved conversion of 1,827 hectares in Nasugbu into a tourist area known as the Batulao
Resort Complex, and 13.52 hectares in Barangay Caylaway as within the potential tourist
belt. 85 Petitioner present evidence before us that these areas are adjacent to the haciendas
subject of this petition, hence, the haciendas should likewise be converted. Petitioner urges this
Court to take cognizance of the conversion proceedings and rule accordingly. 6
We do not agree. Respondent DAR's failure to observe due process in the acquisition of
petitioner's landholdings does not ipso facto give this Court the power to adjudicate over
petitioner's application for conversion of its haciendas from agricultural to non-agricultural. The
agency charged with the mandate of approving or disapproving applications for conversion is the
DAR.
At the time petitioner filed its application for conversion, the Rules of Procedure governing the
processing and approval of applications for land use conversion was the DAR A.O. No. 2, Series
of 1990. Under this A.O., the application for conversion is filed with the MARO where the
property is located. The MARO reviews the application and its supporting documents and
conducts field investigation and ocular inspection of the property. The findings of the MARO are
subject to review and evaluation by the Provincial Agrarian Reform Officer (PARO). The PARO
may conduct further field investigation and submit a supplemental report together with his
recommendation to the Regional Agrarian Reform Officer (RARO) who shall review the same.
For lands less than five hectares, the RARO shall approve or disapprove applications for
conversion. For lands exceeding five hectares, the RARO shall evaluate the PARO Report and
forward the records and his report to the Undersecretary for Legal Affairs. Applications over
areas exceeding fifty hectares are approved or disapproved by the Secretary of Agrarian
Reform.
The DAR's mandate over applications for conversion was first laid down in Section 4 (j) and
Section 5 (l) of Executive Order No. 129-A, Series of 1987 and reiterated in the CARL and
Memorandum Circular No. 54, Series of 1993 of the Office of the President. The DAR's
jurisdiction over applications for conversion is provided as follows:
A. The Department of Agrarian Reform (DAR) is
mandated to "approve or disapprove applications for
conversion, restructuring or readjustment of agricultural
lands into non-agricultural uses," pursuant to Section 4
(j) of Executive Order No. 129-A, Series of 1987.
B. Sec. 5 (l) of E.O. 129-A, Series of 1987, vests in the
DAR, exclusive authority to approve or disapprove
applications for conversion of agricultural lands for
residential, commercial, industrial and other land uses.
C. Sec. 65 of R.A. No. 6657, otherwise known as the
Comprehensive Agrarian Reform Law of 1988, likewise
empowers the DAR to authorize under certain
conditions, the conversion of agricultural lands.
D. Sec. 4 of Memorandum Circular No. 54, Series of
1993 of the Office of the President, provides that "action
on applications for land use conversion on individual
landholdings shall remain as the responsibility of the
DAR, which shall utilize as its primary reference,
documents on the comprehensive land use plans and
accompanying ordinances passed upon and approved
by the local government units concerned, together with
the National Land Use Policy, pursuant to R.A. No.
6657 and E.O. No. 129-A. 87
Applications for conversion were initially governed by DAR A.O. No. 1, Series of 1990 entitled
"Revised Rules and Regulations Governing Conversion of Private Agricultural Lands and Non-
Agricultural Uses," and DAR A.O. No. 2, Series of 1990 entitled "Rules of Procedure Governing
the Processing and Approval of Applications for Land Use Conversion." These A.O.'s and other
implementing guidelines, including Presidential issuances and national policies related to land
use conversion have been consolidated in DAR A.O. No. 07, Series of 1997. Under this recent
issuance, the guiding principle in land use conversion is:
to preserve prime agricultural lands for food production while, at the same
time, recognizing the need of the other sectors of society (housing, industry
and commerce) for land, when coinciding with the objectives of the
Comprehensive Agrarian Reform Law to promote social justice,
industrialization and the optimum use of land as a national resource for
public welfare. 88
"Land Use" refers to the manner of utilization of land, including its allocation, development and
management. "Land Use Conversion" refers to the act or process of changing the current use of
a piece of agricultural land into some other use as approved by the DAR. 89 The conversion of
agricultural land to uses other than agricultural requires field investigation and conferences with
the occupants of the land. They involve factual findings and highly technical matters within the
special training and expertise of the DAR. DAR A.O. No. 7, Series of 1997 lays down with
specificity how the DAR must go about its task. This time, the field investigation is not conducted
by the MARO but by a special task force, known as the Center for Land Use Policy Planning and
Implementation (CLUPPI-DAR Central Office). The procedure is that once an application for
conversion is filed, the CLUPPI prepares the Notice of Posting. The MARO only posts the notice
and thereafter issues a certificate to the fact of posting. The CLUPPI conducts the field
investigation and dialogues with the applicants and the farmer beneficiaries to ascertain the
information necessary for the processing of the application. The Chairman of the CLUPPI
deliberates on the merits of the investigation report and recommends the appropriate action.
This recommendation is transmitted to the Regional Director, thru the Undersecretary, or
Secretary of Agrarian Reform. Applications involving more than fifty hectares are approved or
disapproved by the Secretary. The procedure does not end with the Secretary, however. The
Order provides that the decision of the Secretary may be appealed to the Office of the President
or the Court of Appeals, as the case may be, viz:
Appeal from the decision of the Undersecretary shall be made to the
Secretary, and from the Secretary to the Office of the President or the Court
of Appeals as the case may be. The mode of appeal/motion for
reconsideration, and the appeal fee, from Undersecretary to the Office of
the Secretary shall be the same as that of the Regional Director to the
Office of the Secretary. 90
Indeed, the doctrine of primary jurisdiction does not warrant a court to arrogate unto itself
authority to resolve a controversy the jurisdiction over which is initially lodged with an
administrative body of special competence. 91Respondent DAR is in a better position to resolve
petitioner's application for conversion, being primarily the agency possessing the necessary
expertise on the matter. The power to determine whether Haciendas Palico, Banilad and
Caylaway are non-agricultural, hence, exempt from the coverage of the CARL lies with the DAR,
not with this Court.
Finally, we stress that the failure of respondent DAR to comply with the requisites of due process
in the acquisition proceedings does not give this Court the power to nullify the CLOA's already
issued to the farmer beneficiaries. To assume the power is to short-circuit the administrative
process, which has yet to run its regular course. Respondent DAR must be given the chance to
correct its procedural lapses in the acquisition proceedings. In Hacienda Palico alone, CLOA's
were issued to 177 farmer beneficiaries in 1993. 92 Since then until the present, these farmers
have been cultivating their lands. 93 It goes against the basic precepts of justice, fairness and
equity to deprive these people, through no fault of their own, of the land they till. Anyhow, the
farmer beneficiaries hold the property in trust for the rightful owner of the land.
IN VIEW WHEREOF, the petition is granted in part and the acquisition proceedings over the
three haciendas are nullified for respondent DAR's failure to observe due process therein. In
accordance with the guidelines set forth in this decision and the applicable administrative
procedure, the case is hereby remanded to respondent DAR for proper acquisition proceedings
and determination of petitioner's application for conversion.
SO ORDERED.
CANON 13
G.R. No. L-22536 August 31, 1967
DOMINGO V. AUSTRIA, petitioner,
vs.
HON. ANTONIO C. MASAQUEL, in his capacity as the Presiding Judge of Branch II of the
Court of First Instance of Pangasinan, respondent.
Primicias, Del Castillo and Macaraeg for petitioner.
Antonio C. Masaquel for respondent.
ZALDIVAR, J.:
This is a petition for a writ of certiorari to annul or set aside the order of respondent Judge
Antonio Masaquel, dated February 10, 1964, in Civil Case No. 13258 of the Court of First
Instance of Pangasinan, declaring petitioner Domingo V. Austria guilty of contempt of court and
imposing upon him a fine of P50.00.
The facts that gave rise to the incident in question are not disputed. Petitioner was one of the
plaintiffs in the above-mentioned Civil Case No. 132581 against Pedro Bravo for the recovery of
three parcels of land — one parcel being located at Bayambang and two parcels in San Carlos,
in the province of Pangasinan. On April 19, 1963, after trial, respondent Judge rendered a
decision declaring the plaintiffs the owners of the three parcels of land in question and ordering
the defendant to vacate the lands and pay the plaintiffs damages only with respect to the land
located at Bayambang. The plaintiffs filed a motion for the immediate execution of the judgment
— which motion was granted by respondent Judge on May 31, 1963 — and, upon the plaintiffs'
having posted a surety bond in the sum of P2,000.00, the sheriff placed them in possession of
the lands located at San Carlos.
On May 23, 1963, Atty. Mariano C. Sicat, a former assistant or associate of respondent Judge
when the latter was still in the practice of law before his appointment to the bench, entered his
appearance as the new counsel for defendant Pedro Bravo, vice Attorney Antonio Resngit. On
June 14, 1963, the defendant, through Atty. Sicat, filed a supersedeas bond to stay the
execution of the judgment, and on June 20, 1963 respondent Judge granted the stay of
execution, over the objection of plaintiffs, and ordered the sheriff to restore the possession of the
lands in San Carlos to the defendant. The petitioner likewise had asked for the appointment of a
receiver over the parcel of land located at Bayambang, which prayer was granted by respondent
Judge on July 8, 1963; but upon the filing of a bond by the defendant for the non-appointment of
a receiver, the order receivership was set aside. On August 24, 1963, pending the approval of
the defendant's amended record on appeal, Atty. Sicat filed a motion for new trial and to set
aside the judgment and, over the vigorous objection of plaintiffs, the respondent Judge granted
the said motion on November 7, 1963. The hearing on the retrial was finally set for February 10,
1964.
Before the opening of the court's session in the morning of February 10, 1964, Atty. Daniel
Macaraeg, counsel for petitioner and his co-plaintiffs, saw respondent Judge in his chamber and
verbally transmitted to him the request of petitioner that he (the Judge) inhibit himself from
further hearing the case upon the ground that the new counsel for the defendant, Atty. Mariano
C. Sikat, was his former associate. The respondent Judge, however, rejected the request
because, according to him, the reason for the request of his inhibition is not one of the grounds
for disqualification of a judge provided for in the Rules of Court. Thereafter, when the case was
called for hearing in open court, the following transpired, as shown by the transcript of the
stenographic notes taken during said hearing:2
APPEARANCE:
ATTY. DANIEL C. MACARAEG:
appeared in behalf of plaintiffs. (After the case was called)
COURT:
Your client is here? Yes, sir.

ATTY. MACARAEG: COURT:

Yes, Your Honor. All right. Do you doubt the integrity of the presiding Judge to decide this case fairly
and impartially because the lawyer of the other party was my former assistant? Do you
doubt? Just answer the question?
COURT:

DOMINGO AUSTRIA:
Where is he?

Yes, sir.
ATTY. MACARAEG:

COURT:
He is here, Your Honor.

The Court hereby finds you guilty of contempt of Court and you are hereby ordered to
COURT:
pay a fine of P50.00.

What is your name?

ATTY. MACARAEG:

PLAINTIFF:
With due indulgence of this Honorable Court — I have learned, after I have conferred
with you in chambers, another ground of the plaintiffs for their requesting me to ask for
Domingo Austria, sir. the disqualification of Your Honor in this case, and this ground consists of the rampant
rumor coming from the defendant Pedro Bravo himself that he is boasting in San
Carlos that because he has a new lawyer, that surely he is going to win this case.
COURT:

COURT:
You are one of the plaintiffs in this case?

Why did you not wait until the case is finally decided and find out if that is true or not?
DOMINGO AUSTRIA:

ATTY. MACARAEG:
Yes, sir.

And maybe, that is why the plaintiffs requested me to approach Your Honor because
COURT: of that rampant rumor that Pedro Bravo is spreading.

Atty. Macaraeg approached me in chambers requesting me to disqualify myself in

COURT:
hearing this case. Did you authorize Atty. Macaraeg to approach me verbally to
disqualify myself from hearing this case because the lawyer of the other party was my
former assistant? You mean to say because of that rumor, you are going to doubt my integrity?

DOMINGO AUSTRIA: ATTY. MACARAEG:

Yes, sir. As for me, I entertain no doubt, Your Honor.

COURT: COURT:

Is that your reason why you requested Atty. Macaraeg to approach me, requesting me Your client expressed openly in Court his doubts on the integrity of the Court simply
to disqualify myself simply because the lawyer of the other party was my assistant? based on rumors and that is a ground for contempt of court, if only to maintain the faith
of the people in the courts.
DOMINGO AUSTRIA:
 ATTY. MACARAEG: of upholding and administering justice, without fear or favor, and by reason of which
this Court denied the verbal motion to reconsider filed by counsel for the plaintiff
Domingo Austria, finding him guilty of contempt of court and ordering him to pay a fine
Taking into consideration that these plaintiffs are laymen and we cannot expect from
of P50.00.
them the thinking of a lawyer, I am most respectfully praying that the Order of this
Court be reconsidered.
SO ORDERED.
COURT:
Given in open Court this 10th day of February, 1964, at Lingayen, Pangasinan.
Denied. Your client should pay a fine of P50.00. We will hear this case this afternoon.
Petitioner Domingo Austria, accordingly, paid the fine of P50.00 under protest. Having been
punished summarily for direct contempt of court, and the remedy of appeal not being available to
ATTY. MACARAEG:
him, petitioner filed the instant petition for certiorari before this Court.

Yes, Your Honor.

It is the position of the petitioner that under the facts and circumstances attendant to the hearing
of the Civil Case No. 13250 on February 10, 1063, he had not committed an act of contempt
The respondent Judge forthwith dictated the following order:3 against the court and the respondent Judge had acted in excess of his jurisdiction with grave
abuse of discretion when he declared petitioner in direct contempt of court and imposed on him
the fine of P50.00 as a penalty.
Before this Court opened its sessions this morning, Atty. Daniel C. Macaraeg, counsel
for the plaintiffs, approached the presiding Judge of this Court in his chambers and
manifested the desire of his clients for the Judge to disqualify himself from trying the After a careful study of the record, We find merit in this petition.
above-entitled case for the reason that counsel for the defendant, Atty. Marciano C.
Sicat was formerly an associate of the Judge of this Court while he was still engaged
The respondent Judge declared the petitioner in direct contempt of court. Our task, therefore, is
in the practice of law. To this manifestation of Atty. Macaraeg, the Presiding Judge
to determine whether or not the petitioner was guilty of misbehavior in the presence of or so near
informed the latter that such fact alone does not in itself constitute a legal ground to
a court or judge, as to obstruct or interrupt the proceedings before the same, or had committed
disqualify the Presiding Judge of this Court, from trying this case.
an act of disrespect toward the court or judge.4

When the above-entitled case was called for hearing, the Presiding Judge called on
The respondent Judge considered the actuation of the petitioner, in the premises, as offensive,
one of the plaintiffs who was present, namely, Domingo Austria, and inquired from the
insulting, and a reflection on his integrity and honesty and a showing of lack of respect to the
latter if it was true that he asked his lawyer Atty. Macaraeg to approach the Judge in
court. The respondent Judge considered that the petitioner was not justified and had no reason
chambers and to ask him to disqualify himself from trying this case because
to entertain doubts in his fairness and integrity simply because the defendant's counsel was his
defendant's lawyer, Atty. Sicat was formerly associated with the said Judge. To this
former associate.1äwphï1.ñët
query Domingo Austria answered in the affirmative. When he was also asked as to
whether the said Domingo Austria has lost faith in the sense of fairness and justice of
the Presiding Judge of this Court simply because of his former association with the We do not agree with the respondent Judge. It is our considered view that when the petitioner
defendant's lawyer, said Domingo Austria likewise answered in the affirmative. requested respondent Judge to inhibit himself from further trying the case upon the ground that
the counsel for the opposite party was the former associate of the respondent Judge, petitioner
did so because he was impelled by a justifiable apprehension which can occur in the mind of a
The Court considers the actuation of the plaintiff Domingo Austria, in the premises, as
litigant who sees what seems to be an advantage on the part of his adversary; and that the
offensive, insulting and a reflection on the integrity and honesty of the Presiding Judge
petitioner made his request in a manner that was not disrespectful, much less insulting or
of this Court and shows his lack of respect to the Court. The said Domingo Austria is
offensive to the respondent Judge or to the court.
not justified and has no reason to entertain doubts in the fairness and integrity of the
Presiding Judge of this Court, simply because of the latter's former association with
defendant's counsel. For this reason and in order to maintain the people's faith and We are in accord with the statement of respondent Judge in his memorandum that the
respect in their courts — the last bulwark in our democratic institutions — the circumstance invoked by petitioner in asking him to inhibit himself from further trying the case —
Presiding Judge declared said plaintiff Domingo Austria in direct contempt of court and that Atty. Sicat was his former associate in his practice of law — is not one of the grounds
he was ordered to pay a fine of P50.00. enumerated in the first paragraph of Section 1, Rule 137 of the new Rules of Court for
disqualifying a judge. While it is true that respondent Judge may not be compelled to disqualify
himself, the fact that Atty. Sicat, admittedly his former associate, was counsel for a party in the
The Court found from the manifestation of plaintiffs' counsel Atty. Macaraeg that the
case being tried by him, may constitute a just or valid reason for him to voluntarily inhibit himself
basis of the statement, of Domingo Austria that he has lost his faith in the Presiding
from hearing the case on a retrial, if he so decides, pursuant to the provision of the second
Judge of this Court is the rumors being circulated by the defendant Pedro Bravo that
paragraph of Section 1 of the said Rule 137.5
he will surely win in the present case because of his new lawyer, Atty. Marciano C.
Sicat. The Court believes that rumors of the sort do not serve as a sufficient basis or
justification for the plaintiff Domingo Austria to insinuate bias and partiality, on the part The apprehension of petitioner regarding the probable bias of respondent Judge does not
of the Court and to express openly his loss of faith and confidence in the integrity, appear to be groundless or entirely devoid of reason. The respondent Judge had decided the
fairness and capability of the Presiding Judge of this Court to perform his sworn duty case in favor of petitioner and his co-plaintiffs, and that upon plaintiffs' timely motion and filing of
bond they were already placed in possession of the lands in question pending appeal. It was fairness and the integrity of the Judge. Consequently, we take it to be the true
when Atty. Sicat took over as new counsel for defendant that the latter was given back the intention of the law — stated in general terms — that no judge shall preside in a case
properties, upon a motion to stay the execution of the judgment which was filed by said counsel in which he is not wholly free, disinterested, impartial and independent (30 Am.
and was granted by respondent Judge over the opposition of petitioner's counsel. Again, when Jur. supra) . . . . 6 (Emphasis supplied).
the same counsel for defendant filed a motion for a new trial, said motion was granted by
respondent Judge in spite of the vigorous objection of counsel for the petitioner and his co-
It is in line with the above-quoted observation that this Court, in amending the Rules of Court,
plaintiffs. And then the petitioner became aware of the fact that his adversary, the defendant
added the second paragraph under Section 1 of Rule 137, which provides that a judge in the
Pedro Bravo, had been boasting in San Carlos that he was sure to win his case because of his
exercise of his sound discretion may disqualify himself from sitting in a case for just or valid
new lawyer.
grounds other than those specifically mentioned in the first paragraph of said section. 7 "The
courts should administer justice free from suspicion or bias and prejudice; otherwise, parties
We believe that the petitioner — the layman that he is — did not take a belligerent or arrogant litigants might lose confidence in the judiciary and destroy its nobleness and decorum." 8
attitude toward respondent Judge. What he did was to request his lawyer, Atty. Macaraeg, to
approach respondent Judge in his chamber and suggest to him to refrain from hearing the case
Respondent Judge declared petitioner in contempt of court after the latter answered "Yes, sir" to
on the new trial, precisely in order that respondent Judge might not be embarrassed or exposed
this question of the judge: "Do you doubt the integrity of the presiding Judge to decide this case
to public odium. There is nothing in the record which shows that when respondent Judge refused
fairly and impartially because the lawyer of the other party was my former assistant? Do you
to disqualify himself, the petitioner insisted in asking for his disqualification. If the request of
doubt? Just answer the question?" We believe that petitioner had not committed an act
petitioner for respondent Judge to disqualify himself came to the knowledge of the public it was
amounting to contempt of court when he made that answer. The petitioner had not misbehaved
because respondent Judge himself brought up the matter in open court.
in court, or in the presence of respondent Judge, as to obstruct or interrupt the proceedings.
Neither did the petitioner act in a manner that was disrespectful to respondent Judge. When
While We consider it improper for a litigant or counsel to see a judge in chambers and talk to him petitioner answered "Yes, sir" to the question asked by respondent Judge, petitioner simply
about a matter related to the case pending in the court of said judge, in the case now before Us expressed his sincere feeling under the circumstances. In order that a person may be summarily
We do not consider it as an act of contempt of court when petitioner asked his counsel to see punished for direct contempt of court, it must appear that his behavior or his utterance tends to
respondent Judge in his chamber and request him to disqualify himself upon a ground which obstruct the proceedings in court, or constitutes an affront to the dignity of the court. As stated
respondent Judge might consider just or valid. It is one thing to act not in accordance with the by this Court, "Contempt of court presupposes a contumacious attitude, a flouting or arrogant
rules, and another thing to act in a manner which would amount to a disrespect or an affront to belligerence, a defiance of the court . . . ."9
the dignity of the court or judge. We believe that the circumstances that led respondent Judge to
declare petitioner in direct contempt of court do not indicate any deliberate design on the part of
We commend the zeal shown by respondent Judge in his effort to protect his own integrity and
petitioner to disrespect respondent Judge or to cast aspersion against his integrity as a judge.
the dignity of the court. We are constrained to say, however, that he had gone a little farther than
On the contrary, it may be said that petitioner wanted to avoid cause for any one to doubt the
what was necessary under the circumstances. We are inclined to believe that respondent Judge
integrity of respondent Judge. This is so because when a party litigant desires or suggests the
felt offended when petitioner answered "Yes, sir" to the question adverted to in the preceding
voluntary disqualification of a judge, it is understood, without saying it in so many words, that
paragraph. But the petitioner was simply truthful and candid to the court when he gave that
said litigant — having knowledge of the past or present relationship of the judge with the other
answer. It would have been unfair to respondent Judge had petitioner answered "No, sir,"
party or counsel — feels that no matter how upright the judge is there is peril of his being
because then he would not be sincere with the court, and he would be inconsistent with the
unconsciously swayed by his former connection and he may unwittingly render a biased or unfair
request that he made through his counsel for respondent Judge to inhibit himself from further
decision. Hence, while it may be conceded that in requesting the disqualification of a judge by
hearing the case. When respondent Judge asked that question, he necessarily expected a
reason of his relation with a party or counsel there is some implication of the probability of his
truthful answer from petitioner, and indeed petitioner gave him the truthful answer. We are not
being partial to one side, the request can not constitute contempt of court if done honestly and in
persuaded that in so answering petitioner meant to be disrespectful, offensive or insulting to
a respectful manner, as was done by petitioner in the present case. Perhaps the fault of
respondent Judge. Nor do We consider that in so answering petitioner meant to cast reflection
petitioner, if at all, is his having asked his counsel to make the request to respondent Judge
on the integrity and honesty of respondent Judge. We believe that in so answering the petitioner
inside the latter's chamber.
was simply manifesting the misgiving of an ordinary layman about the outcome of his case that
is going to be tried by a judge who has been closely associated with the counsel for his
The following observation of this Court, speaking through Mr. Justice Dizon, is relevant to the adversary. The petitioner would never have expressed that misgiving of his had respondent
question before Us: Judge not asked him in open court a question that evoked that answer. A judge can not prevent
any person — even a litigant or counsel in a case before him — to entertain in his mind an
opinion about him as a judge. Certainly, any person is entitled to his opinion about a judge,
Petitioner invoking the provisions of section 1, Rule 126 of the Rules of Court, argues
whether that opinion is flattering to the judge, or not. It would be different if a person would
that the case of respondent judge does not fall under any one of the grounds for the
deliberately and maliciously express an adverse opinion about a judge, without reason, but
disqualification of judicial officers stated therein. Assuming arguendo that a literal
simply to malign and discredit the judge. In the case now before Us We believe that petitioner
interpretation of the legal provision relied upon justifies petitioner's contention to a
did not mean to malign or discredit respondent Judge in answering as he did. It can be said that
certain degree, it should not be forgotten that, in construing and applying said legal
petitioner was simply moved by a desire to protect his interests in the case pending before the
provision, we cannot disregard its true intention nor the real ground for the
court, presided by respondent Judge. A citizen of this Republic is entitled to expect that our
disqualification of a judge or judicial officer, which is the impossibility of rendering an
courts of justice are presided by judges who are free from bias and prejudice — and it should not
impartial judgment upon the matter before him. It has been said, in fact, that due
be made a count against the citizen if he so expresses himself truthfully, sincerely, and
process of law requires a hearing before an impartial and disinterested tribunal, and
respectfully. A judge, as a public servant, should not be so thin-skinned or sensitive as to feel
that every litigant is entitled to nothing less than the cold neutrality of an impartial
hurt or offended if a citizen expresses an honest opinion about him which may not altogether be
judge (30 Am. Jur. p. 767). Moreover, second only to the duty of rendering a just
flattering to him. 10 After all, what matters is that a judge performs his duties in accordance with
decision, is the duty of doing it in a manner that will not arouse any suspicion as to its
the dictates of his conscience and the light that God has given him. A judge should never allow
himself to be moved by pride, prejudice, passion, or pettiness in the performance of his duties.
And a judge should always bear in mind that the power of the court to punish for contempt
should be exercised for purposes that are impersonal, because that power is intended as a
safeguard not for the judges as persons but for the functions that they exercise.
It is worth mentioning here that numerous cases there have been where judges, and even
members of this Court, were asked to inhibit themselves from trying, or from participating in the
consideration of, a case, but scarcely were the movants punished for contempt even if the
grounds upon which they based their motions for disqualification are not among those provided
in the rules. It is only when there was direct imputation of bias or prejudice, or a stubborn
insistence to disqualify the judge, done in a malicious, arrogant, belligerent and disrespectful
manner, that movants were held in contempt of court. 11 And this liberal attitude of the courts is
in keeping with the doctrine that "The power to punish for contempt of court should be exercised
on the preservative and not on the vindictive principle. Only occasionally should the court invoke
its inherent power in order to retain that respect without which the administration of justice must
falter or fail." 12 The power to punish for contempt, being drastic and extraordinary in its nature,
should not be resorted to unless necessary in the interest of justice. 13
Wherefore, the order of respondent Judge dated February 10, 1964, in Civil Case No. 13259 of
the Court of First Instance of Pangasinan, declaring petitioner in direct contempt of court and
ordering him to pay a fine of P50.00, is hereby annulled and set aside; and it is ordered that the
sum of P50.00, paid under protest by petitioner as a fine, be refunded to him. No costs. It is so
ordered.
A.M. No. MTJ-95-1035 June 21, 1995
EMETERIO GALLO through Counsel Atty. Francisco C. Aurillo, complainant,
vs.
JUDGE JOSE CORDERO, MTC, Babatñgon, Leyte, respondent.
MENDOZA, J.:
This is a sworn complaint dated September 8, 1994 of Emeterio Gallo, charging Judge Jose
Cordero of the Municipal Trial Court of Babatñgon, Leyte with non-feasance, manifest bias,
gross ignorance of the law, and graft and rank favoritism.
The complaint is made in connection with Criminal Case No. 2194 entitled "People v. Cristuto
Barreta, Alberto Macabata, Danilo Morillo, and Rodolfo Villanueva," which complainant filed in
respondent judge's court on August 23, 1994 for violation of P.D.No. 772, otherwise known as
the Anti-Squatting Law. The criminal complaint alleged:
That several years ago, at Barangay Bagong Silang,
municipality of Babatñgon, Province of Leyte,
Philippines and within the jurisdiction of this Honorable
Court, the above-named accused, all taking advantage
of the absence or tolerance of the land owners, did then
and there, succeeded in occupying and possessing
certain portions of the property of the latter against their
will for residential and small farming purposes, and
have refused to vacate the property despite demands
for them to do so.
CONTRARY TO LAW.
On August 26, 1994, respondent issued a subpoena1 to complainant requiring him to appear and
to testify regarding his affidavit and to bring with him documents attesting to his ownership of the
land. Complainant appeared as directed on August 30, 1994 in respondent's office. According to
complainant's affidavit dated September 7, 1994,2the following transpired:
That on August 30, 1994 I saw Honorable Judge Jose Cordero in his office,
having been summoned to appear before him on that day;
That he then asked me if I have papers of ownership of land, such as tax
declaration, and I said yes but did not bring them as this was no trial; and
besides, he already had the records submitted by the chief of police;
That since he insisted on seeing our tax declaration, with his permission I
went to the office of the municipal assessor, secured a certified copy of the
tax declaration of land in Bagong Silang, and gave it to him; and noting the
area to be 21 hectares the Judge commented that ours is quite a big tract of
land;
That when I asked the Judge if the accused have already been arrested, he
said No; so I said, what about this case of ours? And he asked what I really
wanted. When I said I want them ejected from our land the Judge said: "No,
you cannot eject tenants now under the law." I countered that the four
accused are not tenants, but the Judge said, "Even then, nobody can eject
them.
That disappointed at his answers which clearly were biased for the accused,
I asked permission to leave, which was granted. But he added that I should
see him again on Sept. 14, the day before trial which he set for Sept. 15; . . .
.
The following day, according to complainant, his son Roger Gallo went to respondent's office to
deliver his letter in which he inquired from the judge whether he had already issued a warrant of
arrest against the accused; that upon entering the office, Roger saw respondent conversing with
the accused in the criminal case;3 that an aide of respondent received the letter and opened it;
that respondent did not however say anything nor reply to complainant's letter; that when Roger
left the office, respondent judge and the four accused continued their conversation. 4
Complainant charges that (a) in violation of art. 207 (malicious delay in the administration of
justice) and art. 208 (negligence and tolerance in the prosecution of crimes) of the Revised
Penal Code respondent judge refused to order the arrest of the accused in Criminal Case No.
2194; (b) that respondent privately conferred with the accused in his office on August 31, 1994
which "logically and naturally arouses suspicion of graft and rank favoritism;" and (c) that he
acted with bias and ignorance of the law in telling complainant, "You cannot eject tenants now
under the law," and that even if the accused were not tenants, "nobody can eject them."
Complainant Gallo prays that (1) respondent be preventively suspended or ordered to inhibit
himself from hearing the case and that another judge be assigned to handle the case and (2)
after due hearing, respondent be dismissed from the service.
In his comment, respondent alleges that he did not order the arrest of the accused for the
following reasons: (1) the complaint charges no offense under P.D. No. 772 because of "the
absence [of] recital in the body of [the] complaint that the property occupied possessed is within
the urban communities" per the ruling in People v. Echavez,5 that the crime of squatting applies
only to urban communities,6 (2) the complaint is defective because of its failure to state the name
of the offended party and the date and time of the commission of
the offense; (3) respondent acted in compliance with Administrative Circular No. 8-92 which
"reiterates to all trial court judges the need for a careful consideration of the proper application of
the Comprehensive Agrarian Reform Law (RA 6657) to avoid conflict of jurisdiction with the
Department of Agrarian Reform Adjudication Boards," and (4) he thought that complainant Gallo
was merely pressuring the accused to vacate the property through the filing of a criminal case
against them.
Respondent also contends that he cannot be liable under art. 208 of the Revised Penal Code,
because this provision applies to the failure of public prosecutors to prosecute for law violations.
Respondent denied uttering the statements attributed to him allegedly showing that he had
prejudged the case, the truth being that he merely
asked complainant certain questions to ascertain compliance with Rule 110 §§ 6 and 11 7 of the
Revised Rules on Criminal Procedure.
As for his alleged "private conference" with the accused, respondent claims that he merely tried
to advise them of their right to a counsel de oficio in case they could not afford to hire a lawyer.
With regard to complainant's demand for his inhibition, respondent alleges that there was no
basis for complainant to say that he could not expect justice from him (respondent judge)
because the case had just been set for the arraignment of the accused.
To be sure, Criminal Case No. 2194 was filed invoking the original and exclusive jurisdiction of
respondent judge's court, considering that under P.D. No. 772 the offense charged is punishable
by imprisonment ranging from 6 months to 1 year or a fine of not less than P1,000.00 nor more
than P5,000.00.8 Hence, in accordance with Rule 112, §9(b), in relation to §3(a) thereof,
respondent's job was to determine at the outset if there was sufficient ground to hold the
accused for trial, on the basis of the complaint and affidavits submitted. If there was no sufficient
ground to hold the accused for trial, the judge should dismiss the complaint or information,
otherwise, he should issue a warrant of arrest after personally examining the complainant and
his witnesses in writing and under oath in the form of searching questions and answers.
Apparently, respondent judge found sufficient ground to hold the accused in the criminal case for
trial. That is why subpoenas were issued to the complainant and the accused. In the case of the
complainant, the subpoena required him to testify and bring with him the papers showing his title
to the land. But respondent judge did not examine him with a view to the issuance of a warrant
of arrest. Instead, as he now says in his comment, he subpoenaedcomplainant only to determine
the sufficiency of the complaint. Yet, respondent likewise required the accused to present their
evidence the next day, August 31, 1994.
It would thus appear that respondent was confused about what to do. He says in his comment
that he found the criminal complaint to be insufficient because it does not state the time of
commission of the offense and the name of the offended party. He also contends that it does not
charge an offense because in accordance with the ruling in People v. Echavez,9 the offense
punished under P.D. No. 772 is committed only in urban communities, although in Jumawan v.
Eviota 10 we overruled People v. Echavez and held that what is punished by the law is squatting
on land which is used for residential, commercial or other purposes. Be that as it may, however,
what respondent should have done was to dismiss the criminal case. The fact, however, is that
he did not dismiss the complaint; neither did he, on the other hand, order the arrest of the
accused in that case.
Respondent judge also opened himself to charges of partiality and bias by meeting privately with
the four accused. He says that he merely wanted to apprise them of their constitutional right.
Whatever his purpose was, it was improper for respondent judge to meet them without the
presence of complainant. As already stated, the subpoenarequired the accused to appear in
court on August 31, 1994 to give their testimony. But no hearing was set on that date. In fact
complainant's son, Roger, merely chanced on the accused in the office of the judge on August
31, 1994 because he had been sent by his father to deliver the latter's letter inquiring whether
the judge had yet issued a warrant for the arrest of the accused.
Thus, respondent judge not only has shown gross ignorance of law and procedure but has also
failed to live up to the norm that "judges should not only be impartial but should also appear
impartial." 11 He thus violated Canon 2 of the Code of Judicial Conduct which provides that "a
judge should avoid impropriety and the appearance of impropriety in all activities." In the words
of Rule 2.01 of that Canon, "A judge should so behave at all times as to promote public
confidence in the integrity and impartiality of the judiciary.
Respondent judge was compulsorily retired on March 11, 1995, after reaching the age of 70.
This fact, however, does not render this case moot and academic. As held in Zarate v. Judge
Romanillos: 12
[T]he jurisdiction that was ours at the time of the filing of
the administrative complaint was not lost by the mere
fact that the respondent public official had ceased in
office during the pendency of his case. The Court
retains its jurisdiction either to pronounce the
respondent official innocent of the charges or declare
him guilty thereof. A contrary rule would be fraught with
injustices and pregnant with dreadful and dangerous
implications. . . . If innocent, respondent official merits
vindication of his name and integrity as he leaves the
government which he has served well and faithfully; if
guilty, he deserves to receive the corresponding
censure and a penalty proper and imposable under the
situation.
ACCORDINGLY, a FINE of P10,000.00 is imposed on respondent Judge Jose Cordero, the
same to be deducted from whatever retirement benefits he may be entitled to receive from the
government.
SO ORDERED.
G.R. No. 75209 September 30, 1987
NESTLE PHILIPPINES, INC., petitioner,
vs.
HON. AUGUSTO S. SANCHEZ, MINISTER OF LABOR AND EMPLOYMENT and THE UNION
OF FILIPRO EMPLOYEES, respondents.
No. 78791 September 30, 1987
KIMBERLY INDEPENDENT LABOR UNION FOR SOLIDARITY, ACTIVISM AND
NATIONALISM-OLALIA, petitioner,
vs.
NATIONAL LABOR RELATIONS COMMISSION, MANUEL AGUILAR, MA. ESTRELLA
ALDAS, CAPT. REY L. LANADA, COL. VIVENCIO MANAIG and KIMBERLY-CLARK
PHILIPPINES, INC., respondents.
RESOLUTION
PER CURIAM:
During the period July 8-10. 1987, respondent in G.R. No. 75029, Union of Filipro Employees,
and petitioner in G.R. No. 78791, Kimberly Independent Labor Union for Solidarity, Activism and
Nationalism-Olalia intensified the intermittent pickets they had been conducting since June 17,
1987 in front of the Padre Faura gate of the Supreme Court building. They set up pickets'
quarters on the pavement in front of the Supreme Court building, at times obstructing access to
and egress from the Court's premises and offices of justices, officials and employees. They
constructed provisional shelters along the sidewalks, set up a kitchen and littered the place with
food containers and trash in utter disregard of proper hygiene and sanitation. They waved their
red streamers and placards with slogans, and took turns haranguing the court all day long with
the use of loud speakers.
These acts were done even after their leaders had been received by Justices Pedro L. Yap and
Marcelo B. Fernan as Chairmen of the Divisions where their cases are pending, and Atty. Jose
C. Espinas, counsel of the Union of Filipro Employees, had been called in order that the pickets
might be informed that the demonstration must cease immediately for the same constitutes
direct contempt of court and that the Court would not entertain their petitions for as long as the
pickets were maintained. Thus, on July 10, 1987, the Court en banc issued a resolution giving
the said unions the opportunity to withdraw graciously and requiring Messrs. Tony Avelino. Lito
Payabyab, Eugene San Pedro, Dante Escasura, Emil Sayao and Nelson Centeno, union leaders
of respondent Union of Filipro Employees in the Nestle case and their counsel of record, Atty.
Jose C. Espinas; and Messrs. Ernesto Facundo, Fausto Gapuz, Jr. and Antonio Gonzales, union
leaders of petitioner Kimberly Independent Labor Union for Solidarity, Activism and Nationalism-
Olalia in the Kimberly case to appear before the Court on July 14, 1987 at 10:30 A.M. and then
and there to SHOW CAUSE why they should not be held in contempt of court. Atty. Jose C.
Espinas was further required to SHOW CAUSE why he should not be administratively dealt with.
On the appointed date and time, the above-named individuals appeared before the Court,
represented by Atty. Jose C. Espinas, in the absence of Atty. Potenciano Flores, counsel of
record of petitioner in G.R. No. 78791, who was still recuperating from an operation.
Atty. Espinas, for himself and in behalf of the union leaders concerned, apologized to the Court
for the above-described acts, together with an assurance that they will not be repeated. He
likewise manifested to the Court that he had experienced to the picketers why their actions were
wrong and that the cited persons were willing to suffer such penalty as may be warranted under
the circumstances. 1 He, however, prayed for the Court's leniency considering that the picket
was actually spearheaded by the leaders of the "Pagkakaisa ng Mangagawa sa Timog
Katagalogan" (PAMANTIK), an unregistered loose alliance of about seventy-five (75) unions in
the Southern Tagalog area, and not by either the Union of Filipro Employees or the Kimberly
Independent Labor Union. 2
Atty. Espinas further stated that he had explained to the picketers that any delay in the resolution
of their cases is usually for causes beyond the control of the Court and that the Supreme Court
has always remained steadfast in its role as the guardian of the Constitution.
To confirm for the record that the person cited for contempt fully understood the reason for the
citation and that they wig abide by their promise that said incident will not be repeated, the Court
required the respondents to submit a written manifestation to this effect, which respondents
complied with on July 17, 1987.
We accept the apologies offered by the respondents and at this time, forego the imposition of
the sanction warranted by the contemptuous acts described earlier. The liberal stance taken by
this Court in these cases as well as in the earlier case of AHS/PHILIPPINES EMPLOYEES
UNION vs. NATIONAL LABOR RELATIONS COMMISSION, et al., G.R. No. 73721, March 30,
1987, should not, however, be considered in any other light than an acknowledgment of the
euphoria apparently resulting from the rediscovery of a long-repressed freedom. The Court will
not hesitate in future similar situations to apply the full force of the law and punish for contempt
those who attempt to pressure the Court into acting one way or the other in any case pending
before it. Grievances, if any, must be ventilated through the proper channels, i.e., through
appropriate petitions, motions or other pleadings in keeping with the respect due to the Courts
as impartial administrators of justice entitled to "proceed to the disposition of its business in an
orderly manner, free from outside interference obstructive of its functions and tending to
embarrass the administration of justice." 3
The right of petition is conceded to be an inherent right of the citizen under all free governments.
However, such right, natural and inherent though it may be, has never been invoked to shatter
the standards of propriety entertained for the conduct of courts. For "it is a traditional conviction
of civilized society everywhere that courts and juries, in the decision of issues of fact and law
should be immune from every extraneous influence; that facts should be decided upon evidence
produced in court; and that the determination of such facts should be uninfluenced by bias,
prejudice or sympathies."4
Moreover, "parties have a constitutional right to have their causes tried fairly in court by an
impartial tribunal, uninfluenced by publication or public clamor. Every citizen has a profound
personal interest in the enforcement of the fundamental right to have justice administered by the
courts, under the protection and forms of law free from outside coercion or interference." 5 The
aforecited acts of the respondents are therefore not only an affront to the dignity of this Court,
but equality a violation of the above-stated right of the adverse parties and the citizenry at large.
We realize that the individuals herein cited who are non-lawyers are not knowledgeable in her
intricacies of substantive and adjective laws. They are not aware that even as the rights of free
speech and of assembly are protected by the Constitution, any attempt to pressure or influence
courts of justice through the exercise of either right amounts to an abuse thereof, is no longer
within the ambit of constitutional protection, nor did they realize that any such efforts to influence
the course of justice constitutes contempt of court. 6 The duty and responsibility of advising
them, therefore, rest primarily and heavily upon the shoulders of their counsel of record. Atty.
Jose C. Espinas, when his attention was called by this Court, did his best to demonstrate to the
pickets the untenability of their acts and posture. Let this incident therefore serve as a reminder
to all members of the legal profession that it is their duty as officers of the court to properly
apprise their clients on matters of decorum and proper attitude toward courts of justice, and to
labor leaders of the importance of a continuing educational program for their members.
WHEREFORE, the contempt charges against herein respondents are DISMISSED. Henceforth,
no demonstrations or pickets intended to pressure or influence courts of justice into acting one
way or the other on pending cases shall be allowed in the vicinity and/or within the premises of
any and all courts.
SO ORDERED.
G.R. No. L-30894 March 25, 1970
EDUARDO L. MARTELINO, CIRILO OROPESA, TEODORO FACELO, RUPERTO AMISOTO,
ALBERTO SOTECO, SOLFERINO TITONG, ET AL., petitioners,
vs.
JOSE ALEJANDRO, RUBEN S. MONTOYA, SIXTO R. ALHAMBRA, AVELINO C. MENEZ,
EFRAIN S. MACLANG, ET AL., respondents.
Amelito R. Mutuc for petitioners.
Colonel Manuel V. Reyes (Judge Advocate General, GSC), Major Samuel M. Soriano (JAGS),
Major Higinio E. Dacanay, Jr. (JAGS, PC) and Solicitor General Felix V. Makasiar, Assistant
Solicitor General Crispin V. Bautista, Solicitor Jaime M. Lantin and Guillermo Nakar, Jr. for
respondents.
CASTRO, J.:
This case presents another aspect of the court-martial proceedings against the petitioner, Major
Eduardo Martelino, alias Abdul Latif Martelino, of the Armed Forces of the Philippines, and the
officers and men under him, for violation of the 94th and 97th Articles of War, as a result of the
alleged shooting on March 18, 1968 of some Muslim recruits then undergoing commando
training on the island of Corregidor. Once before the question was raised before this Court
whether the general court-martial, convened on April 6, 1968 to try the case against the
petitioners, acquired jurisdiction over the case despite the fact that earlier, on March 23, a
complaint for frustrated murder had been filed in the fiscal's office of Cavite City by Jibin Arula
(who claimed to have been wounded in the incident) against some of the herein petitioners. The
proceedings had to be suspended until the jurisdiction issue could be decided. On June 23,
1969 this Court ruled in favor of the jurisdiction of the military court. 1
The jurisdiction question thus settled, attention once again shifted to the general court-martial,
but no sooner had the proceedings resumed than another hitch developed. This came about as
the petitioners, the accused in the court-martial proceedings, in turn came to this Court, seeking
relief against certain orders of the general court-martial.
It appears that at the hearing on August 12, 1969 the petitioner Martelino sought the
disqualification of the President of the general court-martial, following the latter's admission that
he read newspaper stories of the Corregidor incident. The petitioner contended that the case
had received such an amount of publicity in the press and other news media and in fact was
being exploited for political purposes in connection with the presidential election on November
11, 1969 as to imperil his right to a fair trial. After deliberating, the military court denied the
challenge.
Thereafter the petitioners raised peremptory challenges against Col. Alejandro, as president of
the court-martial, and Col. Olfindo, Lt. Col. Camagay, Lt. Col. Valones, Lt. Col. Blanco and Col.
Malig, as members. With regard to peremptory challenges it was the petitioners' position that for
each specification each accused was entitled to one such challenge. They later changed their
stand and adopted that of the trial judge advocate that "for each specification jointly tried, all of
the accused are entitled to only 1 peremptory challenge; and that with respect to the
specifications tried commonly, each one of the accused is entitled to one peremptory challenge."
They there contended that they were entitled to a total of eleven peremptory challenges. On the
other hand the court-martial ruled that the accused were entitled to only one peremptory
challenge as the specifications were being jointly tried.
The petitioners therefore filed this petition for certiorari and prohibition, to nullify the orders of the
court-martial denying their challenges, both peremptory and for cause. They allege that the
adverse publicity given in the mass media to the Corregidor incident, coupled with the fact that it
became an issue against the administration in the 1969 elections, was such as to unduly
influence the members of the court-martial. With respect to peremptory challenges, they contend
that they are entitled to eleven such challenges, one for each specification.
On August 29, 1969 this Court gave due course to the petition, required the respondents as
members of the general court-martial to answer and, in the meantime, restrained them from
proceeding with the case.
In their answer the respondents assert that despite the publicity which the case had received, no
proof has been presented showing that the court-martial's president's fairness and impartiality
have been impaired. On the contrary, they claim, the petitioner's own counsel expressed
confidence in the "integrity, experience and background" of the members of the court. As a
preliminary consideration, the respondents urge this Court to throw out the petition on the
ground that it has no power to review the proceedings of the court-martial, "except for the
purpose of ascertaining whether the military court had jurisdiction of the person and subject
matter, and whether, though having such jurisdiction, it had exceeded its powers in the sentence
pronounced," and that at any rate the petitioners failed to exhaust remedies available to them
within the military justice system.
I
It is true that civil courts as a rule exercise no supervision or correcting power over the
proceedings of courts-martial, and that mere errors in their proceedings are not open to
consideration. "The single inquiry, the test, is jurisdiction."2 But it is equally true that in the
exercise of their undoubted discretion, courts-martial may commit such an abuse of discretion —
what in the language of Rule 65 is referred to as "grave abuse of discretion" — as to give rise to
a defect in their jurisdiction.3 This is precisely the point at issue in this action suggested by its
nature as one for certiorari and prohibition, namely, whether in overruling the petitioners'
challenges, the general court-martial committed such an abuse of discretion as to call for the
exercise of the corrective powers of this Court. It is thus obvious that no other way is open to this
Court by which it may avoid passing upon the constitutional issue thrust upon it. Nor will the fact
that there may be available remedies within the system of military justice bar review considering
that the questions raised are questions of law.4
And so the threshold question is whether the publicity given to the case against the petitioners
was such as to prejudice their right to a fair trial. As already stated, the petitioner Martelino
challenged the court-martial president on the ground that newspaper accounts of what had come
to be referred to as the "Corregidor massacre" might unduly influence the trial of their case. The
petitioner's counsel referred to a news item appearing in the July 29, 1969 issue of the Daily
Mirror and cited other news reports to the effect that "coffins are being prepared for the
President (of the Philippines) in Jolo," that according to Senator Aquino "massacre victims were
given sea burial," and that Senator Magsaysay, opposition Vice President candidate, had gone
to Corregidor and "found bullet shells." In addition the petitioners cite in this Court a Manila
Times editorial of August 26, 1969 which states that "The Jabidah [code name of the training
operations] issue was bound to come up in the course of the election campaign. The opposition
could not possibly ignore an issue that is heavily loaded against the administration." The
petitioners argue that under the circumstances they could not expect a just and fair trial and that,
in overruling their challenge for cause based on this ground, the general court-martial committed
a grave abuse of discretion. In support of their contention they invoke the rulings of the United
States Supreme Court in Irvin v. Dowd,5 Rideau vs. Louisiana,6 Estes v. Texas,7 and Shepard v.
Maxwell.8
An examination of the cases cited, however, will show that they are widely disparate from this
case in a fundamental sense. In Irvin, for instance, the Supreme Court found that shortly after
the petitioner's arrest in connection with six murders committed in Vanderburgh County, Indiana,
the prosecutor and police officials issued press releases stating that the petitioner had
confessed to the six murders and that "a barrage of newspaper headlines articles, cartoons and
pictures was unleashed against him during the six or seven months preceding his trial." In
reversing his conviction, the Court said:
Here the "pattern of deep and bitter prejudice' shown to be present
throughout the community, ... was clearly reflected in the sum total of
the voir dire examination of a majority of the jurors finally placed in the jury
box. Eight out of the 12 thought petitioner was guilty. With such an opinion
permeating their minds, it would be difficult to say that each could exclude
this preconception of guilt from his deliberations. The influence that lurks in
an opinion once formed is so persistent that it unconsciously fights
detachment from the processes of the average man. ... Where one's life is
at stake — and accounting for the frailties of human nature — we can only
say that in the light of the circumstances here the finding of impartiality does
not meet the constitutional standard.9
Irvin marks the first time a state conviction was struck down solely on the ground of prejudicial
publicity. 10 In the earlier case of Shepherd v. Florida, 11 which involved elements of publicity,
the reversal of the conviction was based solely on racial discrimination in the selection of the
jury, although to concurring Justice Jackson, who was joined by Justice Frankfurter, "It is hard to
imagine a more prejudicial influence than a press release by the officer of the court charged with
defendants' custody stating that they had confessed, and here just such a statement unsworn to,
unseen, uncross-examined and uncontradicted, was conveyed by the press to the jury. 12
In Rideau, the petitioner, suspect in the robbery of a bank in Lake Charles, Louisiana and in the
kidnapping of three of its employees, and in the killing of one of them, was similarly given "trial
by publicity." Thus, the day after his arrest, a moving picture film was taken of him in an
"interview" with the sheriff. The "interview," which lasted approximately 20 minutes, consisted of
interrogation by the sheriff and admission by Rideau that he had perpetrated the bank robbery,
kidnapping and murder. The interview was seen and heard on television by 24,000 people. Two
weeks later he was arraigned. His lawyers promptly moved for a change of venue but their
motion was denied and Rideau was convicted and sentenced to death. Rideau's counsel had
requested that jurors be excused for cause, having exhausted all of their peremptory challenges,
but these challenges for cause had been denied by the trial judge. In reversing his conviction,
the Court said:
[W]e hold that it was a denial of due process of law to refuse the request for
a change of venue, after the people of Calcasieu Parish had been exposed
repeatedly and in depth to the spectacle of Rideau personally confessing in
detail to the crimes with which he was later to be charged. For anyone who
has ever watched television the conclusion cannot be avoided that this
spectacle, to the tens of thousands of people who saw and heard it, in a
very real sense was Rideau's trial — at which he pleaded guilty to murder.
Any subsequent court proceedings in a community so pervasively exposed
to such a spectacle could be but a hollow formality. 13
In the third case, Estes, the Court voided a televised criminal trial for being inherently a denial of
due process.
The state ... says that the use of television in the instant case was "without
injustice to the person immediately concerned," basing its position on the
fact that the petitioner has established no isolate prejudice and that this
must be shown in order to invalidate a conviction in these circumstances.
The State paints too broadly in this contention, for this Court itself has found
instances in which a showing of actual prejudice is not a prerequisite to
reversal. This is such a case. It is true that in most cases involving claims of
due process deprivations we require a showing of identifiable prejudice to
the accused. Nevertheless, at times a procedure employed by the State
involves such a probability that prejudice will result that it is inherently
lacking in due process. 14
In Sheppard, the celebrated murder case of Sam Sheppard, who was accused of the murder of
his wife Marilyn, the Supreme Court observed a "carnival atmosphere" in which "bedlam reigned
at the courthouse ... and newsmen took over practically the entire courtroom, hounding most of
the participants in the trial, especially Sheppard." It observed that "despite the extent and nature
of the publicity to which the jury was exposed during the trial, the judge refused defense
counsel's other requests that the jury be asked whether they had read or heard specific
prejudicial comment about the case. ... In these circumstances, we assume that some of this
material reached members of the jury." The Court held:
From the cases coming here we note that unfair and prejudicial news
comment on pending trials has become increasingly prevalent. Due process
requires that the accused receive a trial by an impartial jury free from
outside influences. Given the pervasiveness of modern communications and
the difficulty of effacing prejudicial publicity from the minds of the jurors, the
trial courts must take strong measures to ensure that the balance is never
weighed against the accused. And appellate tribunals have the duty to make
an independent evaluation of the circumstances. Of course, there is nothing
that proscribes the press from reporting events that transpire in the
courtroom. But where there is a reasonable likelihood that prejudicial news
prior to trial will prevent a fair trial, the judge should continue the case until
the threat abates, or transfer it to another county not so permeated with
publicity. In addition sequestration of the jury was something the judge
should have sua sponte with counsel. If publicity during the proceeding
threatens the fairness of the trial, a new trial should be ordered. But we
must remember that reversals are but palliatives; the cure lies in those
remedial measures that will prevent the prejudice at its inception. The courts
must take such steps by rule and regulation that will protect their processes
from prejudicial outside interference. Neither prosecutors, counsel for
defense, the accused, witnesses, court staff nor enforcement officers
coming under the jurisdiction of the court should be permitted to frustrate its
function. Collaboration between counsel and the press as to information
affecting the fairness of a criminal trial is not only subject to regulation, but is
highly censurable and worthy of disciplinary measure. 15
In contrast the spate of publicity in this case before us did not focus on the guilt of the petitioners
but rather on the responsibility of the Government for what was claimed to be a "massacre" of
Muslim trainees. If there was a "trial by newspaper" at all, it was not of the petitioners but of the
Government. Absent here is a showing of failure of the court-martial to protect the accused from
massive publicity encouraged by those connected with the conduct of the trial 16 either by a
failure to control the release of information or to remove the trial to another venue or to postpone
it until the deluge of prejudicial publicity shall have subsided. Indeed we cannot say that the trial
of the petitioners was being held under circumstances which did not permit the observance of
those imperative decencies of procedure which have come to be identified with due process.
At all events, even granting the existence of "massive" and "prejudicial" publicity, since the
petitioners here do not contend that the respondents have been unduly influenced but simply
that they might be by the "barrage" of publicity, we think that the suspension of the court-martial
proceedings has accomplished the purpose sought by the petitioners' challenge for cause, by
postponing the trial of the petitioner until calmer times have returned. The atmosphere has since
been cleared and the publicity surrounding the Corregidor incident has so far abated that we
believe the trial may now be resumed in tranquility.
II
Article of War 18 provides that "Each side shall be entitled to one peremptory challenge, but the
law member of the court shall not be challenged except for cause." The general court-martial
originally interpreted this provision to mean that the entire defense was entitled to only
one peremptory challenge. Subsequently, on August 27, 1969, it changed its ruling and held that
the defense was entitled to eight peremptory challenges, but the petitioners declined to exercise
their right to challenge on the ground that this Court had earlier restrained further proceedings in
the court-martial.
It is the submission of the petitioners that "for every charge, each side may exercise one
peremptory challenge," and therefore because there are eleven charges they are entitled to
eleven separate peremptory challenges. The respondents, upon the other hand, argue that "for
each specification jointly tried, all of the accused are entitled to only one peremptory challenge
and that with respect to specifications tried commonly each of the accused is entitled to one
peremptory challenge." Although there are actually a total of eleven specifications against the
petitioners, three of these should be considered as merged with two other specifications, "since
in fact they allege the same offenses committed in conspiracy, thus leaving a balance of eight
specifications." The general court-martial thereof takes the position that all the 23 petitioners are
entitled to a total of only eight peremptory challenges.
We thus inescapably confront, and therefore now address, the issue here posed.
We are of the view that both the petitioners and the general court-martial misapprehend the true
meaning, intent and scope of Article of War 18. As will hereinafter be demonstrated, each of the
petitioners is entitled as a matter of right to one peremptory challenge. The number of
specifications and/or charges, and whether the accused are being jointly tried or undergoing a
common trial, are of no moment.
In the early formative years of the infant Philippine Army, after the passage in 1935 of
Commonwealth Act No. 1 (otherwise known as the National Defense Act), except for a handful
of Philippine Scout officers and graduates of the United States military and naval academies
who were on duty with the Philippine Army, there was a complete dearth of officers learned in
military law, this aside from the fact that the officer corps of the developing army was numerically
inadequate for the demands of the strictly military aspects of the national defense program.
Because of these considerations it was then felt that peremptory challenges should not in the
meanwhile be permitted and that only challenges for cause, in any number, would be allowed.
Thus Article 18 of the Articles of War (Commonwealth Act No. 408), as worded on September
14, 1938, the date of the approval of the Act, made no mention or reference to any peremptory
challenge by either the trial judge advocate of a court-martial or by the accused. After December
17, 1958, when the Manual for Courts-Martial 17 of the Philippine Army became effective, the
Judge Advocate General's Service of the Philippine Army conducted a continuing and intensive
program of training and education in military law, encompassing the length and breadth of the
Philippines. This program was pursued until the outbreak of World War II in the Pacific on
December 7, 1941. After the formal surrender of Japan to the allies in 1945, the officer corps of
the Armed Forces of the Philippines had expanded to a very large number, and a great many of
the officers had been indoctrinated in military law. It was in these environmental circumstances
that Article of War 18 was amended on June 12, 1948 to entitle "each side" to one peremptory
challenge, with the sole proviso that "the law member of court shall not be challenged except for
cause."
By its very inherent nature a peremptory challenge does not require any reason or ground
therefor to exist or to be stated. It may be used before, during, or after challenges for cause, or
against a member of the court-martial unsuccessfully challenged for cause, or against a new
member if not previously utilized in the trial. A member challenged peremptorily is forthwith
excused from duty with the court-martial.
The right of challenge comes from the common law with the trial by jury itself, and has always
been held essential to the fairness of trial by jury. 18
As was said by Blackstone, and repeated by Mr. Justice Story: 'In criminal
cases, or at least in capital ones, there is in favorem vitae, allowed to the
prisoner an arbitrary and capricious species of challenge to a certain
number of jurors, without showing any cause at all, which is called a
peremptory challenge; a provision full of that tenderness and humanity to
prisoners, for which our English laws are justly famous. This is grounded on
two reasons: 1) As every one must be sensible, what sudden impression
and unaccountable prejudices we are apt to conceive upon the bare looks
and gestures of another; and how necessary it is that a prisoner (when put
to defend his life) should have a good opinion of his jury, the want of which
might totally disconcert him; the law has conceived a prejudice even without
being able to assign a reason for his dislike. 2) Because, upon challenges
for cause shown, if the reason assigned prove insufficient to set aside the
juror, perhaps the bare questioning his indifference may sometimes provoke
a resentment, to prevent all ill consequences from which, the prisoner is still
at liberty, if he pleases, peremptorily to set him aside.' 19
The right to challenge is in quintessence the right to reject, not to select. If from the officers who
remain an impartial military court is obtained, the constitutional right of the accused to a fair trial
is maintained. ... 20
As we have hereinbefore stated, each of the 23 petitioners (accused before the general court-
martial) is entitled to one peremptory challenge, 21 irrespective of the number of specifications
and/or charges and regardless of whether they are tried jointly or in common. Three overriding
reasons compel us to this conclusion.
First, a peremptory challenge is afforded to an accused who, whether rightly or wrongly, honestly
feels that the member of the court peremptorily challenged by him cannot sit in judgment over
him, impartially. Every accused person is entitled to a fair trial. It is not enough that objectively
the members of the court may be fair and impartial. It is likewise necessary that subjectively the
accused must feel that he is being tried by a fair and impartial body of officers. Because the
petitioners may entertain grave doubts as to the fairness or impartiality of distinct, separate and
different individual members of the court-martial, it follows necessarily that each of the accused
is entitled to one peremptory challenge.
Second, Article of War 18 does not distinguish between common trials and joint trials, nor does it
make the nature or number of specifications and/or charges a determinant. Reference is made
by the respondents here to US military law, in support of their argument that for each
specification jointly tried all of the accused are entitled to only one peremptory challenge and
with respect to all specifications tried in common each of the accused is entitled to one
peremptory challenge. We have carefully scrutinized U.S. military law, and it is unmistakable
from our reading thereof that each accused person, whether in a joint or common trial,
unquestionably enjoys the right to one peremptory challenge. 22
Third, a perceptive analysis of the companion articles 23 to Article 18 convinces us that the
word, "each side," as used in the said article in reference to the defense, should be construed to
mean each accused person. Thus, Articles of War 17 (Trial Judge Advocate to Prosecute;
Counsel to Defend), 19 (Oath), 21 (Refusal or Failure to Plead), 28 (Court to Announce Action),
29 (Closed Sessions), 30 (Method of Voting), and 36 (Irregularities — Effect of), unequivocally
speak of and refer to the "accused" in the singular.
ACCORDINGLY, subject to our pronouncement that each of the 23 petitioners is entitled to one
separate peremptory challenge, the present petition is denied. The temporary restraining order
issued by this Court on August 29, 1969 is hereby lifted. No pronouncement as to costs. .
G.R. No. L-12871 July 25, 1959
TIMOTEO V. CRUZ, petitioner,
vs.
FRANCISCO G. H. SALVA, respondent.
Baizas and Balderrama for petitioner.
City Attorney Francisco G. H. Salva in his own behalf.
MONTEMAYOR, J.:
This is a petition for certiorari and prohibition with preliminary injunction filed by Timoteo V. Cruz
against Francisco G. H. Salva, in his capacity as City Fiscal of Pasay City, to restrain him from
continuing with the preliminary investigation he was conducting in September, 1957 in
connection with the killing of Manuel Monroy which took place on June 15, 1953 in Pasay City.
To better understand the present case and its implications, the following facts gathered from the
pleadings and the memoranda filed by the parties, may be stated.
Following the killing of Manuel Monroy in 1953 a number of persons were accused as involved
and implicated in said crime. After a long trial, the Court of First Instance of Pasay City found
Oscar Castelo, Jose de Jesus, Hipolito Bonifacio, Bienvenido Mendoza, Francis Berdugo and
others guilty of the crime of murder and sentenced them to death. They all appealed the
sentence although without said appeal, in view of the imposition of the extreme penalty, the case
would have to be reviewed automatically by this Court. Oscar Castelo sought a new trial which
was granted and upon retrial, he was again found guilty and his former conviction of sentence
was affirmed and reiterated by the same trial court.
It seems that pending appeal, the late President Magsaysay ordered a reinvestigation of the
case. The purpose of said reinvestigation does not appear in the record. Anyway, intelligence
agents of the Philippine Constabulary and investigators of Malacañang conducted the
investigation for the Chief Executive, questioned a number of people and obtained what would
appear to be confession, pointing to persons, other than those convicted and sentenced by the
trial court, as the real killers of Manuel Monroy.
Counsel for Oscar Castelo and his co-defendants wrote to respondent Fiscal Salva to conduct a
reinvestigation of the case presumably on the basis of the affidavits and confessions obtained by
those who had investigated the case at the instance of Malacañang. Fiscal Salva conferred with
the Solicitor General as to what steps he should take. A conference was held with the Secretary
of Justice who decided to have the results of the investigation by the Philippine Constabulary
and Malacañang investigators made available to counsel for the appellants.
Taking advantage of this opportunity, counsel for the appellants filed a motion for new trial with
this Tribunal supporting the same with the so-called affidavits and confessions of some of those
persons investigated, such as the confessions of Sergio Eduardo y de Guzman, Oscar Caymo,
Pablo Canlas, and written statements of several others. By resolution of this Tribunal, action on
said motion for new trial was deferred until the case was studied and determined on the merits.
In the meantime, the Chief, Philippine Constabulary, head sent to the Office of Fiscal Salva
copies of the same affidavits and confessions and written statements, of which the motion for
new trial was based, and respondent Salva proceeded to conduct a reinvestigation designating
for said purposes a committee of three composed of himself as chairman and Assistant City
Attorneys Herminio A. Avendañio and Ernesto A. Bernabe.
In connection with said preliminary investigation being conducted by the committee, petitioner
Timoteo Cruz was subpoenaed by respondent to appear at his office on September 21, 1957, to
testify "upon oath before me in a certain criminal investigation to be conducted at the time and
place by this office against you and Sergio Eduardo, et al., for murder." On September 19, 1957,
petitioner Timoteo Cruz wrote to respondent Salva asking for the transfer of the preliminary
investigation from September 21, due to the fact that this counsel, Atty. Crispin Baizas, would
attend a hearing on that same day in Naga City. Acting upon said request for postponement,
Fiscal Salva set the preliminary investigation on September 24. On that day, Atty. Baizas
appeared for petitioner Cruz, questioned the jurisdiction of the committee, particularly
respondent Salva, to conduct the preliminary investigation in view of the fact that the same case
involving the killing of Manuel Monroy was pending appeal in this Court, and on the same day
filed the present petition for certiorari and prohibition. This Tribunal gave due course to the
petition for certiorari and prohibition and upon the filing of a cash bond of P200.00 issued a writ
of preliminary injunction thereby stopping the preliminary investigation being conducted by
respondent Salva.
The connection, if any, that petitioner Cruz had with the preliminary investigation being
conducted by respondent Salva and his committee was that affidavits and confessions sent to
Salva by the Chief, Philippine Constabulary, and which were being investigated, implicated
petitioner Cruz, even picturing him as the instigator and mastermind in the killing of Manuel
Monroy.
The position taken by petitioner Cruz in this case is that inasmuch as the principal case
of People vs. Oscar Castelo, et al., G.R. No. L-10794, is pending appeal and consideration
before us, no court, much less a prosecuting attorney like respondent Salva, had any right or
authority to conduct a preliminary investigation or reinvestigation of the case for that would be
obstructing the administration of justice and interferring with the consideration on appeal of the
main case wherein appellants had been found guilty and convicted and sentenced; neither had
respondent authority to cite him to appear and testify at said investigation.
Respondent Salva, however, contends that if he subpoenaed petitioner Cruz at all, it was
because of the latter's oral and personal request to allow him to appear at the investigation with
his witnesses for his own protection, possibly, to controvert and rebut any evidence therein
presented against him. Salva claims that were it not for this request and if, on the contrary,
Timoteo Cruz had expressed any objection to being cited to appear in the investigation he
(Salva) would never have subpoenaed him.
Although petitioner Cruz now stoutly denies having made such request that he be allowed to
appear at the investigation, we are inclined to agree with Fiscal Salva that such a request had
been made. Inasmuch as he, Timoteo Cruz, was deeply implicated in the killing of Manuel
Monroy by the affidavits and confessions of several persons who were being investigated by
Salva and his committee, it was but natural that petitioner should have been interested, even
desirous of being present at that investigation so that he could face and cross examine said
witnesses and affiants when they testified in connection with their affidavits or confessions,
either repudiating, modifying or ratifying the same. Moreover, in the communication, addressed
to respondent Salva asking that the investigation, scheduled for September 21, 1957, be
postponed because his attorney would be unable to attend, Timoteo Cruz expressed no
opposition to the subpoena, not even a hint that he was objecting to his being cited to appear at
the investigation.
As to the right of respondent Salva to conduct the preliminary investigation which he and his
committee began ordinarily, when a criminal case in which a fiscal intervened though nominally,
for according to respondent, two government attorneys had been designed by the Secretary of
Justice to handle the prosecution in the trial of the case in the court below, is tried and decided
and it is appealed to a higher court such as this Tribunal, the functions and actuations of said
fiscal have terminated; usually, the appeal is handled for the government by the Office of the
Solicitor General. Consequently, there would be no reason or occasion for said fiscal to conduct
a reinvestigation to determine criminal responsibility for the crime involved in the appeal.
However, in the present case, respondent has, in our opinion, established a justification for his
reinvestigation because according to him, in the original criminal case against Castelo, et al.,
one of the defendants named Salvador Realista y de Guzman was not included for the reason
that he was arrested and was placed within the jurisdiction of the trial court only after the trial
against the other accused had commenced, even after the prosecution had rested its case and
the defense had begun to present its evidence. Naturally, Realista remained to stand trial. The
trial court, according to respondent, at the instance of Realista, had scheduled the hearing at an
early date, that is in August, 1957. Respondent claims that before he would go to trial in the
prosecution of Realista he had to chart his course and plan of action, whether to present the
same evidence, oral and documentary, presented in the original case and trial, or, in view of the
new evidence consisting of the affidavits and confessions sent to him by the Philippine
Constabulary, he should first assess and determine the value of said evidence by conducting an
investigation and that should he be convinced that the persons criminally responsible for the
killing of Manuel Monroy were other than those already tried and convicted, like Oscar Castelo
and his co-accused and co-appellants, including Salvador Realista, then he might act
accordingly and even recommend the dismissal of the case against Realista.
In this, we are inclined to agree with respondent Salva. For, as contended by him and as
suggested by authorities, the duty and role of prosecuting attorney is not only to prosecute and
secure the conviction of the guilty but also to protect the innocent.
We cannot overemphasize the necessity of close scrutiny and investigation of the
prosecuting officers of all cases handled by them, but whilst this court is averse to any
form of vacillation by such officers in the prosecution of public offenses, it is
unquestionable that they may, in appropriate cases, in order to do justice and avoid
injustice, reinvestigate cases in which they have already filed the corresponding
informations. In the language of Justice Sutherland of the Supreme Court of the
United States, the prosecuting officer "is the representative not of an ordinary party to
a controversy, but of a sovereignty whose obligation to govern impartially is as
compelling as its obligation to govern at all; and whose interest, therefore, in a criminal
prosecution is not that it shall win a case, but that justice shall be done. As such, he is
in a peculiar and very definite sense the servant of the law, the twofold aim of which is
that guilt shall not escape nor innocent suffer. He may prosecute with earnestness and
vigor — indeed, he should do so. But, while he may strike had blows, he is not at
liberty to strike foul ones. It is as much his duty to refrain from improper methods
calculated to produce a wrongful conviction as it is to use every legitimate means to
bring about a just one. (69 United States law Review, June, 1935, No. 6, p. 309, cited
in the case of Suarez vs. Platon, 69 Phil., 556)
With respect to the right of respondent Salva to cite petitioner to appear and testify before him at
the scheduled preliminary investigation, under the law, petitioner had a right to be present at that
investigation since as was already stated, he was more or less deeply involved and implicated in
the killing of Monroy according to the affiants whose confessions, affidavits and testimonies
respondent Salva was considering or was to consider at said preliminary investigation. But he
need not be present at said investigation because his presence there implies, and was more of a
right rather than a duty or legal obligation. Consequently, even if, as claimed by respondent
Salva, petitioner expressed the desire to be given an opportunity to be present at the said
investigation, if he latter changed his mind and renounced his right, and even strenuously
objected to being made to appear at said investigation, he could not be compelled to do so.
Now we come to the manner in which said investigation was conducted by the respondent. If, as
contended by him, the purpose of said investigation was only to acquaint himself with and
evaluate the evidence involved in the affidavits and confessions of Sergio Eduardo, Cosme
Camo and others by questioning them, then he, respondent, could well have conducted the
investigation in his office, quietly, unobtrusively and without much fanfare, much less publicity.
However, according to the petitioner and not denied by the respondent, the investigation was
conducted not in respondent's office but in the session hall of the Municipal Court of Pasay City
evidently, to accommodate the big crowd that wanted to witness the proceeding, including
members of the press. A number of microphones were installed. Reporters were everywhere
and photographers were busy taking pictures. In other words, apparently with the permission of,
if not the encouragement by the respondent, news photographers and newsmen had a filed day.
Not only this, but in the course of the investigation, as shown by the transcript of the
stenographic notes taken during said investigation, on two occasions, the first, after Oscar
Caymo had concluded his testimony respondent Salva, addressing the newspapermen said,
"Gentlemen of the press, if you want to ask questions I am willing to let you do so and the
question asked will be reproduced as my own"; and the second, after Jose Maratella y de
Guzman had finished testifying and respondent Salva, addressing the newsmen, again said,
"Gentlemen of the press is free to ask questions as ours." Why respondent was willing to
abdicate and renounce his right and prerogative to make and address the questions to the
witnesses under investigation, in favor of the members of the press, is difficult for us to
understand, unless he, respondent, wanted to curry favor with the press and publicize his
investigation as much as possible. Fortunately, the gentlemen of the press to whom he accorded
such unusual privilege and favor appeared to have wisely and prudently declined the offer and
did not ask questions, this according to the transcript now before us.
But, the newspapers certainly played up and gave wide publicity to what took place during the
investigation, and this involved headlines and extensive recitals, narrations of and comments on
the testimonies given by the witnesses as well as vivid descriptions of the incidents that took
place during the investigation. It seemed as though the criminal responsibility for the killing of
Manuel Monroy which had already been tried and finally determined by the lower court and
which was under appeal and advisement by this Tribunal, was being retried and redetermined in
the press, and all with the apparent place and complaisance of respondent.
Frankly, the members of this Court were greatly disturbed and annoyed by such publicity and
sensationalism, all of which may properly be laid at the door of respondent Salva. In this, he
committed what was regard a grievous error and poor judgment for which we fail to find any
excuse or satisfactory explanation. His actuations in this regard went well beyond the bounds of
prudence, discretion and good taste. It is bad enough to have such undue publicity when a
criminal case is being investigated by the authorities, even when it being tried in court; but when
said publicity and sensationalism is allowed, even encouraged, when the case is on appeal and
is pending consideration by this Tribunal, the whole thing becomes inexcusable, even abhorrent,
and this Court, in the interest of justice, is constrained and called upon to put an end to it and a
deterrent against its repetition by meting an appropriate disciplinary measure, even a penalty to
the one liable.
Some of the members of the Court who appeared to feel more strongly than the others favored
the imposition of a more or less severe penal sanction. After mature deliberation, we have finally
agreed that a public censure would, for the present, be sufficient.
In conclusion, we find and hold that respondent Salva was warranted in holding the preliminary
investigation involved in this case, insofar as Salvador Realista is concerned, for which reason
the writ of preliminary injunction issued stopping said preliminary investigation, is dissolved; that
in view of petitioner's objection to appear and testify at the said investigation, respondent may
not compel him to attend said investigation, for which reason, the subpoena issued by
respondent against petitioner is hereby set aside.
In view of the foregoing, the petition for certiorari and prohibition is granted in part and denied in
part. Considering the conclusion arrived at by us, respondent Francisco G. H. Salva is hereby
publicly reprehended and censured for the uncalled for and wide publicity and sensationalism
that he had given to and allowed in connection with his investigation, which we consider and find
to be contempt of court; and, furthermore, he is warned that a repetition of the same would meet
with a more severe disciplinary action and penalty. No costs.
CANON 14
[G.R. No. 120043. July 24, 1996]
AMERICAN HOME ASSURANCE CO. and/or LESLIE J. MOUAT, President, petitioners,
vs. NATIONAL LABOR RELATIONS COMMISSION, LABOR ARBITER PATRICIO
P. LIBO-ON and ROMEO F. DE LEON, respondents.
DECISION
REGALADO, J.:
Private respondent Romeo F. de Leon was a branch manager of petitioner companys
office in Caloocan City receiving a monthly salary of P12,000.00.[1] He started working in the
company on June 1, 1974 and became the companys branch manager of its Caloocan office on
January 1, 1986.[2] In their desire to streamline and restructure the companys organization and
rationalize its operations, petitioners offered a Special Early Retirement Program (SERP) [3] to all
its regular employees. The said program called for the voluntary separation/retirement of the
employees in exchange for cash payments consisting of two months basic salary for every year
of service and a lump sum of P50,000.00. The Company, however, reserved for itself the sole
discretion to approve or deny applications under the program.
The program was initially offered by the company from March 13 to 29, 1989 to its
employees. A letter from the president of the company was sent to private respondent on March
13, 1989 informing the latter of the opening of the SERP and inviting him to participate in the
program. On March 20, 1989, private respondent accordingly submitted an application for early
retirement[4] but the same was denied on March 31, 1989 by the company on the ground that its
operational requirements needed his continuous employment.[5]
In the meantime, Carlos Valin, a marketing assistant of Philippine American General
Insurance (Philamgen), Caloocan Service Office, was transferred on June 1, 1989 to petitioner
companys Caloocan branch with the position of assistant manager, while private respondent
remained as branch manager.[6]Philamgen was one of petitioner companys two sister companies
at that time.[7] Sometime in 1989, petitioner company and Philamgen entered into a
merger[8] resulting in the absorption of some of the employees of the former by the latter. [9]
On December 19, 1989, a memorandum [10] addressed to all employees of the company
and signed by petitioner Leslie J. Mouat was issued announcing the last and final re-opening of
the SERP for the period from December 19 to 31, 1989. The program was re-offered to the
employees because it was determined that there still exists a limited number of redundancies in
the organization resulting from the recent restructuring of operations of American Home,
PhilHome (another sister company) and Philamgen after a review of the manpower requirements
of the company.
Private respondent applied anew under the program on December 21, 1989.[11] In a follow-
up letter of January 4, 1990, private respondent informed petitioner Mouat of the reasons why he
wanted to retire under the SERP. He explained that there was a redundancy in the Caloocan
office since the merger because, aside from him, Carlos Valin had also been performing the
functions of branch manager in the office. Secondly, he believed that he could be more
productive as an agent of petitioner company if allowed to retire early. [12]
On the same day, petitioner company again denied his application for the same reason
that it gave in denying his first application.[13] Private respondent wrote to the company on
February 12, 1990 to reconsider its decision denying his second application. [14]
It turned out that in an earlier letter dated January 11, 1991, petitioners had prepared a
notice of termination of employment[15] for private respondent effective February 1, 1991 based
on the ground that his position as a branch manager had been determined to be a duplication of
another persons job, for which reason his position was declared redundant. In that notice,
private respondent was informed that he would be getting two months basic pay for every year
of service as separation pay, but no mention was made of the lump sum bonus of P50,000.00
under the program.
In reply thereto, private respondent wrote petitioners a letter on January 30, 1991 [16] asking
for the retirement bonus of P50,000.00, his prorated mid-year bonus, the money value of his
vacation leaves, and 65% of his unused current sick leaves, all in addition to the separation pay
stated in the notice of termination. He submitted that he was entitled to the additional benefits
under the SERP because the ground for termination of his services - redundancy of position -
was precisely a ground for management to accept his application for retirement under the SERP,
and that he had twice applied therefor under that program. It does not appear that petitioners
acted affirmatively on that letter.
Upon his receipt on February 7, 199l of the separation pay provided in the notice of
termination amounting to P331,896.61, private respondent executed a release, waiver and
quitclaim wherein, as therein stated, he acknowledged receipt of the above amount as full
settlement of any and all claims he may have against the company arising from the companys
retirement plan, agreement or contract relating to or arising from any and all incidents of his
employment with the company.[17]
On or about the first week of May, 1991, petitioners again offered the SERP to its
employees but, by this time, private respondent was no longer with the company because of his
prior separation therefrom.On May 14, 1991, private respondent wrote once more to the
company to reiterate his claim for the SERP bonus of P50,000.00.[18] This claim of private
respondent was denied by petitioners in a letter dated August 8, 1991 [19] wherein the company
contended that the P50,000.00 bonus was only effective and coterminous with the SERP.
Hence, without any more recourse available to him within the company, private
respondent filed before respondent commission on August 12, 1991 a complaint against
petitioners for illegal layoff,[20] docketed therein as NLRC Case No. NCR 00-08-04706-91, and
prayed for reinstatement and the payment of moral and actual damages, with attorneys fees. It
was alleged in the complaint that the layoff was in contravention of the Labor Code and was
carried out in a whimsical and capricious manner.
 Labor Arbiter Patricio P. Libo-on, to whom the complaint was assigned, rendered a
decision on December 11, 1992 holding that the termination of private respondents employment
was in violation of Article 283 of the Labor Code. Consequent to such finding, back wages in the
total amount of P60,000.00 were awarded in favor of private respondent, corresponding to the
time when his services were terminated on February 1, 1991 until the closure of the branch
where he was employed on June 30, 1991. In addition, petitioners were ordered to pay private
respondent the lump sum bonus of P50,000.00 which he should have received under the SERP,
with legal interest thereon, and 10% thereof as and for attorneys fees.[21]
On July 30, 1993, petitioners appealed the decision of the labor arbiter to the National
Labor Relations Commission (NLRC) which, in its resolution dated April 10, 1995, affirmed the
award of the P50,000.00 lump sum bonus under the SERP and the attorneys fees granted by
the labor arbiter. However, the finding of the labor arbiter that there was illegal dismissal was
rejected and the consequent awards of back wages and legal interest were ordered vacated and
set aside by the Commission.[22]
The NLRC upheld the award of the bonus of P50,000.00 under the SERP on the theory
that entitlement to the said lump sum vested in private respondent the first time he applied to
qualify and retire under the SERP. It held that the waiver and quitclaim executed by private
respondent, as earlier mentioned, cannot operate as a bar to this particular claim because they
only pertained to the separation pay given by the company, whereas the claim for the bonus was
still pending final resolution by petitioners when private respondent executed that waiver and
quitclaim.
Dissatisfied, petitioners filed the present petition for certiorari to have the above resolution
annulled.Their assignment of errors postulate that the NLRC committed grave abuse of
discretion amounting to lack or excess of jurisdiction in ruling that (l) private respondent De Leon
had a vested right over the P50,000.00 bonus under the SERP despite its finding that his
separation was for a valid cause, and (2) the waiver and quitclaim cannot operate as a bar to the
claim for the bonus because they only pertained to the separation pay. [23]
Petitioners insist that since private respondents employment was validly terminated under
Article 283 of the Labor Code, as found by the NLRC, then the benefits to which he is entitled
should be limited to those provided for by said article. For their employees to be entitled to the
benefits of the SERP, they must retire under its coverage and effectivity. Petitioners further
argue that it is erroneous, inconsistent and illogical for the NLRC to rule that private respondent
had acquired a vested right in the bonus provided in the SERP and, at the same time, declare
that there was a valid termination. Also, they claim that there was grave abuse of discretion on
the part of public respondent in alternatively awarding the bonus to private respondent on the
basis of the alleged bad faith of petitioners in dismissing private respondent.They assert that
they acted honestly in denying the application of private respondent for early retirement.
Under their second assignment of error, petitioners contend that the release, waiver and
quitclaim cannot be considered by the NLRC as inoperative because they involve and represent
a reasonable settlement and that the one who executed it is not an unsuspecting or a gullible
person. In addition, they posit the view that the additional claim of private respondent is already
barred by his waiver and quitclaim under the principle of estoppel.
Petitioners missed the point essentially comprehended in their first assignment of error. To
determine whether or not the NLRC abused its discretion under such attribution of error, the
issue to be determined is the entitlement of private respondent to the announced bonus
of P50,000.00 and not the validity of private respondents separation under Article 283 of the
Labor Code. The finding of a valid dismissal and the award of the bonus are not inconsistent
with or exclusive of each other. The former refers to the mode of separation while the latter deals
with the rights of private respondent under the SERP.
Although under the factual milieu of this case private respondents services were validly
terminated under Article 283 of the Labor Code, under the same circumstances his entitlement
to benefits consequent thereto are not limited to those provided by said provision of
law. Otherwise, the provisions of collective bargaining agreements, individual employment
contracts, and voluntary retirement plans of companies would be rendered inutile if we were to
limit the award of monetary benefits to an employee only to those provided by statute. Thus, to
ensure that the benefits conferred upon the employee by such contracts and plans are ultimately
awarded to him, Article 217 of the Labor Code vests jurisdiction in labor arbiters and the NLRC
to adjudicate and grant relief in claims for money arising from employer-employee relations
exceeding P5,000.00.
While we are aware that labor laws do not confer management authority on the labor
arbiter, the NLRC, or even the courts, there are certain limitations to the wide discretion of the
employer in the conduct of his business. For instance, in Wiltshire File Co., Inc. vs. National
Labor Relations Commission, et al.,[24] we held that:
x x x. The characterization of private respondents services as no longer necessary or
sustainable, and therefore properly terminable, was an exercise of business judgment on the
part of petitioner company. The wisdom or soundness of such characterization or decision was
not subject to discretionary review on the part of the Labor Arbiter nor of the NLRC so long, of
course, as violation of law or merely arbitrary and malicious action is not shown.
xxx xxx xxx
The determination of the continuing necessity of a particular officer or position in a business
corporation is managements prerogative, and the courts will not interfere with the exercise of
such so long as no abuse of discretion or merely arbitrary or malicious action on the part of
management is shown (Emphases ours).
Again, in Master Iron Labor Union (MILU), et al. vs. National Labor Relations Commission,
et al.,[25] it was stressed that:
While it is true that an employers exercise of management prerogatives, with or without reason,
does not per seconstitute unjust discrimination, such exercise, if clearly shown to be in grave
abuse of discretion, may be looked into by the courts. Indeed, the hiring, firing, transfer,
demotion, and promotion of employees are traditionally identified as management
prerogatives. However, they are not absolute management prerogatives. They are subject to
limitations found in law, a collective bargaining agreement, or general principles of fair play and
justice (Italics supplied).
Hence, the phrase found in the SERP that participation therein is subject to the sole
discretion and approval of the Company does not and cannot necessarily mean absolute or
unlimited discretion.[26]Petitioners may not simply deny private respondents two applications for
early retirement with the corresponding benefits thereof and then later fire him on the ground of
redundancy, without thereby abusing their discretion or violating the principles of fair play and
justice. Petitioners themselves acknowledged the existence of redundancy in the company even
prior to the date of private respondents separation under Article 283. This is shown by the
phrase there still exists a limited number of redundancies in the organization contained in the
letter of petitioner Mouat[27] in offering for the second time the SERP to all employees of
petitioners.
Besides, the labor arbiter himself already made a finding in his decision that there was a
redundancy in the discharge of the functions of the branch manager in petitioner companys
Caloocan office by both Valin and private respondent. We see no overriding reason to reverse
this finding. It has long been settled that factual findings of labor administrative officials, if
supported by substantial evidence, are entitled not only to great respect but even to finality,
unless there is a showing that the labor arbiter and the NLRC simply and arbitrarily disregarded
evidence before them or had misapprehended evidence of such nature as to compel a contrary
conclusion if properly appreciated.[28]
 In Escareal vs. National Labor Relations Commission, et al., [29] we explained the concept
of redundancy by saying -
x x x that redundancy, for purposes of the Labor Code, exists where the services of an employee
are in excess of what is reasonably demanded by the actual requirements of the enterprise; a
position is redundant when it is superfluous, and superfluity of a position or positions may be the
outcome of a number of factors, such as the overhiring of workers, a decreased volume of
business or the dropping of a particular product line or service activity previously manufactured
or undertaken by the enterprise. Redundancy in an employers personnel force, however, does
not necessarily or even ordinarily refer to duplication of work. That no other person was holding
the same position which the dismissed employee held prior to the termination of his services
does not show that his position had not become redundant (Emphasis supplied).
It logically follows, therefore, that it was not even necessary that Valin be also designated
as branch manager of the Caloocan office in order that redundancy would exist. It was enough
that he likewise performed virtually the same functions, duties and responsibilities of private
respondent as branch manager, as was duly proven before the labor arbiter.
Although this will not affect our eventual resolution of this case, we nonetheless do not
unqualifiedly agree with the conclusion of the labor arbiter and the NLRC that the right to the
bonus of P50,000.00 vested in private respondent on the first time that he applied for early
retirement. When private respondent initially applied therefor on March 20, 1989, it was possible
that no redundancy existed yet since Valin was assigned to the Caloocan Office only on June 1,
1989. To be more accurate, it was on private respondents second application on December 21,
1989 that private respondent should have been considered as having obtained a fixed and
complete right over the said lump sum bonus.
By that time, another person was already exercising the functions of private respondent
and the SERP was offered for the second time purposely to eliminate such redundancy, hence
private respondent unquestionably qualified for and acquired a vested right over the benefits of
the SERP upon his second application. Such right cannot be curtailed or diminished by
petitioners by retaining an unreasonable option to do so. Employees have a vested and
demandable right over existing benefits voluntarily granted to them by their employer. The latter
may not unilaterally withdraw, eliminate or diminish such benefits. [30]
To reiterate, private respondent failed to retire under the SERP and to get the benefits
provided thereunder through acts exclusively imputable to his employer. Petitioners twice denied
his application although he was very much qualified for and desirous of early retirement on the
ground specified by petitioners. Then he was unceremoniously fired from the company for the
very same reason which should have justly warranted and required the acceptance of his
applications in the first place. Worse, although petitioners declared that the second offer of the
SERP was the last or final opportunity for availing thereof, the same program was offered for
the third time after private respondent was already separated from the company and,
necessarily, could no longer apply for the benefits thereunder.
Petitioners denied the grant of the bonus to private respondent because, according to
them, the condition for its grant is that the employee must retire under the SERP. Yet, it was the
unjust denial of his applications and the re-offering of the SERP after he was separated from the
company that prevented private respondent from complying with such condition for early
retirement. As petitioners, being the employers-obligors, voluntarily prevented the fulfillment of
the condition by their own acts, private respondent is deemed to have fulfilled the condition for
early retirement under the SERP.[31]
We cannot find any justifiable reason for petitioners denial of private respondents second
application.Their proffered justification that the services of private respondent were still needed
by the company impresses us as being superficial and contrived when viewed in the light of
subsequent events. There was already another person capably catering to the needs of
petitioner companys existing clientele; hence, to grant private respondents application would not
in any way prejudice the continued and steady operations of the company. The unjustified denial
of private respondents application and the third offering of the SERP after private respondents
separation from the company lead to no other conclusion but that his separation shortly after the
rejection of his second application was designed to deprive him of the bonus which he could
have received under the program had his application been justly granted.
When private respondents services were terminated on the ground of redundancy,
petitioners impliedly acknowledged that the former was decidedly qualified to retire under the
SERP and to avail of its benefits since that was exactly the same ground for retirement under
the SERP. Consequently, the logical deduction that forcefully submits itself is that petitioners
ingeniously schemed to terminate private respondents employment for redundancy, instead of
having him retire on the same ground of redundancy, since the latter mode of separation
entailed payment of a bonus of P50,000.00.
A reading of the assailed resolution of the NLRC will show that public respondent did not
in any way grant the P50,000.00 bonus as an alternative for the award of damages. Hence,
petitioners objection on this ground is without basis and does not deserve any consideration. It
was the Solicitor General who suggested that the award of P50,000.00 be sustained as an
alternative for moral and exemplary damages, but that was not made the basis for the award by
the NLRC of the bonus or its ratiocination for the grant thereof.
The fact that private respondent signed a document of waiver and quitclaim does not bar
him from pursuing the P50,000.00 bonus under the SERP. His receipt of the separation pay and
the execution of the release documents cannot militate against him. That acceptance of
separation pay does not amount to estoppel, and the satisfaction receipt does not result in a
waiver. The law does not consider as valid any agreement to receive less compensation than
what a worker is entitled to recover nor prevent him from demanding benefits to which he is
entitled. Quitclaims executed by employees are thus commonly frowned upon as contrary to
public policy and ineffective to bar claims for the full measure of the workers legal
rights,[32] considering the economic disadvantage of the employee and the inevitable pressure
upon him by financial necessity.
The exception to the nullity of quitclaims enunciated in Cruz vs. National Labor Relations
Commission, et al.,[33] invoked by petitioners but which is actually an obiter dictum therein, is not
applicable to and cannot operate in the present case. Although some of the requisites mentioned
in the aforementioned case for the application of the exception appear to be present,. it cannot
be said that the quitclaim executed by herein private respondent was in consideration or by
reason of a fairly reasonable settlement of his claims. Private respondent was still shortchanged
by a not insignificant amount of P50,000.00, and there is no showing that he received any
equivalent benefits or privileges in exchange for his waiver of that bonus. Being unreasonable,
the quitclaim signed by private respondent is invalid and cannot be enforced against him.
Petitioners would wish this Court to believe that they had been very generous to private
respondent by paying more than what the law requires as separation pay. They emphasize that,
under the law, private respondent would have been entitled to only one month salary for every
year of service by way of separation pay, yet they instead granted him two months pay for each
year. What petitioners pass upon sub silentio is that under the terms of the SERP, as noted at
the outset, the program also granted two months basic salary for every year of service, aside
from the bonus of P50,000,00. Private respondent would, therefore, have received the same
separation pay had he been allowed to retire. In other words, the amount claimed by petitioners
to have been paid by them as an act of munificence is exactly the same amount they would have
been made to pay as a matter of contract law, and more.
One cautionary afterword. This opinion should not be construed as constituting a judicial
straitjacket on employers when confronted by the problem of redundancy in their
employees positions, or that employers do not enjoy freedom of selection in the dismissal of
employees in case of redundancy.Employers continue to enjoy the privilege to conscientiously
determine for themselves the existence of redundancy in their establishments and their
necessary exercise of management prerogatives shall be upheld whenever justifiable. Such
management prerogatives, however, are not unlimited and the exercise thereof must be done in
good faith, otherwise it shall be subject to administrative and judicial review. Such review, in
turn, shall invariably consider the particular facts of each case and be guided by the principle
that the law, in protecting the rights of the laborer, neither authorizes oppression nor self-
destruction of the employer.
ON ALL THE FOREGOING CONSIDERATIONS, the petition at bar is DISMISSED and
the judgment of respondent National Labor Relations Commission is hereby AFFIRMED in toto.
SO ORDERED.
CANON 15
A.C. No. 378 March 30, 1962
JOSE G. MEJIA and EMILIA N. ABRERA, complainants,
vs.
FRANCISCO S. REYES, respondent.
PADILLA, J.:
This is a disbarment proceedings against attorney Francisco S. Reyes for malpractice.
On 27 September 1947, Francisco S. Reyes, a practicing lawyer, was appointed bank attorney
and notary public for the Baguio Branch of the Philippine National Bank (Exhibit H), as follows:
Atty. Francisco S. Reyes
Baguio City, Mt. Province
(Thru: The Manager, Phil. National Bank
Baguio Branch) .
Sir:
Please be advised that you are hereby appointed as Bank Attorney and Notary Public
of our Baguio Branch, effective September 19, 1947, and as such you are to perform
the following: .
1) To ratify documents covering bank transactions;
2) To represent the Bank in cases filed in the local courts when, in the
opinion of the Government Corporation Counsel, there is a necessity for an
attorney for the purpose; and
3) To give legal advise on ordinary routinary matters to our Branch Manager
thereat and sign collection letters when so requested by the latter.
It is understood that you shall receive no regular compensation from the Bank but that
you will be allowed to collect fees authorized by the Notarial Law when ratifying
documents and 5% of the amount of judgment in cases where your appearance for
the Bank is requested, if and when actually collected, which fees, however, may be
changed as circumstances may warrant. Furthermore, it is also understood that under
this appoinment,you are not entitled to any other form of compensation or privileges
accorded to regularly appointed employees of this Bank.
Yours very truly, .
(Sgd.) V. CARMONA
President
I AGREE:
(Sgd.) FRANCISCO S. REYES
In June 1955 while still holding such position his professional services were engaged by Jose G.
Mejia and Emilia N. Abrera, residents of Baguio City, to bring an action in court against the
Philippine National Bank and the Rehabilitation Finance Corporation (now the Development
Bank of the Philippines) as successor-in-interest of the defunct Agricultural and Industrial Bank
for the cancellation of a mortgage on a parcel of land situated in Baguio City recorded on their
certificate of title No. 2499 (civil No. 532). On 28 June 1955 a complaint, signed by Attorney
Francisco S. Reyes for the law firm of Reyes and Cabato, was filed in the Court of First Instance
of Baguio against the two banks, praying that the sum in Japanese war notes of P2,693.53 paid
on 27 October 1944 by Jose G. Mejia and Emilia N. Abrera to the Agricultural and Industrial
Bank and received by the Philippines National Bank, Baguio Branch, to pay the balance of real
estate mortgage loan, be credited by the Rehabilitation Finance Corporation as successor-in-
interest of the defunct Agricultural and Industrial Bank and that the mortgage annotated on
transfer certificate of title No. 2499 be cancelled (Exhibit A). After trial, on 4 August 1956 the
Court rendered judgment declaring valid the payment in Japanese war notes of P2,693.53 on 27
October 1944 but crediting only the sum of P67.34, Philippine currency, the equivalent value of
P2,693.53 under the Ballantyne Schedule (Exhibit 8). On 31 August 1956 the Reyes and Cabato
law firm filed a motion for reconsideration (Exhibit 9) and the Philippine National Bank on 5
September 1956 (Exhibit 10), to which on 15 September 1956 the former filed a written objection
(Exhibit 11). On 15 September 1956 the Court denied both motion for reconsideration (Exhibit
12). No appeal was taken by either party.
In this administrative proceedings, the complainants Jose G. Mejia and Emilia N. Abrera allege
that they had desired to take an appeal from the judgment rendered by the Court of First
Instance of Baguio but did not, upon the respondent's advice; that thereafter for the first time
they learned that the respondent was counsel and notary public of the Baguio Branch of the
Philippine National Bank; that his representing them against the Philippine National Bank, in
whose Baguio Branch he was bank attorney and notary public, without revealing to them such
connection with the Bank, constitutes malpractice; and pray this Court to disbar him.
In his answer filed on 2 March 1959 respondent Francisco S. Reyes avers that after a
conference among the complainants, attorney Federico L. Cabato and himself, they agreed not
to appeal the judgment rendered by the Court and, instead, to take advantage of the provisions
of Republic Act No. 1286 that condoned interests accruing on debts to the Government provided
that the principal was paid on or before 31 December 1956; that all the time he was handling
their case the complainants knew his professional connection with the Baguio Branch of the
Philippine National Bank; that he worked hard with attorney Cabato on their case, for which he
was paid by them a meager sum of P90 as attorney fees; that he is not guilty of malpractice,
because he was not a retainer lawyer of the Philippine National Bank but represented it only in
collection cases where he was paid 5% of any amount collected; that the malpractice charge is
just to harrass, embarrass and force him to pay the complainants' debt to the Rehabilitation
Finance Corporation; and praysthat the complaint be dismissed..
On 4 March 1959 the Court referred the administrative case to the City Attorney of Baguio for
investigation, report and recommendation. After conducting the investigation during which the
parties presented their evidence, on 23 March 1960, Sixto A. Domondo, City Attorney of Baguio,
rendered a report finding the respondent guilty of malpractice and recommending
reprimand..1äwphï1.ñët
Lawyers are prohibited from representing conflicting interests in a case (Cantorne vs. Ducusin,
57 Phil. 23 and In re: De la Rosa, 27 Phil. 258). The respondent's act of appearing and acting as
counsel for the complainantsJose G. Mejia and Emilia N. Abrera in the civil case against the
Philippine National Bank, that had appointed him bank attorney and notary public, constitutes
malpractice. However, it does not appear satisfactorily proventhat during the pendency of their
case the complaints did not know of the respondents connection with the bank as attorney and
notary public. On the other hand, it appears that notwithstanding the letter dated 21 July 1955
written by Mr. L.D. Herrera, manager of the BaguioBranch, quoting a part of a previous letter
sent to him (Herrera) by attorney Ramon B. de los Reyes, chief legal counsel of the Philippine
National Bank, stating that —
We note that the complaint is signed by our Bank Attorney and Notary Public, Atty.
Francisco S. Reyes, in behalf of the Law Office of Reyes and Cabato. Needless to
say, it is unethical for Atty. Reyes, who is presently the attorney of the Bank, to
represent the plaintiffs here whose interest are diametrically opposed to those of the
Bank. As this is certainly embarrassing both for Atty. Reyes and for the Bank, it is
requested that you please take this matter with Atty. Reyes with the end in view of
advising him to desist from representing the plaintiffs in this case, otherwise, we will
be compelled, much to our regret, to recommend severance of his official connection
with this Bank,.
which shows that the Philippine National Bank knew that the respondent was appearing as
counsel for the complainants, yet it did not revoke or cancel his appointment as bank attorney
and notary public; that in the civil case the respondent did not appear as counsel for the Bank
which was represented by attorneys Ramon B. de los Reyes and Nemesio P. Libunao; that no
appeal was taken from the judgment rendered by the Court of First Instance of Baguio, because
the complainants had chosen to pay the principal of their loan on or before 31 December 1956 in
order that the interests thereon be condoned as provided for in Republic Act No. 1286 (Exhibits
13 to 17); and that the respondent was deeply devoted to his duties as counsel for the
complainants and collected a very small attorney's fees of P90, the malpractice committed by
the respondent is not so serious. He is just admonished and warned not to repeat it.
A.C. No. 396 July 31, 1964
IN THE MATTER OF THE PETITION FOR THE DISBARMENT OF ATTORNEY EDUARDO M.
TUASON. EMILIO C. STA. MARIA, petitioner.
PAREDES, J.:
Sometime in June, 1955, respondent Atty. Eduardo M. Tuason represented petitioner Emilio C.
Sta. Maria. and his two partners Andres Guanzon and Fausto E. Chincuanco in prosecuting Civil
Case No. 894, CFI of Pampanga, entitled "Fausto E. Chincuanco, et al. v. Enriqueta M. de
Hidalgo, et al", a collection case involving a promissory note of P50,000.00. Defendant Enriqueta
M. de Hidalgo was declared in default, and the Court rendered judgment on October 8, 1955,
ordering the defendant de Hidalgo to pay: —
(a) Plaintiffs the sum of P30,000.00 with interests thereon at the rate of six percent
(6%) per annum from June 18, 1955, the date of the filing of the complaint, until the
same shall have been fully paid, plus the sum of P3,500.00 as plaintiffs' attorney's
fees;
(b) Plaintiff Andres A. Guanzon the other sum of P3,000.00 as compensation for the
injury caused to him in his credit standing; and
(c) Plaintiff Fausto E. Chincuanco another sum of P3,000.00 as compensation for the
injury caused to him in his credit standing.
On December 9, 1955, a writ of execution was issued. Sufficient amount of money to satisfy the
judgment, came into the hands of the Provincial Sheriff of Pampanga. Respondent Tuason, on
September 10, 1958, obtained from the Sheriff, the amount of P22,930.64, which he (Tuason)
applied in the following manner: (1) P10,000.00 for his alleged attorney's fees; (2) P1,648.00 to
supposed expenses of litigation, which he claimed to have advanced in the prosecution of the
case; and (3) the balance of P11,282.64, to plaintiff Fausto E. Chincuanco, his uncle.
Petitioner claims that respondent Tuason deprived him of his lawful share in the judgment which
was P25,511.62; that respondent was not entitled to P10,000.00 as attorney's fees because
even the lower court awarded him only P3,500.00; that the foregoing acts were done, without the
prior knowledge and consent of petitioner.
Upon finding that the respondent withdrew the P22,930.64 from the Office of the Provincial
Sheriff, complainant Sta. Maria repaired to the office of Atty. Tuason and demanded the amount
to be turned over to him, or to the Sheriff for proper disposition by the Court; that upon failure of
respondent to comply with any of the two things, contempt proceedings were instituted against
respondent Tuason. In view, however, of the claim of Tuason that he gave the money to
Guanzon and Chincuanco, petitioner filed with the CFI of Pampanga, Civil Case No. 1704,
against said Tuason, Guanzon and Chincuanco, for collection of his rightful share in the
judgment in Civil Case No. 894.
Respondent, in his Answer, admitted having received the amounts in question from the Sheriff of
Pampanga, and disbursed the same in the manner stated by petitioner, but he denied that he
obtained and disbursed the amounts, without the knowledge and consent of the petitioner; the
truth of the matter being that he was given full authority by petitioner's partners (Guanzon and
Chincuanco) to receive P10,000.00 for his services; that the two were the ones who engaged his
services in the prosecution of Civil Case No. 894, for their own behalf and in behalf of petitioner
himself; that he delivered the balance of the amount, to Chincuanco, who was the one who had
actually retained his services and who took charge of liquidating the accounts with his partners.
The matter was referred to the Office of the Solicitor General who made the following findings
and recommendations:
The foregoing evidence presented by the parties involves two issues, namely; (1)
Whether the respondent was in connivance with Fausto Chincuanco and Andres
Guanzon in delivering to them the full amount of P22,930.64 and thereby deprived the
petitioner from getting his rightful share in the liquidation of assets of the partnership
and (2) whether the respondent was guilty of malpractice and gross misconduct in
withholding the amount of P10,000 as his attorney's fees and also the amount of
P1,648 as alleged expenses in the litigation.
The complainant in this case contends that the respondent committed malpractice in
delivering the proceeds of the judgment money to Fausto Chincuanco, his uncle, and
Andres Guanzon, his close business associate (p. 17, tsn, July 10, 1961; p. 6, rec.).
As to the first issue, the petitioner claims that he was unable to collect his rightful
share in the liquidation of the funds of the partnership as agreed upon by the partners
(Exh. E, pp. 3-4, tsn, June 15, 1960) for which reason, he had to file a civil case
against his partners. He attributes this failure mainly to the respondent who delivered
the judgment money to Chincuanco, his partner, who disposed of the whole amount in
the manner already indicated earlier. While it is true that Fausto Chincuanco and
Guanzon, the latter being the general manager from the Sheriff (Exh. C, p. 14, rec.),
there is no clear evidence presented to show that the respondent connived with either
Chincuanco or Guanzon on delivering the judgment money to them for the purpose of
depriving the complainant of his rightful share in the partnership. What the respondent
did in this case was to deliver the judgment money to the partnership through
Chincuanco and Guanzons the latter being the general manager. The proper action
for the complainant was to demand his share from Guanzon, the managing partner, or
from Chincuanco, the other partner. This he did by filing a complaint in the Court of
First Instance of Pampanga (see Civil Case No. 1704, Exh. 2). In this case Atty.
Eduardo Tuason, the herein respondent, was included as defendant. A contempt
proceeding was also filed by complainant, citing Atty. Tuason and the Sheriff of
Pampanga as respondents. It appears, however, that an amicable settlement was
finally agreed upon by the parties in this civil case resulting in a compromise
agreement, duly approved by the Court of First Instance of Pampanga, wherein the
plaintiff waived all his claim against his other partners. In said compromise agreement
the plaintiff also agreed not to proceed with the contempt case he filed against Atty.
Tuason and the Sheriff of Pampanga (Exhs. 2, 3 and 5, folder of exhibits).
The issue, therefore, revolves more on the division of the partnership assets rather
than on the right of the complainant to compel the respondent to turn over to him part
of the judgment money which respondent applied as his attorney's fees and
reimbursement for his expenses in connection with the litigation he handled for the
partners. Under the foregoing circumstances, the undersigned investigator is of the
opinion that the respondent Tuason has not committed any act that will constitute
malpractice or gross misconduct in office.
Wherefore, the parties respectfully pray that the foregoing stipulation of facts be
admitted and approved by this Honorable Court, without prejudice to the parties
adducing other evidence to prove their case not covered by this stipulation of
facts. 1äwphï1.ñët
As to the second issue, there is no dispute that the respondent collected the amount
of P10,000 as attorney's fees for a collection suit in the amount of P50,000.00 based
on a promissory note. It appears that since the defendant was declared in default, the
case was terminated after one brief hearing. The respondent also collected P1,648 as
alleged expenses incurred in connection with the litigation. No satisfactory evidence,
however, was presented to show that the respondent actually spent that amount. On
the other hand, there was the undisputed evidence which shows that the case
represented by the respondent was terminated with one brief hearing after the
defendant was declared in default. There is, likewise, no dispute that said attorney's
fees and litigation expenses were deducted from the judgment money collected by the
respondent from the Sheriff of Pampanga. This act of the respondent seems to be
irregular, if not suspicious, considering his close relationship with Mr. Chincuanco.
Notwithstanding the opinion of Mr. Guanzon, the amount of P10,000 for attorney's
fees is, to our mind, also unreasonable under the circumstances. It is to be noted in
this connection that the respondent himself alleged in the complaint he filed for the
partnership that "the plaintiffs will incur for attorney's fees and expenses of the
litigation P6,000" (u 9, Rec.).
Moreover, the circumstances of the case show that the respondent took advantage of
the fact that he was a nephew of Fausto Chincuanco and a close associate of Andres
Guanzon in collecting his lawyer's fees. Even at the time that the respondent was
already representing the partnership, the complainant inquired from Chincuanco about
the respondent's fees. In reply Chincuanco said that he (Sta. Maria) should not worry
about it because the respondent is a nephew of his. On this assurance, the
complainant could be said to have assumed that the respondent would not collect an
excessive amount, much less take advantage of his relationship with one of the
partners by retaining the funds, considering that the case was one of a simple
collection based on a promissory note. The act of the respondent in collecting P10,000
for attorney's fees and alleged expenses he incurred in the litigation, aggravated the
burden of the complainant who claims that he was not given his due share in the
distribution of the assets of the partnership as his two partners were already in
possession of the money. While it is true that the partners of the complainant
apparently acceded to the respondent's acts, it cannot be denied that the latter acted
with indiscretion, induced by his close relationship with Chincuanco to the prejudice of
the complainant. In effect, respondent's act constituted a retention of the funds of his
client, an act of professional indiscretion bordering on misbehaviour.
Wherefore, the parties respectfully pray that the foregoing stipulation of facts be
admitted and approved by this Honorable Court, without prejudice to the parties
adducing other evidence to prove their case not covered by this stipulation of
facts. 1äwphï1.ñët
It may be stated, however, that the respondent may have felt justified in his acts, since
they were done with apparent acquiescence of his clients, Fausto Chincuanco and
Andres Guanzon. Moreover, an amicable settlement of all the suits filed by the herein
complainant resulted in a compromise agreement, whereby the complainant waived
any and all claims against his partners and the respondent arising from the
transactions which are the subject matter of the controversy, as well as from the
incidents thereof (Exh. 2, folder of exhibits). While it may be said that this compromise
agreement may not affect the misconduct of the respondent as a member of the bar,
at least, it cannot be denied that the complainant has, in effect, condoned
respondent's acts.
RECOMMENDATION
IN VIEW OF THE FOREGOING, it is respectfully recommended that instead of a more
severe penalty which he would otherwise deserve, the respondent be reprimanded for
professional indiscretion, with the warning that a more severe penalty be imposed for
a repetition of same or similar acts.
The report of the Solicitor General was duly set for hearing, by this Court. Respondent excepted
from the recommendation which called for the imposition of a reprimand. Respondent points out
that the findings of the Solicitor General did not warrant his recommendation, since he found that
respondent "has not committed any act that will constitute malpractice or gross misconduct in
office." Respondent also claims that the filing of different proceedings against him was simply
intended to harass and embarrass him, because of petitioner's dissatisfaction over the
disposition by his partners, of the award in Civil Case No. 894.
After an overall consideration of the facts and circumstances surrounding the case, We find that
the findings and conclusions of the Solicitor General are supported by the evidence of record.
The fact that the respondent has placed his private and personal interest over and above that of
his clients constitutes a breach of a lawyer's oath, to say the least. Call it professional
indiscretion or any other name, but the cold fact remains that the act, as found by the Solicitor
General, is not conducive to a healthy growth of the legal profession. The respondent is hereby
admonished that a repetition of similar acts will merit more drastic action.
 Wherefore, the parties respectfully pray that the foregoing stipulation of facts be admitted and
approved by this Honorable Court, without prejudice to the parties adducing other evidence to
prove their case not covered by this stipulation of facts.
1äwphï1.ñë[G.R. Nos. 115439-41. July 16, 1997]
PEOPLE OF THE PHILIPPINES, petitioner, vs. HONORABLE SANDIGANBAYAN,
MANSUETO V. HONRADA, CEFERINO S. PAREDES, JR. and GENEROSO S.
SANSAET, respondents.
DECISION
REGALADO, J.:
Through the special civil action for certiorari at bar, petitioner seeks the annulment of the
resolution of respondent Sandiganbayan, promulgated on December 22, 1993, which denied
petitioners motion for the discharge of respondent Generoso S. Sansaet to be utilized as a state
witness, and its resolution of March 7, 1994 denying the motion for reconsideration of its
preceding disposition.[1]
The records show that during the dates material to this case, respondent Honrada was the
Clerk of Court and Acting Stenographer of the First Municipal Circuit Trial Court, San Francisco-
Bunawan-Rosario in Agusan del Sur. Respondent Paredes was successively the Provincial
Attorney of Agusan del Sur, then Governor of the same province, and is at present a
Congressman. Respondent Sansaet was a practicing attorney who served as counsel for
Paredes in several instances pertinent to the criminal charges involved in the present recourse.
The same records also represent that sometime in 1976, respondent Paredes applied for
a free patent over Lot No. 3097-A, Pls-67 of the Rosario Public Land Subdivision Survey. His
application was approved and, pursuant to a free patent granted to him, an original certificate of
title was issued in his favor for that lot which is situated in the poblacion of San Francisco,
Agusan del Sur.
However, in 1985, the Director of Lands filed an action[2] for the cancellation of respondent
Paredes patent and certificate of title since the land had been designated and reserved as a
school site in the aforementioned subdivision survey. The trial court rendered
judgment[3] nullifying said patent and title after finding that respondent Paredes had obtained the
same through fraudulent misrepresentations in his application. Pertinently, respondent Sansaet
served as counsel of Paredes in that civil case.[4]
Consequent to the foregoing judgment of the trial court, upon the subsequent complaint of
the Sangguniang Bayan and the preliminary investigation conducted thereon, an information for
perjury[5] was filed against respondent Paredes in the Municipal Circuit Trial Court.[6] On
November 27, 1985, the Provincial Fiscal was, however, directed by the Deputy Minister of
Justice to move for the dismissal of the case on the ground inter alia of prescription, hence the
proceedings were terminated.[7] In this criminal case, respondent Paredes was likewise
represented by respondent Sansaet as counsel.
Nonetheless, respondent* Paredes was thereafter haled before the Tanodbayan for
preliminary investigation on the charge that, by using his former position as Provincial Attorney
to influence and induce the Bureau of Lands officials to favorably act on his application for free
patent, he had violated Section 3(a) of Republic Act No. 3019, as amended. For the third time,
respondent Sansaet was Paredes counsel of record therein.
On August 29, 1988, the Tanodbayan, issued a resolution[8] recommending the criminal
prosecution of respondent Paredes. Atty. Sansaet, as counsel for his aforenamed co-
respondent, moved for reconsideration and, because of its legal significance in this case, we
quote some of his allegations in that motion:
x x x respondent had been charged already by the complainants before the Municipal Circuit
Court of San Francisco, Agusan del Sur, went to jail on detention in 1984 under the same set of
facts and the same evidence x x x but said case after arraignment, was ordered dismissed by
the court upon recommendation of the Department of Justice. Copy of the dismissal order,
certificate of arraignment and the recommendation of the Department of Justice are hereto
attached for ready reference; thus the filing of this case will be a case of double jeopardy for
respondent herein x x x.[9] (Italics supplied.)
A criminal case was subsequently filed with the Sandiganbayan[10] charging respondent
Paredes with a violation of Section 3(a) of Republic Act No. 3019, as amended. However, a
motion to quash filed by the defense was later granted in respondent courts resolution of August
1, 1991[11] and the case was dismissed on the ground of prescription.
On January 23, 1990, one Teofilo Gelacio, a taxpayer who had initiated the perjury and
graft charges against respondent Paredes, sent a letter to the Ombudsman seeking the
investigation of the three respondents herein for falsification of public documents.[12] He claimed
that respondent Honrada, in conspiracy with his herein co-respondents, simulated and certified
as true copies certain documents purporting to be a notice of arraignment, dated July 1, 1985,
and transcripts of stenographic notes supposedly taken during the arraignment of Paredes on
the perjury charge.[13] These falsified documents were annexed to respondent Paredes motion
for reconsideration of the Tanodbayan resolution for the filing of a graft charge against him, in
order to support his contention that the same would constitute double jeopardy.
In support of his claim, Gelacio attached to his letter a certification that no notice of
arraignment was ever received by the Office of the Provincial Fiscal of Agusan del Sur in
connection with that perjury case; and a certification of Presiding Judge Ciriaco Ario that said
perjury case in his court did not reach the arraignment stage since action thereon was
suspended pending the review of the case by the Department of Justice.[14]
Respondents filed their respective counter-affidavits, but Sansaet subsequently discarded
and repudiated the submissions he had made in his counter-affidavit. In a so-called Affidavit of
Explanations and Rectifications,[15] respondent Sansaet revealed that Paredes contrived to have
the graft case under preliminary investigation dismissed on the ground of double jeopardy by
making it that the perjury case had been dismissed by the trial court after he had been arraigned
therein.
For that purpose, the documents which were later filed by respondent Sansaet in the
preliminary investigation were prepared and falsified by his co-respondents in this case in the
house of respondent Paredes. To evade responsibility for his own participation in the scheme,
he claimed that he did so upon the instigation and inducement of respondent Paredes. This was
intended to pave the way for his discharge as a government witness in the consolidated cases,
as in fact a motion therefor was filed by the prosecution pursuant to their agreement.
Withal, in a resolution[16] dated February 24, 1992, the Ombudsman approved the filing of
falsification charges against all the herein private respondents. The proposal for the discharge of
respondent Sansaet as a state witness was rejected by the Ombudsman on this evaluative legal
position:
x x x Taking his explanation, it is difficult to believe that a lawyer of his stature, in the absence of
deliberate intent to conspire, would be unwittingly induced by another to commit a crime. As
counsel for the accused in those criminal cases, Atty. Sansaet had control over the case theory
and the evidence which the defense was going to present.Moreover, the testimony or confession
of Atty. Sansaet falls under the mantle of privileged communication between the lawyer and his
client which may be objected to, if presented in the trial.
The Ombudsman refused to reconsider that resolution[17] and, ostensibly to forestall any
further controversy, he decided to file separate informations for falsification of public documents
against each of the herein respondents. Thus, three criminal cases,[18] each of which named one
of the three private respondents here as the accused therein, were filed in the graft
court. However, the same were consolidated for joint trial in the Second Division of the
Sandiganbayan.
As stated at the outset, a motion was filed by the People on July 27, 1993 for the
discharge of respondent Sansaet as a state witness. It was submitted that all the requisites
therefor, as provided in Section 9, Rule 119 of the Rules of Court, were satisfied insofar as
respondent Sansaet was concerned.The basic postulate was that, except for the eyewitness
testimony of respondent Sansaet, there was no other direct evidence to prove the confabulated
falsification of documents by respondents Honrada and Paredes.
Unfortunately for the prosecution, respondent Sandiganbayan, hewing to the theory of the
attorney-client privilege adverted to by the Ombudsman and invoked by the two other private
respondents in their opposition to the prosecutions motion, resolved to deny the desired
discharge on this ratiocination:
From the evidence adduced, the opposition was able to establish that client and lawyer
relationship existed between Atty. Sansaet and Ceferino Paredes, Jr., before, during and after
the period alleged in the information. In view of such relationship, the facts surrounding the case,
and other confidential matter must have been disclosed by accused Paredes, as client, to
accused Sansaet, as his lawyer in his professional capacity. Therefore, the testimony of Atty.
Sansaet on the facts surrounding the offense charged in the information is privileged.[19]
Reconsideration of said resolution having been likewise denied,[20] the controversy was
elevated to this Court by the prosecution in an original action for the issuance of the
extraordinary writ of certiorariagainst respondent Sandiganbayan.
The principal issues on which the resolution of the petition at bar actually turns are
therefore (1) whether or not the projected testimony of respondent Sansaet, as proposed state
witness, is barred by the attorney-client privilege; and (2) whether or not, as a consequence
thereof, he is eligible for discharge to testify as a particeps criminis.
I Statements and communications regarding the commission of a crime already
As already stated, respondent Sandiganbayan ruled that due to the lawyer-client
relationship which existed between herein respondents Paredes and Sansaet during the relevant
periods, the facts surrounding the case and other confidential matters must have been disclosed
by respondent Paredes, as client, to respondent Sansaet, as his lawyer. Accordingly, it found no
reason to discuss it further since Atty. Sansaet cannot be presented as a witness against
accused Ceferino S. Paredes, Jr. without the latters consent. [21]
The Court is of a contrary persuasion. The attorney-client privilege cannot apply in these
cases, as the facts thereof and the actuations of both respondents therein constitute an
exception to the rule. For a clearer understanding of that evidential rule, we will first sweep aside
some distracting mental cobwebs in these cases.
1. It may correctly be assumed that there was a confidential communication made by
Paredes to Sansaet in connection with Criminal Cases Nos. 17791-93 for falsification before
respondent court, and this may reasonably be expected since Paredes was the accused and
Sansaet his counsel therein.Indeed, the fact that Sansaet was called to witness the preparation
of the falsified documents by Paredes and Honrada was as eloquent a communication, if not
more, than verbal statements being made to him by Paredes as to the fact and purpose of such
falsification. It is significant that the evidentiary rule on this point has always referred to any
communication, without distinction or qualification. [22]
In the American jurisdiction from which our present evidential rule was taken, there is no
particular mode by which a confidential communication shall be made by a client to his
attorney. The privilege is not confined to verbal or written communications made by the client to
his attorney but extends as well to information communicated by the client to the attorney by
other means.[23]
Nor can it be pretended that during the entire process, considering their past and existing
relations as counsel and client and, further, in view of the purpose for which such falsified
documents were prepared, no word at all passed between Paredes and Sansaet on the subject
matter of that criminal act. The clincher for this conclusion is the undisputed fact that said
documents were thereafter filed by Sansaet in behalf of Paredes as annexes to the motion for
reconsideration in the preliminary investigation of the graft case before the Tanodbayan.[24] Also,
the acts and words of the parties during the period when the documents were being falsified
were necessarily confidential since Paredes would not have invited Sansaet to his house and
allowed him to witness the same except under conditions of secrecy and confidence.
2. It is postulated that despite such complicity of Sansaet at the instance of Paredes in the
criminal act for which the latter stands charged, a distinction must be made between confidential
communications relating to past crimes already committed, and future crimes intended to be
committed, by the client.Corollarily, it is admitted that the announced intention of a client to
commit a crime is not included within the confidences which his attorney is bound to
respect. Respondent court appears, however, to believe that in the instant case it is dealing with
a past crime, and that respondent Sansaet is set to testify on alleged criminal acts of
respondents Paredes and Honrada that have already been committed and consummated.
The Court reprobates the last assumption which is flawed by a somewhat inaccurate
basis. It is true that by now, insofar as the falsifications to be testified to in respondent court are
concerned, those crimes were necessarily committed in the past. But for the application of the
attorney-client privilege, however, the period to be considered is the date when the privileged
communication was made by the client to the attorney in relation to either a crime committed in
the past or with respect to a crime intended to be committed in the future. In other words, if the
client seeks his lawyers advice with respect to a crime that the former has theretofore
committed, he is given the protection of a virtual confessional seal which the attorney-client
privilege declares cannot be broken by the attorney without the clients consent. The same
privileged confidentiality, however, does not attach with regard to a crime which a client intends
to commit thereafter or in the future and for purposes of which he seeks the lawyers advice.
committed, made by a party who committed it, to an attorney, consulted as such,
are privileged communications. Contrarily, the unbroken stream of judicial dicta is to the effect
that communications between attorney and client having to do with the clients contemplated
criminal acts, or in aid or furtherance thereof, are not covered by the cloak of privileges ordinarily
existing in reference to communications between attorney and client.[25](Emphases supplied.)
3. In the present cases, the testimony sought to be elicited from Sansaet as state witness
are the communications made to him by physical acts and/or accompanying words of Paredes at
the time he and Honrada, either with the active or passive participation of Sansaet, were about
to falsify, or in the process of falsifying, the documents which were later filed in the Tanodbayan
by Sansaet and culminated in the criminal charges now pending in respondent
Sandiganbayan. Clearly, therefore, the confidential communications thus made by Paredes to
Sansaet were for purposes of and in reference to the crime of falsification which had not yet
been committed in the past by Paredes but which he, in confederacy with his present co-
respondents, later committed. Having been made for purposes of a future offense, those
communications are outside the pale of the attorney-client privilege.
 4. Furthermore, Sansaet was himself a conspirator in the commission of that crime of
falsification which he, Paredes and Honrada concocted and foisted upon the authorities. It is well
settled that in order that a communication between a lawyer and his client may be privileged, it
must be for a lawful purpose or in furtherance of a lawful end. The existence of an unlawful
purpose prevents the privilege from attaching.[26] In fact, it has also been pointed out to the Court
that the prosecution of the honorable relation of attorney and client will not be permitted under
the guise of privilege, and every communication made to an attorney by a client for a criminal
purpose is a conspiracy or attempt at a conspiracy which is not only lawful to divulge, but which
the attorney under certain circumstances may be bound to disclose at once in the interest of
justice.[27]
It is evident, therefore, that it was error for respondent Sandiganbayan to insist that such
unlawful communications intended for an illegal purpose contrived by conspirators are
nonetheless covered by the so-called mantle of privilege. To prevent a conniving counsel from
revealing the genesis of a crime which was later committed pursuant to a conspiracy, because of
the objection thereto of his conspiring client, would be one of the worst travesties in the rules of
evidence and practice in the noble profession of law.
II
On the foregoing premises, we now proceed to the consequential inquiry as to whether
respondent Sansaet qualifies, as a particeps criminis, for discharge from the criminal
prosecution in order to testify for the State. Parenthetically, respondent court, having arrived at a
contrary conclusion on the preceding issue, did not pass upon this second aspect and the relief
sought by the prosecution which are now submitted for our resolution in the petition at bar. We
shall, however, first dispose likewise of some ancillary questions requiring preludial clarification.
1. The fact that respondent Sandiganbayan did not fully pass upon the query as to
whether or not respondent Sansaet was qualified to be a state witness need not prevent this
Court from resolving that issue as prayed for by petitioner. Where the determinative facts and
evidence have been submitted to this Court such that it is in a position to finally resolve the
dispute, it will be in the pursuance of the ends of justice and the expeditious administration
thereof to resolve the case on the merits, instead of remanding it to the trial court.[28]
2. A reservation is raised over the fact that the three private respondents here stand
charged in three separate informations. It will be recalled that in its resolution of February 24,
1992, the Ombudsman recommended the filing of criminal charges for falsification of public
documents against all the respondents herein. That resolution was affirmed but, reportedly in
order to obviate further controversy, one information was filed against each of the three
respondents here, resulting in three informations for the same acts of falsification.
This technicality was, however, sufficiently explained away during the deliberations in this
case by the following discussion thereof by Mr. Justice Davide, to wit:
Assuming no substantive impediment exists to block Sansaets discharge as state witness, he
can, nevertheless, be discharged even if indicted under a separate information. I suppose the
three cases were consolidated for joint trial since they were all raffled to the Second Division of
the Sandiganbayan. Section 2, Rule XV of the Revised Rules of the Sandiganbayan allows
consolidation in only one Division of cases arising from the same incident or series of incidents,
or involving common questions of law and fact. Accordingly, for all legal intents and purposes,
Sansaet stood as co-accused and he could be discharged as state witness. It is of no moment
that he was charged separately from his co-accused. While Section 9 of Rule 119 of the 1985
Rules of Criminal Procedure uses the word jointly, which was absent in the old provision, the
consolidated and joint trial has the effect of making the three accused co-accused or joint
defendants, especially considering that they are charged for the same offense. In criminal law,
persons indicted for the same offense and tried together are called joint defendants.
As likewise submitted therefor by Mr. Justice Francisco along the same vein, there having
been a consolidation of the three cases, the several actions lost their separate identities and
became a single action in which a single judgment is rendered, the same as if the different
causes of action involved had originally been joined in a single action. [29]
Indeed, the former provision of the Rules referring to the situation (w)hen two or more
persons are charged with the commission of a certain offense was too broad and indefinite;
hence the word joint was added to indicate the identity of the charge and the fact that the
accused are all together charged therewith substantially in the same manner in point of
commission and time. The word joint means common to two or more, as involving the united
activity of two or more, or done or produced by two or more working together, or shared by or
affecting two or more.[30] Had it been intended that all the accused should always be indicted in
one and the same information, the Rules could have said so with facility, but it did not so require
in consideration of the circumstances obtaining in the present case and the problems that may
arise from amending the information. After all, the purpose of the Rule can be achieved by
consolidation of the cases as an alternative mode.
2. We have earlier held that Sansaet was a conspirator in the crime of falsification, and the
rule is that since in a conspiracy the act of one is the act of all, the same penalty shall be
imposed on all members of the conspiracy. Now, one of the requirements for a state witness is
that he does not appear to be the most guilty.[31] not that he must be the least guilty[32] as is so
often erroneously framed or submitted. The query would then be whether an accused who was
held guilty by reason of membership in a conspiracy is eligible to be a state witness.
To be sure, in People vs. Ramirez, et al.[33] we find this obiter:
It appears that Apolonio Bagispas was the real mastermind. It is believable that he persuaded
the others to rob Paterno, not to kill him for a promised fee. Although he did not actually commit
any of the stabbings, it was a mistake to discharge Bagispas as a state witness. All the
perpetrators of the offense, including him, were bound in a conspiracy that made them equally
guilty.
However, prior thereto, in People vs. Roxas, et al.,[34] two conspirators charged with five
others in three separate informations for multiple murder were discharged and used as state
witnesses against their confederates. Subsequent thereto, in Lugtu, et al. vs. Court of Appeals,
et al.,[35] one of the co-conspirators was discharged from the information charging him and two
others with the crime of estafa. The trial court found that he was not the most guilty as, being a
poor and ignorant man, he was easily convinced by his two co-accused to open the account with
the bank and which led to the commission of the crime.
On appeal, this Court held that the finding of respondent appellate court that Lugtu was
just as guilty as his co-accused, and should not be discharged as he did not appear to be not the
most guilty, is untenable. In other words, the Court took into account the gravity or nature of the
acts committed by the accused to be discharged compared to those of his co-accused, and not
merely the fact that in law the same or equal penalty is imposable on all of them.
Eventually, what was just somehow assumed but not explicitly articulated found
expression in People vs. Ocimar, et al.,[36] which we quote in extenso:
Ocimar contends that in the case at bar Bermudez does not satisfy the conditions for the
discharge of a co-accused to become a state witness. He argues that no accused in a
conspiracy can lawfully be discharged and utilized as a state witness, for not one of them could
satisfy the requisite of appearing not to be the most guilty. Appellant asserts that since accused
Bermudez was part of the conspiracy, he is equally guilty as the others.
We do not agree. First, there is absolute necessity for the testimony of Bermudez. For, despite
the presentation of four (4) other witnesses, none of them could positively identify the accused
except Bermudez who was one of those who pulled the highway heist which resulted not only in
the loss of cash, jewelry and other valuables, but even the life of Capt. Caeba, Jr. It was in fact
the testimony of Bermudez that clinched the case for the prosecution. Second, without his
testimony, no other direct evidence was available for the prosecution to prove the elements of
the crime. Third, his testimony could be, as indeed it was, substantially corroborated in its
material points as indicated by the trial court in its well-reasoned decision. Fourth, he does not
appear to be the most guilty. As the evidence reveals, he was only invited to a drinking party
without having any prior knowledge of the plot to stage a highway robbery. But even assuming
that he later became part of the conspiracy, he does not appear to be the most guilty. What the
law prohibits is that the most guilty will be set free while his co-accused who are less guilty will
be sent to jail. And by most guilty we mean the highest degree of culpability in terms of
participation in the commission of the offense and not necessarily the severity of the penalty
imposed. While all the accused may be given the same penalty by reason of conspiracy, yet one
may be considered least guilty if We take into account his degree of participation in the
perpetration of the offense. Fifth, there is no evidence that he has at any time been convicted of
any offense involving moral turpitude.
xxx
Thus, We agree with the observations of the Solicitor General that the rule on the discharge of
an accused to be utilized as state witness clearly looks at his actual and individual participation
in the commission of the crime, which may or may not have been perpetrated in conspiracy with
the other accused. Since Bermudez was not individually responsible for the killing committed on
the occasion of the robbery except by reason of conspiracy, it cannot be said then that
Bermudez appears to be the most guilty. Hence, his discharge to be a witness for the
government is clearly warranted. (Italics ours.)
The rule of equality in the penalty to be imposed upon conspirators found guilty of a
criminal offense is based on the concurrence of criminal intent in their minds and translated into
concerted physical action although of varying acts or degrees of depravity. Since the Revised
Penal Code is based on the classical school of thought, it is the identity of the mens rea which is
considered the predominant consideration and, therefore, warrants the imposition of the same
penalty on the consequential theory that the act of one is thereby the act of all.
Also, this is an affair of substantive law which should not be equated with the procedural
rule on the discharge of particeps criminis. This adjective device is based on other
considerations, such as the need for giving immunity to one of them in order that not all shall
escape, and the judicial experience that the candid admission of an accused regarding his
participation is a guaranty that he will testify truthfully. For those reasons, the Rules provide for
certain qualifying criteria which, again, are based on judicial experience distilled into a
judgmental policy.
III
The Court is reasonably convinced, and so holds, that the other requisites for the
discharge of respondent Sansaet as a state witness are present and should have been favorably
appreciated by the Sandiganbayan.
Respondent Sansaet is the only cooperative eyewitness to the actual commission of the
falsification charged in the criminal cases pending before respondent court, and the prosecution
is faced with the formidable task of establishing the guilt of the two other co-respondents who
steadfastly deny the charge and stoutly protest their innocence. There is thus no other direct
evidence available for the prosecution of the case, hence there is absolute necessity for the
testimony of Sansaet whose discharge is sought precisely for that purpose. Said respondent has
indicated his conformity thereto and has, for the purposes required by the Rules, detailed the
substance of his projected testimony in his Affidavit of Explanations and Rectifications.
His testimony can be substantially corroborated on its material points by reputable
witnesses, identified in the basic petition with a digest of their prospective testimonies, as
follows: Judge Ciriaco C. Ario, Municipal Circuit Trial Court in San Francisco, Agusan del Sur;
Provincial Prosecutor and Deputized Ombudsman Prosecutor Claudio A. Nistal; Teofilo Gelacio,
private complainant who initiated the criminal cases through his letter-complaint; Alberto Juvilan
of the Sangguniang Bayan of San Fernando, Agusan del Sur, who participated in the resolution
asking their Provincial Governor to file the appropriate case against respondent Paredes, and
Francisco Macalit, who obtained the certification of non-arraignment from Judge Ario.
On the final requirement of the Rules, it does not appear that respondent Sansaet has at
any time been convicted of any offense involving moral turpitude. Thus, with the confluence of all
the requirements for the discharge of this respondent, both the Special Prosecutor and the
Solicitor General strongly urge and propose that he be allowed to testify as a state witness.
This Court is not unaware of the doctrinal rule that, on this procedural aspect, the
prosecution may propose but it is for the trial court, in the exercise of its sound discretion, to
determine the merits of the proposal and make the corresponding disposition. It must be
emphasized, however, that such discretion should have been exercised, and the disposition
taken on a holistic view of all the facts and issues herein discussed, and not merely on the sole
issue of the applicability of the attorney-client privilege.
This change of heart and direction respondent Sandiganbayan eventually assumed, after
the retirement of two members of its Second Division [37]and the reconstitution thereof. In an
inversely anticlimactic Manifestation and Comment [38] dated June 14, 1995, as required by this
Court in its resolution on December 5, 1994, the chairman and new members
thereof [39] declared:
4) That the questioned Resolutions of December 22, 1993 and March 7, 1994 upon which the
Petition for Certiorarifiled by the prosecution are based, was penned by Associate Justice
Narciso T. Atienza and concurred in by the undersigned and Associate Justice Augusto M.
Amores;
5) That while the legal issues involved had been already discussed and passed upon by the
Second Division in the aforesaid Resolution, however, after going over the arguments submitted
by the Solicitor-General and re-assessing Our position on the matter, We respectfully beg leave
of the Honorable Supreme Court to manifest that We are amenable to setting aside the
questioned Resolutions and to grant the prosecutions motion to discharge accused Generoso
Sansaet as state witness, upon authority of the Honorable Supreme Court for the issuance of
the proper Resolution to that effect within fifteen (15) days from notice thereof.
WHEREFORE, the writ of certiorari prayed for is hereby granted SETTING ASIDE the
impugned resolutions and ORDERING that the present reliefs sought in these cases by
petitioner be allowed and given due course by respondent Sandiganbayan.
SO ORDERED.
CANON 16
A.C. No. 7965 November 13, 2013
AZUCENA SEGOVIA-RIBAYA, Complainant,
vs.
ATTY. BARTOLOME C. LAWSIN, Respondent.
RESOLUTION
PERLAS-BERNABE, J.:
For the Court’s resolution is an administrative complaint1 filed by Azucena Segovia-Ribaya
(complainant) against Atty. Bartolome C. Lawsin (respondent), the antecedents of which are
detailed as follows:
The Facts
On November 18, 2005, the parties entered into a retainership agreement2 (retainer) whereby
respondent undertook to, inter alia process the registration and eventually deliver, within a
period of six (6 ) months,3 the certificate of title over a certain parcel of land (subject land) in
favor of complainant acting as the representative of the Heirs of the late Isabel Segovia. In
connection therewith, respondent received from complainant the amounts of ₱15,000.00 and
₱39,000.004 to cover for the litigation and land registration expenses, respectively.
Notwithstanding the expenditure of the ₱39,000.00 given for registration expenses (subject
amount) and the lapse of more than three (3) years from the retainer’s date, complainant alleged
that respondent, without proper explanation, failed to fulfill his undertaking to register the subject
land and deliver to complainant the certificate of title over the same. As complainant was tired of
respondent’s excuses, she finally decided to just withdraw the subject amount from respondent.
For such purpose, she confronted the latter at his office and also subsequently sent him two (2)
demand letters,5 but all to no avail.6 Hence, complainant was prompted to file the instant
administrative complaint.
In his Comment,7 respondent admitted that he indeed received the subject amount from
complainant but averred that after receiving the same, the latter’s brother, Erlindo, asked to be
reimbursed the amount of ₱7,500.00 which the latter purportedly paid to the land
surveyor.8 Respondent likewise alleged that he later found out that he could not perform his
undertaking under the retainer because the ownership of the subject land was still under
litigation.9Finally, respondent stated that he wanted to return the balance of the subject amount
to complainant after deducting what Erlindo took from him, but was only prevented to do so
because he was maligned by complainant when she went to his office and there, shouted and
called him names in the presence of his staff.10
In the Court’s Resolutions dated December 17, 200811 and March 2, 2009,12 the case was
referred to the Integrated Bar of the Philippines (IBP) for investigation, report, and
recommendation. After both parties failed to appear during the mandatory conference, IBP
Investigating Commissioner Atty. Salvador B. Hababag (Investigating Commissioner) required
the parties to submit their respective position papers.13 Complainant filed her position paper14 on
October 8, 2009, while respondent failed to do so.
The IBP’s Report and Recommendation
On November 6, 2009, the Investigating Commissioner issued his Report and
Recommendation,15 finding respondent to have violated Rules 16.01 and 16.03, Canon 16 of the
Code of Professional Responsibility (Code) for his failure to properly account for the money
entrusted to him without any adequate explanation why he could not return the same. The
Investigating Commissioner found that respondent’s acts demonstrated his "lack of candor,
fairness, and loyalty to his client, who entrusted him with money and documents for the
registration of the subject land."16 The Investigating Commissioner likewise held that
respondent’s failure to return the subject amount, despite being given "adequate time to
return"17 the same, "not to mention the repeated x x x demands made upon him," 18constitutes
"gross dishonesty, grave misconduct, and even misappropriation of money" 19 in violation of the
above-stated rules. In view of the foregoing, the Investigating Commissioner recommended that
respondent be suspended from the practice of law for a period of six (6) months, with a stern
warning that a repetition of the same or similar offenses in the future shall be dealt with more
severely.20
In a Resolution21 dated December 29, 2012, the IBP Board of Governors adopted and approved
the Investigating Commissioner’s Report and Recommendation with modification, ordering the
return of the amount of ₱31,500.00,22with legal interest and within thirty (30) days from receipt of
notice, to complainant.
The Issue Before the Court
The essential issue in this case is whether or not respondent should be held administratively
liable for violating Rules 16.01 and 16.03, Canon 16 of the Code.
The Court’s Ruling
The Court concurs with and affirms the findings of the IBP anent respondent’s administrative
liability but deems it proper to: (a) extend the recommended period of suspension from the
practice of law from six (6) months to one (1) year; and (b) delete the recommended order for
the return of the amount of ₱31,500.00.
Anent respondent’s administrative liability, the Court agrees with the IBP that respondent’s
failure to properly account for and duly return his client’s money despite due demand is
tantamount to a violation of Rules 16.01 and 16.03, Canon 16 of the Code which respectively
read 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.
Rule 16.03 – A lawyer shall deliver the funds and property of his client when due or upon
demand.1âwphi1 However, he shall have a lien over the funds and may apply so much thereof
as may be necessary to satisfy his lawful fees and disbursements, giving notice promptly
thereafter to his client. He shall also have a lien to the same extent on all judgments and
executions he has secured for his client as provided for in the Rules of Court.
Records disclose that respondent admitted the receipt of the subject amount from complainant
to cover for pertinent registration expenses but posited his failure to return the same due to his
client’s act of confronting him at his office wherein she shouted and called him names. With the
fact of receipt being established, it was then respondent’s obligation to return the money
entrusted to him by complainant. To this end, suffice it to state that complainant’s purported act
of "maligning" respondent does not justify the latter’s failure to properly account for and return
his client’s money upon due demand. Verily, a lawyer’s duty to his client is one essentially
imbued with trust so much so that it is incumbent upon the former to exhaust all reasonable
efforts towards its faithful compliance. In this case, despite that singular encounter, respondent
had thereafter all the opportunity to return the subject amount but still failed to do so. Besides,
the obligatory force of said duty should not be diluted by the temperament or occasional
frustrations of the lawyer’s client, especially so when the latter remains unsatisfied by the
lawyer’s work. Indeed, a lawyer must deal with his client with professional maturity and commit
himself towards the objective fulfillment of his responsibilities. If the relationship is strained, the
correct course of action is for the lawyer to properly account for his affairs as well as to ensure
the smooth turn-over of the case to another lawyer. Except only for the retaining lien
exception23 under Rule 16.03, Canon 16 of the Code, the lawyer should not withhold the
property of his client. Unfortunately, absent the applicability of such exception or any other
justifiable reason therefor, respondent still failed to perform his duties under Rules 16.01 and
16.03, Canon 16 of the Code which perforce warrants his administrative liability.
The Court, however, deems it proper to increase the IBP’s recommended period of suspension
from the practice of law from six (6) months to one (1) year in view of his concomitant failure to
exercise due diligence in handling his client’s cause as mandated by Rules 18.03 and 18.04,
Canon 18 of the Code:
CANON 18 - A LAWYER SHALL SERVE HIS CLIENT WITH COMPETENCE AND DILIGENCE.
Rule 18.03 - A lawyer shall not neglect a legal matter entrusted to him, and his negligence in
connection therewith shall render him liable.
Rule 18.04 - A lawyer shall keep the client informed of the status of his case and shall respond
within a reasonable time to the client's request for information.
After a judicious scrutiny of the records, the Court observes that respondent did not only
accomplish his undertaking under the retainer, but likewise failed to give an adequate
explanation for such non-performance despite the protracted length of time given for him to do
so. As such omissions equally showcase respondent’s non-compliance with the standard of
proficiency required of a lawyer as embodied in the above-cited rules, the Court deems it apt to
extend the period of his suspension from the practice of law from six (6) months to one (1) year
similar to the penalty imposed in the case of Del Mundo v. Capistrano.24
As a final point, the Court must clarify that the foregoing resolution should not include a directive
for the return of the amount of ₱31,500.00 as recommended by the IBP Board of Governors.
The same amount was given by complainant to respondent to cover for registration expenses;
hence, its return partakes the nature of a purely civil liability which should not be dealt with
during an administrative-disciplinary proceeding. In Tria-Samonte v. Obias,25the Court recently
held that its "findings during administrative-disciplinary proceedings have no bearing on the
liabilities of the parties involved which are purely civil in nature – meaning, those liabilities which
have no intrinsic link to the lawyer's professional engagement – as the same should be threshed
out in a proper proceeding of such nature." This pronouncement the Court applies to this case
and thus, renders a disposition solely on respondent’s administrative liability.
WHEREFORE, respondent Atty. Bartolome C. Lawsin is found guilty of violating Rules 16.01
and 16.03, Canon 16, and Rules 18.03 and 18.04, Canon 18 of the Code of Professional
Responsibility. Accordingly, he is hereby SUSPENDED from the practice of law for a period of
one (1) year effective upon his receipt of this Resolution with a stem warning that a repetition of
the same or similar acts will be dealt with more severely.
Let a copy of this Resolution be furnished the Office of the Bar Confidant the Integrated Bar of
the Philippines and the Office of the Court Administrator for circulation to all the courts.
SO ORDERED.
CANON 17
A.C. No. 3745 October 2, 1995
CYNTHIA B. ROSACIA, complainant,
vs.
ATTY. BENJAMIN B. BULALACAO, respondent.
RESOLUTION
FRANCISCO, J.:
Complainant Cynthia B. Rosacia, president of Tacma, Phils., Inc., a duly registered corporation,
filed a complaint for disbarment dated October 25, 1991, against herein respondent Atty.
Benjamin B. Bulalacao. Acting on the complaint, the Court in a resolution dated February 24,
1992, resolved to refer the case to the Integrated Bar of the Philippines (IBP) for investigation,
report and recommendation. Commissioner Victor C. Fernandez, the IBP investigating
commissioner, found that respondent breached his oath of office and accordingly recommended
respondent's suspension from the practice of law for three (3) months.1 In a resolution dated July
30, 1994, the IBP Board of Governors resolved to adopt and approve the commissioner's report
and recommendation.2
As found by the IBP, the undisputed facts are as follows:
On June 1, 1990, by virtue of a written Agreement (Exh. "3-a"), respondent
Atty. Benjamin B. Bulalacao was hired as retained counsel of a corporation
by the name of Tacma Phils., Inc.
On October 31, 1990, the lawyer-client relationship between the respondent
and Tacma Phils., Inc. was severed as shown by another agreement of
even date (Exh. "3-b").
On July, 1991, or after almost nine (9) months from the date respondent's
retainer agreement with Tacma, Phils., Inc. was terminated, several
employees of the corporation consulted the respondent for the purpose of
filing an action for illegal dismissal. Thereafter, he agreed to handle the case
for the said employees as against Tacma, Phils., Inc. by filing a complaint
before the National Labor Relations Commission, and appearing in their
behalf.3
The sole issue to be addressed is whether or not respondent breached his oath of office for
representing the employees of his former client, Tacma, Phils., Inc., after the termination of their
attorney-client relationship. We agree with the findings of the IBP that respondent breached his
oath of office. Respondent does not now dispute this. In fact, in his motion for reconsideration,
respondent admitted that he "did commit an act bordering on grave misconduct, if not outright
violation of his attorney's oath".4 However, respondent is pleading for the Court's compassion
and leniency to reduce the IBP recommended three months suspension to either fine or
admonition with the following proffered grounds: that he is relatively new in the profession having
been admitted to the Philippine Bar on April 10, 1990 at the age of 46 when the complained
conduct was committed on August 1991; that he is of humble beginnings and his suspension will
deprive his family of its only source of livelihood he being the sole bread winner in the family;
that he has fully realized his mistake and the gravity of his offense for which he is fully repentant;
that he has severed his attorney-client relationship with the employees of Tacma, Phils., Inc. by
inhibiting himself and withdrawing his appearance as counsel in the labor case against Tacma,
Phils., Inc.; and that he pledges not to commit the same mistake and to henceforth strictly
adhere to the professional standards set forth by the Code of Professional Responsibility.
The Court reiterates that an attorney owes loyalty to his client not only in the case in which he
has represented him but also after the relation of attorney and client has terminated as it is not
good practice to permit him afterwards to defend in another case other person against his former
client under the pretext that the case is distinct from, and independent of the former case. 5 It
behooves respondent 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 attorneys which is of paramount importance in the administration of
justice.6 The relation of attorney and client is one of confidence and trust in the highest
degree.7 A lawyer owes fidelity to the cause of his client and he ought to be mindful of the trust
and confidence reposed in him.8 An attorney not only becomes familiar with all the facts
connected with his client's cause, but also learns from his client the weak and strong points of
the case. No opportunity must be given attorneys to take advantage of the secrets of clients
obtained while the confidential relation of attorney and client exists. Otherwise, the legal
profession will suffer by the loss of the confidence of the people.9
Respondent's plea for leniency cannot be granted. We note that respondent is new in the
profession as he was just admitted to the Philippine Bar on April 10, 1990, when the breach of
his oath of office occurred more than a year after. Having just hurdled the bar examinations
which included an examination in legal ethics, surely the precepts of the Code of Professional
Responsibility to keep inviolate the client's trust and confidence even after the attorney-client
relation is terminated 10 must have been still fresh in his mind. A lawyer starting to establish his
stature in the legal profession must start right and dutifully abide by the norms of conduct of the
profession. This will ineluctably redound to his benefit and to the upliftment of the legal
profession as well.
ACCORDINGLY, respondent is hereby SUSPENDED from the practice of law for three months.
Let this resolution be attached to respondent's record in the Office of the Bar Confidant and
copies thereof furnished to all courts and to the Integrated Bar of the Philippines.
A.C. No. 4945 October 8, 2013
MA. JENNIFER TRIA-SAMONTE, Complainant,
vs.
EPIFANIA "FANNY" OBIAS, Respondent.
RESOLUTION
PER CURIAM:
For the Court's resolution is an administrative Complaint-affidavit1 filed by Ma. Jennifer Tria-
Samonte (complainant) against Epifania "Fanny"Obias (respondent) charging her for grave
misconduct and/or gross malpractice.
The facts
In 1997, spouses Prudencio and Loreta Jeremias (Sps. Jeremias),through respondent, offered
for sale a parcel of agricultural land covered by Transfer Certificate of Title No. 597 (subject
property) to the late Nestor Tria (Nestor) and Pura S. Tria (Sps. Tria), for a consideration of
₱2,800,000.00 and payable in installments.2 Respondent, who was to receive the payment from
Sps. Tria and transmit the same to Sps. Jeremias, undertook to deliver the deed of sale and
owner’s copy of the title to her clients (Sps. Tria) upon full payment of the purchase price. 3 She
further undertook to cause the conversion of the subject property from agricultural to residential,
and the transfer of the title to the names of Sps. Tria as part of the package
agreement.4 Respondent received all the installment payments made by Sps. Tria and issued
receipts therefor.5 After full payment of the purchase price on July 11, 1997,6 and after giving an
additional ₱115,000.00for capital gains tax and other expenses,7 Sps. Tria requested from
respondent the delivery of the deed of sale and the owner’s copy of the title to them but
respondent failed to comply explaining that the Department of Agrarian Reform clearance for
conversion of the subject property from agricultural to residential was taking time. 8 Despite
several subsequent demands, respondent still failed to fulfill her undertakings under the package
agreement.9
On May 22, 1998, Nestor was fatally shot and died.10 Thereafter, complainant, daughter of Sps.
Tria, again demanded from respondent and Sps. Jeremias the delivery of the deed of sale and
the certificate of title of the subject property to them, but to no avail. For their part, Sps. Jeremias
informed complainant that they had received the consideration of ₱2,200,000.00 and they had
executed and turned-over the sale documents to respondent.11
Complainant later discovered that a deed of sale over the subject property was executed by Sps.
Jeremias and notarized by respondent favor of someone else, a certain Dennis Tan, on May 26,
1998 for a consideration of ₱200,000.00.12
In defense, respondent, in her Comment,13 claimed that Nestor instructed her in November 1997
not to proceed with the processing of the deed of sale and, instead, to just look for another
buyer.14 She further averred that Nestor also demanded from her the return of the purchase
price, and that she complied with the said demand and returned the ₱2,800,000.00 in cash to
Nestor sometime during the latter part of January 1998.15 However, she did not ask for a written
receipt therefor. In fact, Nestor told her not to return the ₱115,000.00 intended for capital gains
taxes and other expenses, and to just apply the said sum as attorney’s fees for the other legal
services that she rendered for him.16
In the Court’s Resolution17 dated August 30, 1999, the case was referred to the Integrated Bar of
the Philippines (IBP) for investigation, report, and recommendation. After numerous
postponements, mostly at the instance of respondent,18 only the complainant and her witnesses
testified before the IBP. Eventually, respondent’s right to present evidence was considered
waived.19
The IBP’s Report and Recommendation
On September 25, 2007, the IBP Investigating Commissioner, Wilfredo E.J.E. Reyes
(Investigating Commissioner), issued his Report and Recommendation, 20 finding respondent to
have violated her oath as a lawyer due to her participation in the second sale of the subject
property despite the lack of any lawful termination of the prior sale of the same property to
Sps.Tria. The Investigating Commissioner observed that respondent received, and admitted to
have received, from Sps. Tria the ₱2,800,000.00 purchase price and the amount of ₱115,000.00
for expenses. He further found the second sale of the same property to Dennis Tan as a clear
indication that respondent: (a) employed serious deceit or fraud against Sps. Tria and their
family; (b) violated their proprietary rights; and (c) violated the trust and confidence reposed in
her.21 On the other hand, the Investigating Commissioner did not give credence to respondent’s
defense that she returned the ₱2,800,000.00 purchase price given by Sps. Tria and that the
latter caused the cancellation of the sale of the subject property in their favor, absent any receipt
or documentation to prove the same.22 As counsel for Sps. Tria, respondent failed in her
obligation to observe honesty and diligence in their transaction and, as such, she was found
guilty of grave misconduct and gross malpractice in violation of Canons 17 and 18 of the Code of
Professional Responsibility (Code).23 Accordingly, the Investigating Commissioner
recommended that respondent be suspended from the practice of law for a period of five years. 24
Finding the recommendation to be fully supported by the evidence on record and the applicable
laws and rules, and considering respondent’s violation of Canons 17 and 18 of the Code, the
IBP Board of Governors adopted and approved the Investigating Commissioner’s Report and
Recommendation in Resolution No. XVIII-2007-18525 dated October 19,2007 but reduced the
suspension of respondent from the practice of law from five years to one year.
Both complainant and respondent filed their respective motions for reconsideration26 which were,
however, denied in the IBP Board of Governors’ Resolution No. XX-2012-109 dated March 10,
2012.27
The Issue Before the Court
The essential issue in this case is whether or not respondent should beheld administratively
liable for violating Canons 17 and 18 of the Code.
The Court’s Ruling
The Court finds no cogent reason to disturb the findings of the IBP. Indeed, respondent, in her
Comment, already admitted that she rendered legal services to Sps. Tria,28 which necessarily
gave rise to a lawyer-client relationship between them. The complete turnaround made by
respondent in her motion for reconsideration from the IBP Board of Governors’ Resolution No.
XX-2012-109, where she contended that there was no lawyer-client relationship between her
and Sps. Tria,29 cannot thus be given any credence.
Since respondent publicly held herself out as lawyer, the mere fact that she also donned the hat
of a real estate broker did not divest her of the responsibilities attendant to the legal profession.
In this regard, the legal advice and/or legal documentation that she offered and/or rendered
regarding the real estate transaction subject of this case should not be deemed removed from
the category of legal services.30 Case law instructs that if a person, in respect to business affairs
or troubles of any kind, consults a lawyer with a view to obtaining professional advice or
assistance, and the attorney voluntarily permits or acquiesces with the consultation, then the
professional employment is established.31 Thus, in view of the fact that Sps. Tria knew
respondent to be, and transacted with her as, a lawyer, her belated and unilateral classification
of her own acts as being limited to those of a real estate broker cannot be upheld. In any case,
the lawyer-client relationship between Sps. Tria and respondent was confirmed by the latter’s
admission that she rendered legal services to the former. With this relationship having been
established, the Court proceeds to apply the ethical principles pertinent to this case.
It is a core ethical principle that lawyers owe fidelity to their clients’ cause and must always be
mindful of the trust and confidence reposed in them.32 They are duty-bound to observe candor,
fairness, and loyalty in all their dealings and transactions with their clients. 33 Irrefragably, the
legal profession demands of attorneys an absolute abdication of every personal advantage
conflicting in any way, directly or indirectly, with the interests of their clients. 34 As enshrined in
Canons 17 and 18 of the Code:
Canon 17 - A lawyer owes fidelity to the cause of his client and he shall be mindful of the trust
and confidence reposed in him.
Canon 18 - A lawyer shall serve his client with competence and diligence.1âwphi1
In the present case, respondent clearly transgressed the above-mentioned rules as her actions
were evidently prejudicial to her clients’ interests. Records disclose that instead of delivering the
deed of sale covering the subject property to her clients, she willfully notarized a deed of sale
over the same property in favor of another person. Accordingly, far removed from protecting the
interest of her clients, Sps. Tria, who had, in fact, already fully paid the purchase price of the
subject property, respondent participated and was even instrumental in bringing about the defeat
of their rights over the said property. Hence, respondent grossly violated the trust and
confidence reposed in her by her clients, in contravention of Canons 17and 18 of the Code. To
add, by turning against her own clients, respondent also violated Rule 1.01, Canon 1 of the
Code which provides that a lawyer shall not engage in unlawful, dishonest and immoral or
deceitful conduct. Lest it be forgotten, lawyers are bound to maintain not only a high standard of
legal proficiency, but also of morality, honesty, integrity, and fair dealing.35 These unyielding
standards respondent evidently failed to adhere to.
Anent the proper penalty to be imposed, records bear out that the penalty of suspension from
the practice of law recommended by the Investigating Commissioner was decreased from a
period of five years to just one year by the IBP Board of Governors in Resolution No. XVIII-2007-
185. However, the Court observes that the said resolution is bereft of any explanation showing
the bases for such modification in contravention of Section 12(a), Rule 139-B of the Rules of
Court which mandates that "the decision of the Board upon such review shall be in writing and
shall clearly and distinctly state the facts and the reasons on which it is based." Verily, the Court
frowns on the unexplained change made by the IBP Board of Governors in the recommended
penalty. Be that as it may, the Court proceeds to correct the same.
Jurisprudence reveals that in similar cases where lawyers abused the trust and confidence
reposed in them by their clients as well as committed unlawful, dishonest, and immoral or
deceitful conduct, as in this case, the Court found them guilty of gross misconduct and disbarred
them. In Chuav. Mesina, Jr.,36 the Court disbarred the lawyer who, upon his misrepresentations,
breached his promise to his clients to transfer to them the property subject of that case, but
instead, offered the same for sale to the public. Also, in Tabang v. Gacott, 37 the penalty of
disbarment was meted out against the lawyer who, among others, actively sought to sell the
properties subject of that case contrary to the interests of his own clients. As the infractions in
the foregoing cases are akin to those committed by respondent in the case at bar, the Court
deems that the same penalty of disbarment be imposed against her. Clearly, as herein
discussed, respondent committed deliberate violations of the Code as she dishonestly dealt with
her own clients and advanced the interests of another against them resulting to their loss. For
such violations, respondent deserves the ultimate punishment of disbarment consistent with
existing jurisprudence.
As a final point, it bears to note that the foregoing resolution does not-as it should not -include an
order for the return of the ₱2,800,000.00 purchase price and the amount of ₱115,000.00 for
expenses allegedly received by respondent, albeit the Investigating Commissioner's findings on
the same. In Roa v. Moreno,38 it has been held that disciplinary proceedings against lawyers are
only confined to the issue of whether or not the respondent-lawyer is still fit to be allowed to
continue as a member of the Bar and that the only concern is his administrative liability. 39Thus,
the Court's findings during administrative-disciplinary proceedings have no bearing on the
liabilities of the parties involved which are purely civil in nature -meaning, those liabilities which
have no intrinsic link to the lawyer's professional engagement40 – as the same should be
threshed out in a proper proceeding of such nature.
WHEREFORE, respondent Epifania "Fanny" Obias is found guilty of gross misconduct and is
accordingly DISBARRED.
Let a copy of this Resolution be furnished the Office of the Bar Confidant, the Integrated Bar of
the Philippines, and the Office of the Court Administrator for circulation to all the courts.
SO ORDERED.
 CANON 18
A.C. No. 5359 March 10, 2014
ERMELINDA LAD VOA. DE DOMINGUEZ, represented by her Attorney-in-Fact, VICENTE A.
PICHON,Complainant,
vs.
ATTY. ARNULFO M. AGLERON, SR., Respondent.
RESOLUTION
MENDOZA, J.:
Complainant Ermelinda Lad Vda. De Dominguez (complainant) was the widow of the late Felipe
Domiguez who died in a vehicular accident in Caraga, Davao Oriental, on October 18, 1995,
involving a dump truck owned by the Municipality of Caraga. Aggrieved, complainant decided to
file charges against the Municipality of Caraga and engaged the services of respondent Atty.
Arnulfo M. Agleron, Sr. (Atty. Agleron). On three (3) occasions, Atty. Agleron requested and
received from complainant the following amounts for the payment of filing fees and sheriffs fees,
to wit: (1) June 3, 1996 -₱3,000.00; (2) June 7, 1996 -Pl,800.00; and September 2, 1996 -
₱5,250.00 or a total of ₱10,050.00. After the lapse of four (4) years, however, no complaint was
filed by Atty. Agleron against the Municipality of Caraga.1
Atty. Agleron admitted that complainant engaged his professional service and received the
amount of ₱10,050.00. He, however, explained that their agreement was that complainant would
pay the filing fees and other incidental expenses and as soon as the complaint was prepared
and ready for filing, complainant would pay 30% of the agreed attorney’s fees of ₱100,000.00.
On June 7, 1996, after the signing of the complaint, he advised complainant to pay in full the
amount of the filing fee and sheriff’s fees and the 30% of the attorney’s fee, but complainant
failed to do so. Atty. Agleron averred that since the complaint could not be filed in court, the
amount of ₱10,050.00 was deposited in a bank while awaiting the payment of the balance of the
filing fee and attorney’s fee.2
In reply,3 complainant denied that she did not give the full payment of the filing fee and asserted
that the filing fee at that time amounted only to ₱7,836.60.
In the Report and Recommendation,4 dated January 12, 2012, the Investigating Commissioner
found Atty. Agleron to have violated the Code of Professional Responsibility when he neglected
a legal matter entrusted to him, and recommended that he be suspended from the practice of
law for a period of four (4) months.
In its April 16, 2013 Resolution,5 the Integrated Bar of the Philippines (IBP) Board of Governors
adopted and approved the report and recommendation of the Investigating Commissioner with
modification that Atty. Agleron be suspended from the practice of law for a period of only one (1)
month.
The Court agrees with the recommendation of the IBP Board of Governors except as to the
penalty imposed.
Atty. Agleron violated Rule 18.03 of the Code of Professional Responsibility, which provides that:
Rule 18.03-A lawyer shall not neglect a legal matter entrusted to him, and his negligence in
connection therewith shall render him liable.
Once a lawyer takes up the cause of his client, he is duty bound to serve his client with
competence, and to attend to his client’s cause with diligence, care and devotion regardless of
whether he accepts it for a fee or for free.6 He owes fidelity to such cause and must always be
mindful of the trust and confidence reposed on him.7
In the present case, Atty. Agleron admitted his failure to file the complaint against the
Municipality of Caraga, Davao Oriental, despite the fact that it was already prepared and signed.
He attributed his non-filing of the appropriate charges on the failure of complainant to remit the
full payment of the filing fee and pay the 30% of the attorney's fee. Such justification, however, is
not a valid excuse that would exonerate him from liability. As stated, every case that is entrusted
to a lawyer deserves his full attention whether he accepts this for a fee or free. Even assuming
that complainant had not remitted the full payment of the filing fee, he should have found a way
to speak to his client and inform him about the insufficiency of the filing fee so he could file the
complaint. Atty. Agleron obviously lacked professionalism in dealing with complainant and
showed incompetence when he failed to file the appropriate charges.1âwphi1
In a number of cases,8 the Court held that a lawyer should never neglect a legal matter entrusted
to him, otherwise his negligence renders him liable for disciplinary action such as suspension
ranging from three months to two years. In this case, the Court finds the suspension of Atty.
Agleron from the practice of law for a period of three (3) months sufficient.
WHEREFORE, the resolution of the IBP Board of Governors is hereby AFFIRMED with
MODIFICATION. Accordingly, respondent ATTY. ARNULFO M. AGLERON, SR. is hereby
SUSPENDED from the practice of law for a period of THREE (3) MONTHS, with a stern warning
that a repetition of the same or similar wrongdoing will be dealt with more severely.
Let a copy of this resolution be furnished the Bar Confidant to be included in the records of the
respondent; the Integrated Bar of the Philippines for distribution to all its chapters; and the Office
of the Court Administrator for dissemination to all courts throughout the country.
SO ORDERED.
G.R. No. L-23956 July 21, 1967
ELPIDIO JAVELLANA, plaintiff-appellant,
vs.
NICOLAS LUTERO, Judge of the Municipal Court of Iloilo City and the ROMAN CATHOLIC
ARCHBISHOP OF JARO, defendants-appellees.
Hautea and Hinojales for plaintiff-appellant.
Luisito C. Hofileña for defendants-appellees.
CASTRO, J.:
This is an appeal from a decision of the Court of First Instance of Iloilo (CC 6425) dismissing a
petition for relief directed against the judgment rendered by the municipal court of Iloilo City in its
civil case 7220.
On March 29, 1963 the Roman Catholic Archbishop of Jaro, Iloilo filed a detainer complaint
against Elpidio Javellana with the municipal court of Iloilo City, presided by Judge Nicolas
Lutero. The hearing, originally set for April 30, 1963, was postponed to May 24 for failure of the
defendant to receive summons, and then postponed again to June 27 for the same reason. It
was thereafter postponed to July 16, then to July 24, and finally to August 27, all at the behest of
the defendant's Atty. Jose Hautea, on the grounds that "he has not finished his business
transactions in Manila" and that "he hurt his right foot toe." The last postponement was granted
by the municipal court with the warning that no further postponement would be entertained.
When the case was called for trial on August 27, 1963, neither the defendant nor his counsel
Atty. Hautea appeared although one Atty. Romy Peña who was present in court verbally moved
for the postponement of the trial on the ground that Atty. Hautea was in Manila attending to a
business transaction. The plaintiff's counsel objected to the motion on the ground that the
defendant and his counsel were well aware of the court's previous admonition that no further
postponement of the case would be granted, and then manifested that the witnesses and the
evidence for the plaintiff were ready for presentation on that date. The verbal motion for
postponement was denied and the plaintiff was directed to adduce his evidence. During the
presentation of the plaintiff's evidence, the municipal court received a telegram from Atty. Hautea
requesting postponement of the hearing. The trial proceeded nevertheless, and, on the basis of
the plaintiff's evidence, the court on the same date rendered judgment for the plaintiff and
against the defendant. The latter's counsel received a copy of the decision on September 9,
1963. On the following September 11, he filed a motion to set aside judgment and for new trial.
This motion was denied on September 26; a copy of the order of denial was received by him on
the same date.
On November 16, 1963, or about 50 days later, the defendant thru his same counsel filed a
petition for relief (from the judgment of the municipal court)with the Court of First Instance of
Iloilo, praying that the decision in question be set aside, that the detainer case be set for trial on
the merits, and, pending determination of the petition, that an injunction issue restraining the
enforcement of the decision. Counsel for the petitioner averred that his absence on the date of
the trial was excusable as he attended to a very urgent business transaction in Manila; that
before his departure for the latter city, he verbally informed the respondent judge that his return
to Iloilo might be delayed and that he might not arrive on time for the trial of the case as set; that
he called at both the law office and the residence of the counsel for the private respondent to
inform him of the desired postponement and the reason therefor, but the latter was in Bacolod at
the time; that he exercised utmost diligence and precaution in the sense that while in Manila he
sent a telegram to the respondent judge, asking for postponement; and that notwithstanding all
the foregoing, the municipal court nevertheless proceeded with the trial in his absence and that
of his client, allowed the private respondent to present his evidence ex parte, and rendered a
decision against the petitioner, thus depriving the latter of his day in court. Counsel for the
petitioner further asserted that his client has a good and substantial defense, which is, that the
complainant had given his client an option to buy the premises subject-matter of the complaint
below, and that a reopening of the case would cause the private respondent no real injury.
This petition was given due course, the respondents were required to file their answers, and a
cease-and-desist order was issued as prayed for. On February 22, 1964, after due hearing, the
Court of First Instance rendered judgment dismissing the petition.1äwphï1.ñët
Hence the present recourse.
From the perspective of the environmental circumstances obtaining in this case, the present
appeal is palpably devoid of merit.
A counsel for any party in a judicial controversy, by mandate of the canons of legal ethics, and
with due regard for the elementary standards of fair play, is duty bound to prepare for trial with
diligence and deliberate speed. This norm of conduct is no less applicable in a detainer case,
such as the one at bar, even if the issues are essentially simple and uncomplicated. It is obvious
that the counsel for the petitioner-appellant has been remiss in this respect.
The case was set for trial six times. Thrice it was postponed at the behest of the said counsel.
The last postponement was granted on July 24, 1963 with the unequivocal admonition by the
judgment that no further postponement would be countenanced. The case was reset for hearing
on August 27, 1963, which means that the appellant's counsel had more than a month's time to
so adjust his schedule of activities as to obviate a conflict between his business transactions and
his calendar of hearings. Came August 27, and neither he nor the appellant appeared at the trial.
His absence on the latter date was not occasioned by illness or some other supervening
occurrence which unavoidably and justifiably prevented him from appearing in court.
In our view, it was the bounden duty of the said counsel, under the circumstances, to give
preferential attention to the case. As things were, he regarded the municipal court as a mere
marionette that must ever await his pleasure. This attitude on his part is censurable as it reveals
more than just a modicum of disrespect for the judiciary and the established machinery of
justice.
Nor is his censurable conduct mitigated by the appearance in court on August 27 of another
attorney who verbally moved for postponement nor by his telegram received by the municipal
judge on the same date asking for continuance. These circumstances, upon the contrary,
emphasize his presumptuousness vis-a-vis the municipal judge.
It is thus crystal-clear from the foregoing disquisition that the petitioner-appellant was not
deprived of his day in court, and that the respondent municipal judge did not err in proceeding
with the trial, allowing the private respondent to present his evidence ex parte, and thereafter
rendering decision for the plaintiff-appellee. It follows that the petitioner was not entitled to the
remedy of a petition for relief.
Moreover, after the denial of his motion to set aside judgment and for new trial, the appellant had
ample time to appeal; instead he allowed the judgment to become final and executory. His
argument that an appeal would have been futile as there was no evidence upon which such
appeal could be based, merits scant consideration. An appeal from the decision of a municipal
court to the Court of First Instance has the effect of vacating the decision (sec. 9, Rule 40, view
Rules of Court; sec. 9, Rule 40, of the old Rules), and the action is to be tried de novo without
regard to the proof presented in the municipal court or the conclusions reached thereon (Colegio
de San Jose vs. Sison, 56 Phil. 344, 351; Lizo vs. Carandang, 73 Phil. 649; Crisostomo vs.
Director of Prisons, 41 Phil. 368). To grant the appellant's petition for relief would amount to
reviving his right to appeal which he had irretrievably lost through the gross inaction of his
counsel (see Espinosa vs. Yatco, etc., et al., L-16435, Jan. 31, 1963, and the cases therein
cited). This in law cannot be done.
Accordingly, the decision appealed from is affirmed. As this appeal is patently frivolous and
dilatory, this Court, under the authority of section 3 of Rule 142 of the Rules of Court, hereby
assesses treble costs against the petitioner-appellant Elpidio Javellana, said costs to be paid by
his counsel, Atty. Jose Hautea.
[A.C. No. 3455. April 14, 1998]
ARSENIO A. VILLAFUERTE, complainant, vs. ATTY. DANTE H. CORTEZ, respondent.
RESOLUTION
VITUG, J.:
Feeling aggrieved by what he perceives to be a neglect in the handling of his cases by
respondent lawyer, despite the latter's receipt of P1,750.00 acceptance and retainer fees,
complainant Arsenio A. Villafuerte seeks, in the instant proceedings, the disbarment of Atty.
Dante H. Cortez.
From the records of the case and the Report submitted by the Commission on Bar
Discipline ("CBD") of the Integrated Bar of the Philippines ("IBP"), it would appear that sometime
in January 1987, complainant, upon the referral of Atty. Rene A. V. Saguisag, went to the office
of respondent lawyer to discuss his case for "reconveyance" (Civil Case No. 83-18877). During
their initial meeting, complainant tried to reconstruct before respondent lawyer the incidents of
the case merely from memory prompting the latter to ask complainant to instead return at
another time with the records of the case. On 30 January 1987, complainant again saw
respondent but still sans the records. Complainant requested respondent to accept the case,
paying to the latter the sum of P1,750.00 representing the acceptance fee of P1,500.00
and P250.00 retainer fee for January 1987. Respondent averred that he accepted the money
with much reluctance and only upon the condition that complainant would get the records of the
case from, as well as secure the withdrawal of appearance of, Atty. Jose Dizon, the former
counsel of complainant. Allegedly, complainant never showed up thereafter until November 1989
when he went to the office of respondent lawyer but only to leave a copy of a writ of execution in
Civil Case No. 062160-CV, a case for ejectment, which, according to respondent, was never
priorly mentioned to him by complainant. Indeed, said respondent, he had never entered his
appearance in the aforenumbered case.
In its report, IBP-CBD concluded that the facts established would just the same indicate
sufficiently a case of neglect of duty on the part of respondent. The CBD rejected the excuse
proffered by respondent that the non-receipt of the records of the case justified his failure to
represent complainant. The IBP-CBD, through Commissioner Julio C. Elamparo, recommended
to the IBP Board of Governors the suspension of respondent from the practice of law for three
months with a warning that a repetition of similar acts could be dealt with more severely than a
mere 3-month suspension.
On 30 August 1996, the IBP Board of Governors passed Resolution No. XII-96-191 which
- [G.R. No. 127064. August 31, 1999]
"RESOLVED to ADOPT and APPROVE, as it is hereby ADOPTED and APPROVED, the Report
and Recommendation of the Investigating Commissioner in the above-entitled case, hereinmade
part of this Resolution/Decision as Annex `A;' and, finding the recommendation therein to be fully
supported by the evidence on record and the applicable laws and rules, Respondent Atty. Dante
Cortez is hereby SUSPENDED from the practice of law for three (3) months with a warning that
a repetition of the acts/omission complained of will be dealt with more severely." [1]
Both respondent lawyer and complainant filed with the IBP-CBD their respective motions
for the reconsideration of the foregoing resolution.
On 23 August 1997, the Board of Governors passed Resolution No. XII-97-66 that -
"RESOLVED to CONFIRM Resolution NO. XII-96-191 of the Board of Governors Meeting
dated August 30, 1996 SUSPENDING Atty. Dante Cortez from the practice of law for
three (3) months with a warning that repetition of the acts/omission complained of will be
dealt with more severely."[2]
The Court agrees with the IBP-CBD in its findings and conclusion that respondent lawyer
has somehow been remiss in his responsibilities.
The Court is convinced that a lawyer-client relationship, given the circumstances, has
arisen between respondent and complainant. Respondent lawyer has admitted having received
the amount of P1,750.00, including its nature and purpose, from complainant. His acceptance of
the payment effectively bars him from altogether disclaiming the existence of an attorney-client
relationship between them. It would not matter really whether the money has been intended to
pertain only to Civil Case No. 83-18877 or to include Civil Case No. 062160-CV, there being no
showing, in any event, that respondent lawyer has attended to either of said cases. It would
seem that he hardly has exerted any effort to find out what might have happened to his client's
cases. A lawyer's fidelity to the cause of his client requires him to be ever mindful of the
responsibilities that should be expected of him.[3] He is mandated to exert his best efforts to
protect, within the bounds of the law, the interests of his client. The Code of Professional
Responsibility cannot be any clearer in its dictum than when it has stated that a "lawyer shall
serve his client with competence and diligence," [4] decreeing further that he "shall not neglect a
legal matter entrusted to him."[5]
Complainant, nevertheless, is not entirely without fault himself. He cannot expect his case
to be properly and intelligently handled without listening to his own counsel and extending full
cooperation to him. It is not right for complainant to wait for almost two years and to deal with his
lawyer only after receiving an adverse decision.
All considered, the Court deems it proper to reduce the recommended period of
suspension of the IBP from three months to one month.
WHEREFORE, Atty. Dante H. Cortez is hereby SUSPENDED from the practice of law for
a period of one month from notice hereof, with a warning that a repetition of similar acts and
other administrative lapses will be dealt with more severely than presently.
Let a copy of this Resolution be made a part of the personal records of respondent lawyer
in the Office of the Bar Confidant, Supreme Court of the Philippines, and let copies thereof be
furnished to the Integrated Bar of the Philippines and be circulated to all courts.
SO ORDERED.
FIVE STAR BUS COMPANY INC., and IGNACIO TORRES, petitioners, vs. COURT OF
APPEALS, JUDGE JAIME F. BAUTISTA, RTC-Br. 75, Valenzuela, Metro Manila
and SAMUEL KING SAGARAL II, respondents.
DECISION
BELLOSILLO, J.:
The threshold issue in this petition for review on certiorari is whether the Court of Appeals
can summarily dismiss a petition on the ground that the certification on non-forum shopping
required by Supreme Court Circular No. 28-91 was signed by counsel and not by petitioners
themselves.
On 9 November 1991, at around 11:00 oclock in the evening, along the MacArthur
Highway in Valenzuela, Metro Manila, the Suzuki Supercarry Mini-Van driven by private
respondent Samuel King Sagaral II collided with a passenger bus owned and operated by
petitioner Five Star Bus Company and driven by co-petitioner Ignacio Torres.[1]
On 1 April 1992 private respondent Sagaral filed a civil action for damages against
petitioners and the case was assigned to Branch 171 of the Valenzuela Regional Trial Court and
docketed as Civil Case No. 3812-V-92.
When amicable settlement failed, trial ensued with private respondent Sagaral (plaintiff in
the court a quo) initially presenting his evidence. Several years passed and on 26 December
1996 Sagaral finally rested his case.[2] On 12 March 1996 the trial court ordered petitioners
herein (defendants in the court a quo) to present their evidence on 25 April 1996 and 9 May
1996.[3]
The presentation of evidence by petitioners was snagged by several postponements. The
first was when Presiding Judge Adriano R. Osorio reset the 25 April 1996 hearing to 9 May 1996
as he had to go on forced vacation leave from 23 April 1996 to 25 April 1996. [4] But during the 9
May 1996 hearing, petitioner Ignacio Torres failed to appear prompting the lower court to cancel
the hearing. According to petitioners, Torres was then detained in jail due to a separate pending
criminal case filed against him by Sagaral before Br. 172 of the RTC of Valenzuela. Petitioners
further explained that Torres could not post bail earlier for his provisional liberty since no notice
was sent to him regarding the criminal complaint.[5]
On 4 June 1996 Judge Osorio ordered the civil case to be unloaded in view of his courts
designation as a permanent special court to exclusively try heinous crimes under RA 7659. [6] On
17 June 1996 the case was re-raffled to Br. 75 of the same RTC, this time under Judge Jaime F.
Bautista who immediately scheduled a hearing for the initial presentation of petitioners' evidence
on 8 August 1996.[7] Nonetheless on 9 July 1996 petitioners filed a motion to reset the hearing
scheduled on 8 August 1996 to 15 August 1996 citing as reason their counsels conflict of
schedule.[8]
It seemed however that even prior to the scheduled hearing of 8 August 1996, former
Presiding Judge Osorio had already set a hearing for 2 July 1996 and 16 July 1996. But instead
of conducting a hearing on said dates, Judge Bautista issued an order on 2 July 1996, thus -
It appearing from the records that this case had been previously set by Branch 171 today and
July 16, 1996 and considering the Urgent Motion to Reset filed by the defendants thru counsel,
the hearing set for today is hereby cancelled and is reset to July 16, 1996 as previously
scheduled and August 8, 1996 both at 8:30 a.m. x x x x[9]
When the case was called for hearing on 16 July 1996, counsel for petitioners was not
present. In fact he arrived twenty (20) minutes late. Thus, upon motion of respondent Sagaral,
the trial court issued the disputed Order-
There being no certainty as to what time defendants counsel would be in court, and upon
manifestation of plaintiffs counsel that lawyer should be aware of his time x x x as prayed for, the
defendants right to present their evidence is deemed waived and the case is now submitted for
decision x x x x (underscoring supplied).[10]
Petitioners forthwith filed a motion for reconsideration of the above-mentioned Order
arguing that the right to be heard was a basic tenet guaranteed by the Constitution which the
courts could not impinge upon in the absence of any justifying reason to do so. They also
blamed the heavy traffic for their lawyer's tardiness.
To simplify the proceedings due to the various motions filed by petitioners, Judge Bautista
cancelled the 8 August 1996 hearing and reset it to 20 August 1996. He also set for hearing
petitioner's motion for reconsideration on 20 August 1996.[11]
However, as if trying to test the patience of the trial court, petitioners once again filed on 5
August 1996 an Urgent Motion to Reset the 20 August 1996 hearing. Their counsel pleaded that
he could not make it on such date because he had previously committed himself to appear
before the Antipolo Regional Trial Court. He prayed that the hearing be moved to 2 September
1996.[12]
The hearing set for 20 August 1996 was cancelled[13] and the trial court on that day issued
instead its Order denying petitioners' motion for reconsideration of its Order dated 16 July 1996
which considered the case submitted for resolution. The lower court noted that the case had
been pending for more than four (4) years and it had always been at the "mercy" of petitioners
when it acted favorably on their motions. There would be no end to this litigation if the court
would give due course to this motion.[14]
Undeterred, petitioners sought recourse in the Court of Appeals through a petition
for certiorari. But in the assailed Resolution dated 23 September 1996 the appellate court
summarily dismissed their petition on the ground that the affidavit of non-forum shopping was
signed and executed by counsel for petitioners and not by petitioners themselves, or one of
them, as required by Circular No. 28-91 of the Supreme Court.[15]
Petitioners moved for reconsideration which the Court of Appeals rejected in its Resolution
of 31 October 1996.[16] Petitioners are now before us contending that the appellate court erred in
affirming the Order of the trial court dated 16 July 1996 and in dismissing their petition for non-
compliance with the requirement of Circular No. 28-91.They pray that the appellate court remand
the case to the court of origin for further proceedings.
Circular No. 28-91, which took effect on 1 April 1994, provides inter alia:
(1) (I)n every petition filed with the Supreme Court or the Court of Appeals, the petitioner, aside
from complying with the pertinent provisions of the Rules of Court and existing circulars, must
certify under oath all of the following facts or undertakings x x x x;
(2) Any violation of this revised Circular will entail the following sanctions: (a) it shall be a cause
for the summary dismissal of the multiple petitions or complaints; x x x x (underscoring supplied).
Circular No. 28-91 has its roots in the rule that a party-litigant shall not be allowed to
pursue simultaneous remedies in two (2) different fora, for such practice works havoc upon
orderly judicial procedure. Forum shopping has been characterized as an act of malpractice that
is prohibited and condemned as trifling with the courts and abusing their processes. It
constitutes improper conduct which tends to degrade the administration of justice. It has also
been aptly described as deplorable because it adds to the congestion of the already heavily
burdened dockets of the courts.[17]
Nonetheless, we are not unmindful of this Courts ruling in Gabionza v. Court of
Appeals,[18] Loyola v. Court of Appeals,[19] and Kavinta v. Castillo, Jr.[20] that substantial
compliance with Circular No. 28-91 is sufficient:
It is scarcely necessary to add that Circular No. 28-91 must be so interpreted and applied to
achieve the purposes projected by the Supreme Court when it promulgated that circular. Circular
No. 28-91 was designed to serve as an instrument to promote and facilitate the orderly
administration of justice and should not be interpreted with such absolute literalness as to
subvert its own ultimate and legitimate objective or the goal of all rules of procedure which is to
achieve substantial justice as expeditiously as possible.
The fact that the Circular requires that it be strictly complied with merely underscores its
mandatory nature in that it cannot be dispensed with or its requirements altogether disregarded,
but it does not thereby interdict substantial compliance with its provisions under justifiable
circumstances.
 In the instant case, we cannot apply the "substantial compliance" rule to petitioners and be
as liberal minded. For one thing, counsel for petitioners gave a rather frail excuse for his non-
compliance, i.e., oversight and haste in ensuring that the petition would be filed at the earliest
possible time for the protection of his clients interests thereby overlooking the aforesaid
circular.[21]
In Ortiz v. Court of Appeals[22] which involves a similar set of facts, we ruled -
(I)t should be recalled that Revised Circular No. 28-91 provides that the party must certify under
oath that he has not commenced any other action or proceeding involving the same issues in the
Supreme Court, the Court of Appeals, or different Divisions thereof, or any other tribunal or
agency, and that to the best of his knowledge, no such action or proceeding is pending in the
Supreme Court x x x x
Petitioners admit that their lawyer x x x signed the Certification on Non-Forum
Shopping. Allegedly, Atty. Paulite has personal knowledge that the Ortizes had not commenced
any other action or proceeding involving the same parties and causes of action. Petitioners now
assert that their lawyers signature must be accepted as substantial compliance with the
requirements of the Circular.
Regrettably, we find that substantial compliance will not suffice in a matter involving strict
observance as provided for in Circular No. 28-91. The attestation contained in the certification on
non-forum shopping requires personal knowledge by the party who executed the same. To merit
the Courts consideration, petitioners here must show reasonable cause for failure to personally
sign the certification. The petitioners must convince the court that the outright dismissal of the
petition would defeat the administration of justice. However, the petitioners did not give any
explanation to warrant their exemption from the strict application of the rule utter disregard of the
rules cannot justly be rationalized by harking on the policy of liberal construction x x x x
Finally, petitioners argue that the delay in the proceedings in the court below was not
entirely their fault "as various circumstances and incidents beyond (their) control contributed to
the delay."[23]
Contrary to petitionerss assertions, their failure to present their evidence was their own
undoing. A review of the records shows that the trial court had scheduled a total of six (6)
hearing dates for the presentation of their evidence. These were 25 April 1996, 9 May 1996, 2
July 1996, 16 July 1996, 8 August 1996 and 20 August 1996. Five (5) of these trial dates were
cancelled at the instance of petitioners. They themselves admitted that the 9 May 1996 hearing
was postponed when Isagani Torres failed to appear in court because he was then
incarcerated. Likewise, through a motion petitioners were able to have the hearing on 2 July
1996 moved to 16 July 1996. However on said date petitioners counsel failed to appear on time,
thus prompting the trial court to declare petitioners right to present evidence as waived. As to the
8 August 1996 hearing, they moved to have the same reset, citing as reason the conflict of
schedule of their counsel. And when the trial court granted the motion and transferred the
hearing to 20 August 1996, petitioners once again submitted a motion praying that the hearing
be reset to 2 September 1996. From these repeated resettings, it can be gleaned that the delay
in the proceedings was largely, if not mainly, due to petitioners.
We also do not miss the fact that petitioners were represented by a law firm which meant
that any of its members could lawfully act as their counsel during the trial. As such petitioners
frequent motions to reset hearings by reason of their counsels unavailability should be cautiously
considered to make sure that these were not mere dilatory tactics.As observed by the lower
court, a perusal of the records shows that the case has been pending for a long period of time,
with the court often accommodating petitioners. Thus there could be no grave abuse of
discretion when the trial court finally ordered petitioners right to present evidence as waived to
put an end to their foot dragging. Indeed, it is never too often to say that justice delayed is justice
denied.
WHEREFORE, there being no reversible error committed by the Court of Appeals, the
petition for review on certiorari is DENIED and the assailed Resolution of 23 September 1996
summarily dismissing the petition for certiorari and the Resolution of 31 October 1996 denying
reconsideration are AFFIRMED. Consequently, the Regional Trial Court of Valenzuela, Metro
Manila, is DIRECTED forthwith to render its decision in Civil Case No. 3812-V-92 without
delay. Costs against petitioners.
SO ORDERED.
[CBD A.C. No. 313. January 30, 1998]
ATTY. AUGUSTO G. NAVARRO, for and in behalf of PAN-ASIA INTERNATIONAL
COMMODITIES, INC., complainant, vs. ATTY. ROSENDO MENESES
III, respondent.
DECISION
PER CURIAM:
This administrative case against respondent Atty. Rosendo Meneses III was initiated by a
complaint-affidavit[1] filed by Atty. Augusto G. Navarro on June 7, 1994 before the Commission
on Bar Discipline of the Integrated Bar of the Philippines (hereinafter, the Commission), for and
in behalf of Pan-Asia International Commodities, Inc. Herein complainant charges respondent
Meneses with the following offenses, viz.: (1) malpractice and gross misconduct unbecoming a
public defender; (2) dereliction of duty, by violating his oath to do everything within his power to
protect his clients interest; (3) willful abandonment; and (4) loss of trust and confidence, due to
his continued failure to account for the amount of P50,000.00 entrusted to him to be paid to a
certain complainant for the amicable settlement of a pending case. [2]
The complaint-affidavit alleged that Frankwell Management and Consultant, Inc., a group
of companies which includes Pan Asia International Commodities, Inc., through its
Administrative Manager Estrellita Valdez, engaged the legal services of respondent Atty.
Meneses. While serving as such counsel, Atty. Meneses handled various cases and was
properly compensated by his client in accordance with their retainer agreement. [3] One of the
litigations handled by him was the case of People vs. Lai Chan Kow, a.k.a. Wilson Lai, and
Arthur Bretaa, pending before Branch 134, Regional Trial Court of Makati. On December 24.
1993, respondent received the sum of P50,000.00 from Arthur Bretaa, the accused in said case,
to be given to therein offended party, a certain Gleason, as consideration for an out-of-court
settlement and with the understanding that a motion to dismiss the case would be filed by
respondent Meneses.
Despite subsequent repeated requests, respondent failed to present to his client the
receipt acknowledging that Gleason received said amount. A verification made with the Regional
Trial Court of Makati revealed that no motion to dismiss or any pleading in connection therewith
had been filed, and the supposed amicable settlement was not finalized and concluded. Despite
repeated demands in writing or by telephone for an explanation, as well as the turnover of all
documents pertaining to the aforementioned case, respondent Meneses deliberately ignored the
pleas of herein complainant.
The case was assigned by the Commission to Commissioner Victor C. Fernandez for
investigation.Respondent was thereafter ordered to submit his answer to the complaint pursuant
to Section 5, rule 139-B of the Rules of Court.[4] Two successive ex parte motions for extension
of time to file an answer were filed by respondent and granted by the Commission. [5] On
November 14, 1994, respondent filed a motion to dismiss,[6] instead of an answer.
In said motion, respondent argued that Atty. Navarro had no legal personality to sue him
for and in behalf of Pan-Asia International Commodities, Inc. because his legal services were
retained by Frankwell Management and Consultant, Inc.; that Navarro had not represented Pan-
Asia International Commodities, Inc. in any case nor had been authorized by its board
of directors to file this disbarment case against respondent; that the retainer agreement between
him and Frankwell Management and Consultant, Inc. had been terminated as of December 31,
1993 according to the verbal advice of its Administrative Officer Estrellita Valdez; that the case
of Arthur Bretaa was not part of their retainer agreement, and Bretaa was not an employee of
Frankwell Management and Consultant, Inc. which retained him as its legal counsel; and that the
settlement of said case cannot be concluded because the same was archived and accused
Bretaa is presently out of the country.
Herein complainant, in his opposition to the motion to dismiss, [7] stresses that respondent
Meneses is resorting to technicalities to evade the issue of his failure to account for the amount
of P 50,000.00 entrusted to him; that the respondents arguments in his motion to dismiss were
all designed to mislead the Commission; and that he was fully aware of the interrelationship of
the two corporations and always coordinated his legal work with Estrellita Valdez.
On November 28, 1994, Investigating Commissioner Victor C. Fernandez resolved to deny
said motion to dismiss for lack of merit and directed respondent to file his answer. [8] On January
2, 1995, respondent filed a manifestation that he was adopting the allegations in his motion to
dismiss his answer.[9]When the case was set for hearing on February 9, 1995, respondent failed
to attend despite due notice.He thereafter moved to postpone and reset the hearing of the case
several times allegedly due to problems with his health.
On the scheduled hearing on June 15, 1995, respondent again failed to attend. The
commissioner accordingly received an ex parte the testimony of complainants sole witness,
Estrellita Valdez, and other documentary evidence.[10] Thereafter, complainant rested its
case. Respondent filed a so-called Urgent Ex-parte Motion for Reconsideration with Motion to
Recall Complainants Witness for Cross-Examination[11]which was granted by the
Commission.[12] Estrellita Valdez was directed by the Commission to appear on the scheduled
hearing for cross-examination.
Several postponement and resetting of hearings were later requested and granted by the
Commission.When the case was set for hearing for the last time on May 31, 1996, respondent
failed to attend despite due notice and repeated warnings. Consequently, the Commission
considered him to have waived his right to present evidence in his defense and declared the
case submitted for resolution.[13]
On February 4, 1997, the Commission on Bar Discipline, through its Investigating
Commissioner Victor C. Fernandez, submitted its Report and Recommendation[14] to the Board
of Governors of the Integrated Bar of the Philippines. The Commission ruled that the refusal
and/or failure of respondent to account for the sum of P50,000.00 he received from complainant
for the settlement of the aforestated case of Lai Chan Kow and Arthur Bretaa proves beyond any
shadow of a doubt that he misappropriated the same, hence he deserved to be penalized.
The Commission recommended that respondent Meneses he suspended from the practice
of the legal profession for a period of three (3) years and directed to return the P50,000.00 he
received from the petitioner within fifteen (15) days from notice of the resolution. It further
provided that failure on his part to comply with such requirement would result in his
disbarment.[15] The Board of Governors adopted and approved the report and recommendation
of the Investigating Commissioner in its Resolution No. XII-97-133, dated July 26, 1997.[16]
On August 15, 1997, the Court received the Notice of Resolution, the Report and
Recommendation of the Investigating Commissioner, and the records of this case through the
Office of the Bar Confidant for final action pursuant to Section 12 (b) of Rule 139-B.[17] It appears
therefrom that respondent was duly furnished a copy of said resolution, with the investigating
commissioners report and recommendation annexed thereto.
The Court agrees with the findings and conclusion of the Integrated Bar of the Philippines
that respondent Meneses misappropriated the money entrusted to him and which he has failed
and/or refused to account for to his client despite repeated demands therefor. Such conduct on
the part of respondent indicating his unfitness for the confidence and trust reposed on him, or
showing such lack of personal honesty or of good moral character as to render him unworthy of
public confidence, constitutes a ground for disciplinary action extending to disbarment. [18]
Respondent Meneses misconduct constitute a gross violation of his oath as a lawyer
which, inter alia, imposes upon every lawyer the duty to delay no man for money or malice. He
blatantly disregarded Rule 16.01 of Canon 16 of the Code of Professional Responsibility which
provides that a lawyer shall account for all money or property collected or received for or from
his client. Respondent was merely holding in trust the money he received from his client to used
as consideration for amicable settlement of a case he was handling. Since the amicable
settlement did no materialize, he was necessarily under obligation to immediate return the
money, as there is no showing that he has a lien over it. As a lawyer, he should be scrupulously
careful in handling money entrusted to him in his professional capacity, because a high degree
of fidelity and good faith on his part is exacted.[19]
The argument of respondent that complainant has no legal personality to sue him is
unavailing.Section 1 Rule 139-B of the Rules of Court provides that proceedings for the
disbarment, suspension, or discipline of attorneys may be taken by the Supreme Court motu
propio or by the Integrated Bar of the Philippines upon the verified complainant of any
person. The right to institute a disbarment proceeding is not confined to clients nor is it
necessary that the person complaining suffered injury from the alleged wrongdoing. Disbarment
proceedings are matters of public interest and the only basis for judgment is the proof or failure
of proof of the charge. The evidence submitted by complainant before the Commission on Bar
Discipline sufficed to sustain its resolution and recommended sanctions.
It is settled that a lawyer is not obliged to act as counsel for every person who may wish to
become his client. He has the right to decline employment[20] subject however, to the provision of
Canon 14 of the Code of Professional Responsibility.[21] Once he agrees to take up the cause of
a client, he owes fidelity to such cause and must always be mindful of the trust and confidence
reposed to him.[22] Respondent Meneses, as counsel, had the obligation to inform his client of
the status of the case and to respond within a reasonable time to his clients request for
information. Respondents failure to communicate with his client by deliberately disregarding its
request for an audience or conference is an unjustifiable denial of its right to be fully informed of
the developments in and the status of its case.
On January 7, 1998, the Bar Confidant submitted to the Court a copy of the letter of Atty.
Augusto G. Navarro, dated December 18, 1997, to the effect that although a copy of the
aforestated Resolution No. XII-97-133 was personally delivered to respondents address and
received by his wife on October 9, 1997, he had failed to restitute the amount of P50,000.00 to
complainant within the 15-day period provided therein. Neither has he filed with this Court any
pleading or written indication of his having returned said amount to complainant. In line with the
resolution in this case, his disbarment is consequently warranted and exigent.
A note and advice on the penalty imposed in the resolution is in order. The dispositive
portion thereof provides that:
x x x Respondent Atty. Rosendo Meneses is hereby SUSPENDED from the practice
of law for three (3) years and is hereby directed to return the Fifty Thousand Pesos
he received from the petitioner within fifteen (15) days from receipt of this
resolution. Failure on his part to comply will result (i)n his DISBARMENT. [23]
In other words, it effectively purports to impose either a 3-year suspension or disbarment,
depending on whether or not respondent duly returns the amount to complainant. Viewed from
another angle, it directs that he shall only be suspended, subject to the condition that he should
make restitution as prescribed therein.
Dispositions of this nature should be avoided. In the imposition of penalties in criminal
cases, it has long been the rule that the penalty imposed in a judgment cannot be in the
alternative, even if the law provides for alternative penalties, [24] not can such penalty be subject
to a condition.[25] There is no reason why such legal principles in penal law should not apply in
administrative disciplinary actions which, as in this case, also involve punitive sanctions.
Besides, if the purpose was to extenuate the liability of respondent, the only possible and
equivalent rule is in malversation cases holding that the restitution of the peculated funds would
be analogous to voluntary surrender if it was immediately and voluntarily made before the case
was instituted.[26] The evidently is not the situation here. Also the implementation of the penalty
provided in the resolution will involve a cumbersome process since, in order to arrive at the final
action to be taken by this Court, it will have to wait for a verified report on whether or not
respondent complied with the condition subsequent.
WHEREFORE, Atty. Rosendo Meneses III is hereby DISBARRED. Let a copy of this
decision be attached to respondents personal records in this Court and furnished the Integrated
Bar of the Philippines, together with all courts in the county.
SO ORDERED.
CANON 19
G.R. No. L-40136 March 25, 1975
COSMOS FOUNDRY SHOP WORKERS UNION and FILEMON G. ALVAREZ, petitioners,
vs.
LO BU and COURT OF APPEALS, respondents.
Filemon G. Alvarez for petitioners.
Yolando F Busmente for respondent Lo Bu.
FERNANDO, J.:ñé+.£ªwph!1
The jurisdiction of respondent Court of Appeals is assailed in this certiorari and prohibition
proceeding. It is taken to task for entertaining an appeal from the Court of First Instance on a
replevin suit which was correctly dismissed as it had all the earmarks of a subterfuge that was
resorted to for the purpose of frustrating the execution of a judgment in an unfair labor practice
controversy, one moreover already passed upon and sustained by this Court. Petitioner Cosmos
Foundry Shop Workers Union is the prevailing party in that labor dispute which unfortunately had
dragged on since 1961, all its efforts to obtain what was due it being rendered illusory through
the machinations of a certain Ong Ting, now deceased, and the private respondent Lo Bu. The
lack of competence of respondent Court of Appeals to proceed further is thus rather obvious. It
is about time that there be an effective vindication of the rights of petitioner labor union, so long
set at naught and disregarded, by the employment of techniques, which certainly deserve no
encouragement, much less approval. There was a grave infirmity then in the Court of Appeals
having dismissed the appeal, reinstating it in its resolution of December 19, 1974. Certiorari and
prohibition lie.
The facts show that on January 16, 1973, petitioner Cosmos Foundry Shop Workers Union was
able to obtain from the Court of Industrial Relations the third alias writ of execution for the
satisfaction and enforcement of the judgment in its favor. 1 Thereafter, Deputy Sheriff Mario
Abiog of Manila, who was especially deputized to serve the writ, did so on January 17 and 18,
1973 levying on the personal properties of the Cosmos Foundry Shop or the New Century
Foundry Shop for the purpose of conducting the public auction sale.2 It was then that respondent
Lo Bu filed an urgent motion to recall writ of execution, asserting lack of jurisdiction of the Court
of Industrial Relations, a point stressed in another motion dated February 2, 1973, on the further
ground that petitioner Cosmos Foundry Shop Workers Union failed to put up an indemnity bond.
The Court of Industrial Relations in its order dated February 23, 1973 denied his motions. So
likewise was the motion for reconsideration, as shown in its order dated March 23, 1973. Private
respondent appealed by certiorari such order to this Court. It was docketed as G.R. No. L-
36636.3This Court, in its resolution dated July 17, 1973, denied the petition for certiorari of
private respondent.4 In the meanwhile, there was a replevin suit by private respondent in the
Court of First Instance of Manila covering the same properties. Upon receipt of the order from
this Court denying certiorari, petitioner labor union filed a second motion to dismiss the
complaint. It was therein alleged that private respondent has no cause of action, he being a
fictitious buyer based on the findings of the Court of Industrial Relations in its order dated June
22, 1970 and affirmed by the Supreme Court in its resolution dated July 17, 1973. The lower
court dismissed the complaint.5 That is the decision elevated to the Court of Appeals, and it is
precisely because of its obvious character as a further delaying tactic that this petition is filed.
Petitioner labor union has made out a case for certiorari and prohibition.
1. The order of the Court of Industrial Relations in the unfair labor practice case dated June 27,
19706 for the satisfaction and enforcement of which the third alias writ of execution was issued in
favor of petitioner labor union starts with the following: "This concerns complainant's motion for
the issuance of an alias writ of execution, dated March 12, 1970, "allowing the Sheriff to serve
the Writ and returnable within 60 days and the said writ should be directed to Cosmos Foundry
Shop or New Foundry Shop which is the firm name use(d) by the respondent in lieu of the
Cosmos Foundry Shop ... The original writ of execution had been returned wholly unsatisfied as
respondents had no visible properties found in their names, and the foundry shop where Mrs.
Ong Ting and her family reside at Maisan, Valenzuela, Bulacan, is the "New Century Foundry
Shop" (return of the Deputy Provincial Sheriff of Bulacan, dated March 11, 1970). Consequently,
in its Order of March 19, 1970, the Court directed the examination of Mrs. Ong Ting and the
Cosmos Foundry Shop concerning the latter's and Ong Ting's property and income. Extensive
hearings were conducted."7
Then comes this relevant portion: "From the evidence and the records, the Court finds that after
the Cosmos Foundry Shop was burned, Ong Ting established the New Century Foundry Shop.
He and his family resided in the premises of the shop at 118 Maisan Road, Valenzuela, Bulacan.
After his proposals to settle the present case for P5,000.00 in September 1968, for P25,000.00
in October 1968, and for P40,000.00 on December 22, 1968, were successively rejected by
complainant's counsel, Ong Ting, after hinting of taking measures to avoid liability, soon
executed a deed of absolute sale on December 31, 1968, selling all his business, including
equipment, machineries, improvements, materials, supplies and rights, in the New Century
Foundry Shop, to his compadre Lo Bu, for P20,000.00, which he acknowledged so fully paid ...
The deed does not bear the conformity of Mrs. Ong Ting. On January 7, 1969, when Lo Bu
applied for the original registration of the firm name, he gave his name as the manager and the
capital of the business as P30,000.00 ... Notwithstanding such sale to Lo Bu, Ong Ting filed a
verified urgent motion to reopen the case on January 25, 1969, and a verified motion for
reconsideration of the Decision on May 12, 1969. In the latter motion, it was alleged that as a
result of the fire, "Ong Ting lost everything; we cannot squeeze blood out of nothing ... " This
allegation was made despite the recent alleged sale to Lo Bu, from which he realized
P20,000.00."8 The absence of good faith on the part of respondent Lo Bu as the alleged vendee
was made clear thus: "There was no actual turn over of the business to Lo Bu, the alleged
manager in absentia. At the time Ong Ting died, he was still residing in the premises of the shop
... His family continued to reside therein without paying any rental to Lo Bu. His young 19-year- procedure. There would be no basis for legitimate grievance on the part of petitioners. It is not so
old son Delfin Ong became in-charge of the shop and the workers. His daughter Gloria Ong however in this case. The sad plight of petitioner labor union had been previously noted. It is
became the cashier. Mrs. Ong Ting became the manager and she supervised the work. .. The about time that a halt be called to the schemes utilized by respondent Lo Bu in his far-from-
alleged sale was no doubt intended to circumvent any judgment this Court might render commendable efforts to defeat labor's just claim. It would be repugnant to the principle of social
unfavorable to respondents. It is clearly fictitious. And such a declaration by this Court is well justice 14 and the mandate of protection to labor 15 if there be further delay in the satisfaction of a
within its jurisdiction because what is being sought is the enforcement or implementation of its judgment that ought to have been enforced years ago.
order. Having acquired jurisdiction, the Court may employ means to carry it into effect (Sec. 6,
Rule 135, Rules of Court)." 9
4. One last point. It was set forth in the Petition 16 that respondent Lo Bu filed an urgent motion
with the Court of Industrial Relations to recall the writ of execution alleging as one of his grounds
That was why in the dispositive portion of the aforesaid order, an alias writ of execution was lack of jurisdiction to pass upon the validity of the sale of the New Century Foundry Shop,
issued against the properties held in the name of the New Century Foundry Shop at 118 Maisan followed by another motion praying for the return of the levied properties this time asserting that
Road, Valenzuela, Bulacan for the satisfaction of the judgment in this unfair labor practice petitioner labor union failed to put up an indemnity bond and then a third, this time to allow the
proceeding. As noted, there was a replevin suit by the same vendee in bad faith, Lo Bu, which sheriff to keep the levied properties at his factory, all of which were denied by the Court en
was dismissed by the Court of First Instance of Manila precisely because in the meanwhile the banc in its order of March 23, 1973, assailed in the certiorari proceeding, dismissed by this Court
finality of the writ of execution became definitely settled when this Court issued its resolution of for lack of merit. 17 Counsel Yolando F. Busmente in his Answer to this petition, filed on February
July 17, 1973. 10 It denied the petition for certiorari filed by the private respondent, Lo Bu, for the 20, 1975, had the temerity to deny such allegations. He simply ignored the fact that as counsel
purpose of annulling the third writ of execution issued in accordance with the dispositive portion for respondent Lo Bu, petitioner in L-36636, he did specifically maintain: "On January 26, 1973,
of the order of the Court of June 22, 1970. in order to vindicate his rights over the levied properties, in an expeditious or less expensive
manner, herein appellant voluntarily submitted himself, as a forced intervenor, to the jurisdiction
of respondent CIR, by filing an urgent 'Motion to Recall Writ of Execution,' precisely questioning
2. To all intents and purposes then, that is the law of the case. What is worse, private
the jurisdiction of said Court to pass upon the validity and legality of the sale of the 'New Century
respondent Lo Bu certainly cannot plead ignorance, as he himself was the petitioner in the
Foundry Shop' to him, without the latter being made a party to the case, as well as the
certiorari proceeding before this Court. He failed, and ii was not surprising, for on the facts as
jurisdiction of said Court to enforce the Decision rendered against the respondents in Case No.
found, he was a principal in the nefarious scheme to frustrate the award in favor of petitioner
3021-ULP, by means of an alias writ of execution against his properties found at the 'New
labor union. There was thus a ruling as to the bad faith that characterized his pretension of being
Century Foundry Shop;' ... ; Petitioner appellant's urgent motion aforesaid was set for hearing on
the alleged vendee. In Cruz v. Philippine Association of Free Labor Unions 11 it was shown that
February 5, 1973, and inasmuch as the auction sale of his properties was set for January 31,
to avoid the legal consequences of an unfair labor practice, there was a fictitious sale resorted
1973, the CIR issued an order on January 30, 1973, one day before the schedule sale, ordering
to, as in this case. Under the circumstances, the bad faith being evident, the ostensible vendee
the Sheriff of Manila not to proceed with the auction sale; ... ; On February 3, 1973, herein
was precluded from taking advantage of the situation. So it must be here. Moreover, that is
petitioner-appellant [Lo Bu] filed another urgent motion dated February 2, 1973, praying for the
merely, as stated earlier, to accord deference to the fundamental principle of the law of the case,
return of his properties on the ground that the judgment creditor (respondent-appellee) failed to
his petition for certiorari having been dismissed by this Court. There is this excerpt from the
put up an indemnity bond, pursuant to the provision of Section 17, Rule 39 of the Rules of Court;
recent decision of Mangayao v. De Guzman: 12 "The latest case in point as of the time the order
... On February 10, 1973 respondent-appellee Cosmos Foundry Workers Union interposed its
complained of was issued is Kabigting v. Acting Director of Prisons, a 1962 decision. As
opposition to herein petitioner-appellant's urgent motions dated January 26, 1973 and February
emphasized by the ponente, the then Justice, now Chief Justice, Makalintal: 'It need not be
2, 1973, ... ; On February 27, 1973, herein petitioner-appellant received an order from
stated that the Supreme Court, being the court of last resort, is the final arbiter of all legal
respondent CIR, dated February 25, 1973, denying his urgent motions and ordering the Sheriff
questions properly brought before it and that its decision in any give case constitutes the law of
of Manila to proceed with the auction sale of his properties "in accordance with law;" ... " 18 Such
that particular case. Once its judgment becomes final it is binding on all inferior courts, and
conduct on the part of counsel is far from commendable. He could, of course, be casuistic and
hence beyond their power and authority to alter or modify. If petitioner had any ground to believe
take refuge in the fact that the paragraph of the petition, which he denied, was, in addition to
that the decision of this Court in Special Proceeding No. 12276 should further be reviewed his
being rather poorly and awkwardly worded, also prolix, with unnecessary matter being included
remedy was to ask for a reconsideration thereof. In fact he did file two motions for that purpose,
therein without due regard to logic or coherence or even rules of grammar. He could add that his
both of which were denied. A new petition before an inferior court on the same grounds was
denial was to be correlated with his special defenses, where he concentrated on points not
unjustified. As much, indeed, was clearly indicated by this Court in its resolution of April 3, 1959,
previously admitted. That is the most that can be said of his performance, and it is not enough.
herein above reproduced in its entirety. The import of the resolution is too plain to be
For even if such be the case, Attorney Busmente had not exculpated himself. He was of course
misunderstood.' So it has been from 1919, when in Compagnie Franco-Indochinoise v.
expected to defend his client's cause with zeal, but not at the disregard of the truth and in
Deutsche-Australische Dampschiffs Gesellschaft, this Court, through Justice Street,
defiance of the clear purpose of labor statutes. He ought to remember that his obligation as an
categorically declared that a decision that has become the law of the case "is not subject to
officer of the court, no less than the dignity of the profession, requires that he should not act like
review or reversal in any court." What is more, in 1967, there is a reaffirmation of the doctrine by
an errand-boy at the beck and call of his client, ready and eager to do his every bidding. If he
this Tribunal in People v. Olarte where it was stressed by Justice J.B.L. Reyes that a ruling
fails to keep that admonition in mind, then he puts into serious question his good standing in the
constituting the law of the case, "even if erroneous, ... may no longer be disturbed or modified
bar.
since it has become final ... " Then, in Sanchez v. Court of Industrial Relations, promulgated in
1969, there is the pronouncement that the law of the case 'does not apply solely to what is
embodied in [this Court's] decision but likewise to its implementation carried out in fealty to what WHEREFORE, the writ of certiorari is granted and the order of December 19, 1974 of
has been ... decreed.'" 13 respondent Court of Appeals reinstating the appeal is nullified and set aside. The writ of
prohibition is likewise granted, respondent Court of Appeals being perpetually restrained from
taking any further action on such appeal, except that of dismissing it. Triple costs.
3. Private respondent, in his special and affirmative defenses, alleged that petitioners have a
plain and adequate remedy in the ordinary course of law being the appellees in the pending
case in the Court of Appeals sought to be dismissed in this suit for certiorari. As a general rule,
such a plea could be looked upon with sympathy. That is the ordinary course of judicial
 [G.R. No. L-6869. May 27, 1955.]
SOLEDAD BELANDRES, Plaintiff-Appellant, v. LOPEZ SUGAR CENTRAL MILL CO.,
INC., Defendant-Appellee.
Ramon C. Ditching for Appellant.
Cenando Urquiola, Melanio Lalisan and Manuel O. Soriano for Appellee.
SYLLABUS
1. PLEADING AND PRACTICE; SUBJECT MATTER OF CASE IS DETERMINED BY NATURE
AND CHARACTER OF THE PLEADINGS. — The subject matter of any given case is
determined not by the nature of the action which the party is entitled under the facts and the law
to bring, bring, but by the nature and character of the pleadings and issues submitted by the
parties to the court for trial and judgment.
2. ID.; ID.; DUTY OF COURT TO ACT ON THE MATTER IN ISSUE. — In the case at bar,
plaintiff seeks damages under the provisions of Article 2176 and Article 2180 of the Civil Code,
because it is alleged in her complaint that through fault or negligence of the defendant’s
employees, death was caused to her son while in the employ of defendant. It is not alleged in
the complaint that the deceased died because of accident due to and in the course of
employment, as defined in section 2 of Act No. 3428. Held: Under the pleadings submitted, the
court a quo has jurisdiction over the subject matter, because it is an action for damages caused
by the negligence of defendant’s employees. As such it was its duty to act on the matter in issue
as developed in the pleadings. If it was of the opinion that the plaintiff was not entitled to the
damage claimed in the complaint because the death was accidental, it should have made a
finding too this effect and dismissed the action, or absolved the defendant therefrom. But it could
not under the pleadings declare that it had no jurisdiction of the subject matter.
3. ATTORNEY AND CLIENT; LIMITATION OF POWER OF COUNSEL TO BIND HIS CLIENT.
— The admission of plaintiff’s counsel to the effect that his client’s action was one compensation
under the Workmen’s Compensation Act is not a ground for taking the action outside the
jurisdiction of the Court of First Instance, for such admission is certainly beyond the scope of
authority as counsel, for the same does not refer to any matter of judicial procedure related to
the enforcement of the remedy, but to the subject matter or cause of action of which the client
alone can make the binding admission.
DECISION
LABRADOR, J.:
This action was brought by the plaintiff-appellant to recover damages for the death of her son
Querubin Villa, a train conductor employed by defendant-appellee in the transportation of cane
to its mill. The complaint alleges that on May 5, 1952, while said Querubin Villa was riding as
train conductor on an empty car, some empty cars were derailed because of the negligence of
the employees of the defendant-appellee (the engine driver, superintendent, brakemen and
inspector), and the car on which he was riding was also derailed; that Villa fell from the empty
car on which he was riding and the wheels of the empty cars following that on which he rode
passed over his body, crushed some of his bones and caused his instant death. The complaint
asks for damages amounting to P9,000. The defendant-appellee admit in its answer that the
deceased Villa was a train conductor employed by it and that his death was occasioned by a
derailment of cars, but denies that the said empty cars were under its direct control, or that the
derailment thereof was caused by the negligence of its superintendent, machinist, or other
employee. It further alleges that it was the duty of Villa as conductor or brakeman to see that the
railroad tracks were open and free from obstruction and to notify the machinist of any obstacle
on the rails, but Villa, with apparent negligence and unpardonable carelessness, failed to see
that on the rails on which the cars were to pass, there were pieces of iron placed there by some
criminal hand and, therefore, failed to give the necessary signal so that the engine driver might
stop the train of cars in time to avoid the accident. In consequence, it prayed that the complaint
be dismissed.
After the issues were joined the parties entered into a partial statement of facts, the most
important of which is that the deceased died as a result of the derailment of a wagon of the
defendant- appellee caused by an obstacle on the rails. After the above stipulation was entered
into, plaintiff presented evidence to substantiate the allegations of the complaint. When plaintiff
had closed her evidence, attorney for the defendant moved for the dismissal of the case on the
ground that the court had no jurisdiction over the subject matter. Explaining its resolution, the
court said:jgc:chanrobles.com.ph
"No puede haber ninguna cuestion respecto a que la reclamacion de la demandante es una
sobre compensacion de obreros, no solamente por la misma naturaleza de las alegaciones de
la demanda y de la estipulacion de hechos, sino tambien porque el mismo abogado de la
demandante admitio en corta ebierta que el objeto de la demanda participa y tiene el caracter
de una reclamacion por compensacion de obreros. Si esto es asi, la reclamacion de la
demandante debe regirse por las disposiciones de la Ley sobre compensacion de obreros, o
sea, por la Ley No. 3428 tal como fue sucesivamente enmendaba por la Ley No. 3812, por la
Ley del Commonwealth No. 210 y, ultimamente, por la Ley de la Republica No. 772, a tenor del
articulo 2196 del Codico Civil de Filipinas que, en parte, dispone:jgc:chanrobles.com.ph
". . . Compensation for workmen and other employees in case of death, injury or illness is
regulated by special laws . . ."cralaw virtua1aw library
Plaintiff appealed from the dismissal and now contends that the lower court erred in holding that
it had no jurisdiction over the case and in not granting relief to the plaintiff.
It is very evident that the action is not one for compensation with the provisions of the
Workmen’s Compensation Act (Act No. 3428 as amended). The subject matter of any given
case is determined, not by the nature of the action which the party is entitled under the facts and
the law to bring, but by the nature and character of the pleadings and issues submitted by the
parties to the court for trial and judgment. The plaintiff in this case seeks damages under the
provisions of Article 2176 and Article 2180 of the Civil Code, because it is alleged in her
complaint that through fault or negligence of the defendant’s employees, death was caused to
her son while in the employ of defendant. It is not alleged in the complaint that the deceased
died because of accident due to and in the course of employment, as defined in section 2 of Act
No. 3428, as it is expressly alleged that the death was caused by the negligence of defendant’s
employees. Under the pleadings, therefore, the court a quo had jurisdiction over the subject
matter, because it is an action for damages caused by the negligence of defendant’s
employees.
It would seem to appear from the decision of the court a quo that the judge was of the opinion
that plaintiff’s action should have been one for compensation under Act No. 3428, perhaps
because the evidence supporting the claim of negligence on the part of the defendant’s
employees may not have been sufficient to support the same; in other words, that the death was
accidental. His Honor’s opinion, however, as to the action which the plaintiff is entitled to bring
under the facts proven in the course of the trial, does not control or determine the nature or
character of the case under trial, for it is the pleadings that do so. The court should have acted
on the matter in issue as developed in the pleadings; it was its duty to do so. If it was of the
opinion that the plaintiff-appellee was not entitled to the damages claimed in the complaint
because the death was accidental, it should have made a finding to this effect and dismissed the
action, or absolved the defendant therefrom. It could not under the pleadings declare that it had
no jurisdiction of the subject matter.
We note that one of the reasons stated by the Judge in dismissing the case is the supposed
admission of plaintiff’s counsel that the action is in the nature of a claim for compensation for a
workman. The judge must have misunderstood counsel, or the latter must have failed to make
his meaning clear. But admitting that he did admit his client’s action was one for compensation
under the Workmen’s Compensation Act, his admission or statement in that respect is certainly
beyond the scope of his authority as counsel, for the same does not refer to any matter of
judicial procedure related to the enforcement of the remedy, but to the subject matter or cause of
action. As to this, client alone can make the binding admission.
"The broad implied or apparent powers of an attorney with respect to the conduct or control of
litigation are, however, limited to matters which relate only to the procedure or remedy. The
employment of itself confers upon the attorney no implied or apparent power or authority over
the subject matter of the cause of action or defense; and, unless the attorney has expressly
been granted authority with respect thereto, the power to deal with or surrender these matters is
regarded as remaining exclusively in the client" (7 C. J. S. pp. 899-900.)
"The line of demarcation between the respective rights and powers of an attorney and his client
is clearly defined. The cause of action, the claim or demand sued upon, and the subject matter
of the litigation are all within the exclusive control of a client; and an attorney may not impair,
compromise, settle, surrender, or destroy them without his client’s consent. But all the
proceedings in court to enforce the remedy to bring the claim, demand, cause of action, or
subject matter of the suit to hearing, trial, determination, judgment, and execution, are within the
exclusive control of the attorney." (6 C. J. S., p. 643.)
The decision appealed from shall be reversed and the case remanded to the court a quo for
continuation of the trial and the proceedings in accordance herewith. So ordered.
CANON 21
[G.R. No. 105938. September 20, 1996]
TEODORO R. REGALA, EDGARDO J. ANGARA, AVELINO V. CRUZ, JOSE C.
CONCEPCION, ROGELIO A. VINLUAN, VICTOR P. LAZATIN, and EDUARDO U.
ESCUETA, petitioners, vs. THE HONORABLE SANDIGANBAYAN, First Division,
REPUBLIC OF THE PHILIPPINES, ACTING THROUGH THE PRESIDENTIAL COMMISSION
ON GOOD GOVERNMENT, and RAUL S. ROCO, respondents.
[G.R. No. 108113. September 20, 1996]
PARAJA G. HAYUDINI, petitioner, vs. THE SANDIGANBAYAN and THE REPUBLIC OF THE
PHILIPPINES, respondents.
DECISION
KAPUNAN, J.:
These cases touch the very cornerstone of every State's judicial system, upon which the
workings of the contentious and adversarial system in the Philippine legal process are based -
the sanctity of fiduciary duty in the client-lawyer relationship. The fiduciary duty of a counsel and
advocate is also what makes the law profession a unique position of trust and confidence, which
distinguishes it from any other calling. In this instance, we have no recourse but to uphold and
strengthen the mantle of protection accorded to the confidentiality that proceeds from the
performance of the lawyer's duty to his client.
The facts of the case are undisputed.
The matters raised herein are an offshoot of the institution of the Complaint on July 31,
1987 before the Sandiganbayan by the Republic of the Philippines, through the Presidential
Commission on Good Government against Eduardo M. Cojuangco, Jr., as one of the principal
defendants, for the recovery of alleged ill-gotten wealth, which includes shares of stocks in the
named corporations in PCGG Case No. 33 (Civil Case No. 0033), entitled "Republic of the
Philippines versus Eduardo Cojuangco, et al."[1]
Among the defendants named in the case are herein petitioners Teodoro Regala, Edgardo
J. Angara, Avelino V. Cruz, Jose C. Concepcion, Rogelio A. Vinluan, Victor P. Lazatin, Eduardo
U. Escueta and Paraja G. Hayudini, and herein private respondent Raul S. Roco, who all were
then partners of the law firm Angara, Abello, Concepcion, Regala and Cruz Law Offices
(hereinafter referred to as the ACCRA Law Firm). ACCRA Law Firm performed legal services for
its clients, which included, among others, the organization and acquisition of business
associations and/or organizations, with the correlative and incidental services where its
members acted as incorporators, or simply, as stockholders. More specifically, in the
performance of these services, the members of the law firm delivered to its client documents
which substantiate the client's equity holdings, i.e., stock certificates endorsed in blank
representing the shares registered in the client's name, and a blank deed of trust or assignment
covering said shares. In the course of their dealings with their clients, the members of the law
firm acquire information relative to the assets of clients as well as their personal and business
circumstances. As members of the ACCRA Law Firm, petitioners and private respondent Raul
Roco admit that they assisted in the organization and acquisition of the companies included in
Civil Case No. 0033, and in keeping with the office practice, ACCRA lawyers acted as
nominees-stockholders of the said corporations involved in sequestration proceedings.[2]
On August 20, 1991, respondent Presidential Commission on Good Government
(hereinafter referred to as respondent PCGG) filed a "Motion to Admit Third Amended
Complaint" and "Third Amended Complaint" which excluded private respondent Raul S.
Roco from the complaint in PCGG Case No. 33 as party-defendant.[3] Respondent PCGG based
its exclusion of private respondent Roco as party-defendant on his undertaking that he will
reveal the identity of the principal/s for whom he acted as nominee/stockholder in the companies
involved in PCGG Case No. 33.[4]
Petitioners were included in the Third Amended Complaint on the strength of the following
allegations:
14. Defendants Eduardo Cojuangco, Jr., Edgardo J. Angara, Jose C. Concepcion,
Teodoro Regala, Avelino V. Cruz, Rogelio A. Vinluan, Eduardo U. Escueta,
Paraja G. Hayudini and Raul Roco of the Angara Concepcion Cruz Regala and
Abello law offices (ACCRA) plotted, devised, schemed. conspired and
confederated with each other in setting up, through the use of the coconut levy
funds, the financial and corporate framework and structures that led to the
establishment of UCPB, UNICOM, COCOLIFE, COCOMARK, CIC, and more
than twenty other coconut levy funded corporations, including the acquisition of
San Miguel Corporation shares and its institutionalization through presidential
directives of the coconut monopoly. Through insidious means and
machinations, ACCRA, being the wholly-owned investment arm, ACCRA
Investments Corporation, became the holder of approximately fifteen million
shares representing roughly 3.3% of the total outstanding capital stock of UCPB
as of 31 March 1987.This ranks ACCRA Investments Corporation number 44
among the top 100 biggest stockholders of UCPB which has approximately
1,400,000 shareholders. On the other hand, corporate books show the name
Edgardo J. Angara as holding approximately 3,744 shares as of February,
1984.[5]
In their answer to the Expanded Amended Complaint, petitioners ACCRA lawyers alleged
that:
4.4. Defendants-ACCRA lawyers participation in the acts with which their co-defendants are
charged, was in furtherance of legitimate lawyering.
4.4.1. In the course of rendering professional and legal services to clients, defendants-ACCRA
lawyers, Jose C. Concepcion, Teodoro D. Regala, Rogelio A. Vinluan and Eduardo U. Escueta,
became holders of shares of stock in the corporations listed under their respective names in
Annex A of the expanded Amended Complaint as incorporating or acquiring stockholders only
and, as such, they do not claim any proprietary interest in the said shares of stock.
4.5. Defendant ACCRA-lawyer Avelino V. Cruz was one of the incorporators in 1976 of Mermaid
Marketing Corporation, which was organized for legitimate business purposes not related to the
allegations of the expanded Amended Complaint. However, he has long ago transferred any
material interest therein and therefore denies that the shares appearing in his name in Annex A
of the expanded Amended Complaint are his assets.[6]
Petitioner Paraja Hayudini, who had separated from ACCRA law firm, filed a separate
answer denying the allegations in the complaint implicating him in the alleged ill-gotten wealth.[7]
Petitioners ACCRA lawyers subsequently filed their "COMMENT AND/OR OPPOSITION"
dated October 8, 1991 with Counter-Motion that respondent PCGG similarly grant the same
treatment to them (exclusion as parties-defendants) as accorded private respondent Roco.[8] The
Counter-Motion for dropping petitioners from the complaint was duly set for hearing on October
18, 1991 in accordance with the requirements of Rule 15 of the Rules of Court.
In its "Comment," respondent PCGG set the following conditions precedent for the
exclusion of petitioners, namely: (a) the disclosure of the identity of its clients; (b) submission of
documents substantiating the lawyer-client relationship; and (c) the submission of the deeds of
assignments petitioners executed in favor of its clients covering their respective shareholdings. [9]
Consequently, respondent PCGG presented supposed proof to substantiate compliance
by private respondent Roco of the conditions precedent to warrant the latter's exclusion as party-
defendant in PCGG Case No. 33, to wit: (a) Letter to respondent PCGG of the counsel of
respondent Roco dated May 24, 1989 reiterating a previous request for reinvestigation by the
PCGG in PCGG Case No. 33; (b) Affidavit dated March 8, 1989 executed by private respondent
Roco as Attachment to the letter aforestated in (a); and (c) Letter of the Roco, Bunag, and
Kapunan Law Offices dated September 21, 1988 to the respondent PCGG in behalf of private
respondent Roco originally requesting the reinvestigation and/or re-examination of the evidence
of the PCGG against Roco in its Complaint in PCGG Case No. 33.[10]
It is noteworthy that during said proceedings, private respondent Roco did not refute
petitioners' contention that he did actually not reveal the identity of the client involved in PCGG
Case No. 33, nor had he undertaken to reveal the identity of the client for whom he acted as
nominee-stockholder.[11]
On March 18, 1992, respondent Sandiganbayan promulgated the Resolution, herein
questioned, denying the exclusion of petitioners in PCGG Case No. 33, for their refusal to
comply with the conditions required by respondent PCGG. It held:
x x x.
ACCRA lawyers may take the heroic stance of not revealing the identity of the client for whom
they have acted, i.e. their principal, and that will be their choice. But until they do identify their
clients, considerations of whether or not the privilege claimed by the ACCRA lawyers exists
cannot even begin to be debated. The ACCRA lawyers cannot excuse themselves from
the consequences of their acts until they have begun to establish the basis for recognizing the
privilege; the existence and identity of the client.
This is what appears to be the cause for which they have been impleaded by the PCGG as
defendants herein.
5. The PCGG is satisfied that defendant Roco has demonstrated his agency and that Roco has
apparently identified his principal, which revelation could show the lack of cause against
him. This in turn has allowed the PCGG to exercise its power both under the rules of Agency
and under Section 5 of E.O. No. 14-A in relation to the Supreme Court's ruling in Republic v.
Sandiganbayan (173 SCRA 72).
The PCGG has apparently offered to the ACCRA lawyers the same conditions availed of by
Roco; full disclosure in exchange for exclusion from these proceedings (par. 7, PCGG's
COMMENT dated November 4, 1991). The ACCRA lawyers have preferred not to make the
disclosures required by the PCGG.
The ACCRA lawyers cannot, therefore, begrudge the PCGG for keeping them as party
defendants. In the same vein, they cannot compel the PCGG to be accorded the same treatment
accorded to Roco.
Neither can this Court.
WHEREFORE, the Counter Motion dated October 8, 1991 filed by the ACCRA lawyers and
joined in by Atty. Paraja G. Hayudini for the same treatment by the PCGG as accorded to Raul
S. Roco is DENIED for lack of merit.[12]
ACCRA lawyers moved for a reconsideration of the above resolution but the same was
denied by the respondent Sandiganbayan. Hence, the ACCRA lawyers filed the petition
for certiorari, docketed as G.R. No. 105938, invoking the following grounds:
I
The Honorable Sandiganbayan gravely abused its discretion in subjecting petitioners ACCRA
lawyers who undisputably acted as lawyers in serving as nominee-stockholders, to the strict
application of the law of agency.
II
The Honorable Sandiganbayan committed grave abuse of discretion in not considering
petitioners ACCRA lawyers and Mr. Roco as similarly situated and, therefore, deserving of equal
treatment.
1. There is absolutely no evidence that Mr. Roco had revealed, or had undertaken to
reveal, the identities of the client(s) for whom he acted as nominee-stockholder.
2. Even assuming that Mr. Roco had revealed, or had undertaken to reveal, the
identities of the client(s), the disclosure does not constitute a substantial
distinction as would make the classification reasonable under the equal
protection clause.
3. Respondent Sandiganbayan sanctioned favoritism and undue preference in favor
of Mr. Roco in violation of the equal protection clause.
III
The Honorable Sandiganbayan committed grave abuse of discretion in not holding that, under
the facts of this case, the attorney-client privilege prohibits petitioners ACCRA lawyers from
revealing the identity of their client(s) and the other information requested by the PCGG.
1. Under the peculiar facts of this case, the attorney-client privilege includes the
identity of the client(s).
2. The factual disclosures required by the PCGG are not limited to the identity of
petitioners ACCRA lawyers' alleged client(s) but extend to other privileged
matters.
IV
The Honorable Sandiganbayan committed grave abuse of discretion in not requiring that the
dropping of party-defendants by the PCGG must be based on reasonable and just grounds and
with due consideration to the constitutional right of petitioners ACCRA lawyers to the equal
protection of the law.
Petitioner Paraja G. Hayudini, likewise, filed his own motion for reconsideration of the
March 18, 1991 resolution which was denied by respondent Sandiganbayan. Thus, he filed a
separate petition for certiorari, docketed as G.R. No. 108113, assailing respondent
Sandiganbayan's resolution on essentially the same grounds averred by petitioners in G.R. No.
105938.
Petitioners contend that the exclusion of respondent Roco as party-defendant in PCGG
Case No. 33 grants him a favorable treatment, on the pretext of his alleged undertaking to
divulge the identity of his client, giving him an advantage over them who are in the same footing
as partners in the ACCRA law firm.Petitioners further argue that even granting that such an
undertaking has been assumed by private respondent Roco, they are prohibited from revealing
the identity of their principal under their sworn mandate and fiduciary duty as lawyers to uphold
at all times the confidentiality of information obtained during such lawyer-client relationship.
Respondent PCGG, through its counsel, refutes petitioners' contention, alleging that the
revelation of the identity of the client is not within the ambit of the lawyer-client confidentiality
privilege, nor are the documents it required (deeds of assignment) protected, because they are
evidence of nominee status.[13]
In his comment, respondent Roco asseverates that respondent PCGG acted correctly in
excluding him as party-defendant because he "(Roco) has not filed an Answer. PCGG had
therefore the right to dismiss Civil Case No. 0033 as to Roco `without an order of court by filing a
notice of dismissal,'"[14] and he has undertaken to identify his principal.[15]
Petitioners' contentions are impressed with merit.
I
It is quite apparent that petitioners were impleaded by the PCGG as co-defendants to
force them to disclose the identity of their clients. Clearly, respondent PCGG is not after
petitioners but the bigger fish as they say in street parlance. This ploy is quite clear from the
PCGGs willingness to cut a deal with petitioners -- the names of their clients in exchange for
exclusion from the complaint. The statement of the Sandiganbayan in its questioned resolution
dated March 18, 1992 is explicit:
ACCRA lawyers may take the heroic stance of not revealing the identity of the client for whom
they have acted, i.e., their principal, and that will be their choice. But until they do identify their
clients, considerations of whether or not the privilege claimed by the ACCRA lawyers exists
cannot even begin to be debated. The ACCRA lawyers cannot excuse themselves from the
consequences of their acts until they have begun to establish the basis for recognizing the
privilege; the existence and identity of the client.
This is what appears to be the cause for which they have been impleaded by the PCGG as
defendants herein.(Underscoring ours)
In a closely related case, Civil Case No. 0110 of the Sandiganbayan, Third Division,
entitled Primavera Farms, Inc., et al. vs. Presidential Commission on Good Government
respondent PCGG, through counsel Mario Ongkiko, manifested at the hearing on December 5,
1991 that the PCGG wanted to establish through the ACCRA that their so called client is Mr.
Eduardo Cojuangco; that it was Mr. Eduardo Cojuangco who furnished all the monies to those
subscription payments in corporations included in Annex A of the Third Amended Complaint;
that the ACCRA lawyers executed deeds of trust and deeds of assignment, some in the name of
particular persons, some in blank.
We quote Atty. Ongkiko:
ATTY. ONGKIKO:
With the permission of this Hon. Court. I propose to establish through these ACCRA lawyers
that, one, their so-called client is Mr. Eduardo Cojuangco. Second, it was Mr. Eduardo
Cojuangco who furnished all the monies to these subscription payments of these corporations
who are now the petitioners in this case. Third, that these lawyers executed deeds of trust, some
in the name of a particular person, some in blank. Now, these blank deeds are important to our
claim that some of the shares are actually being held by the nominees for the late President
Marcos. Fourth, they also executed deeds of assignment and some of these assignments have
also blank assignees. Again, this is important to our claim that some of the shares are for Mr.
Cojuangco and some are for Mr. Marcos. Fifth, that most of these corporations are really just
paper corporations. Why do we say that? One: There are no really fixed sets of officers, no fixed
sets of directors at the time of incorporation and even up to 1986, which is the crucial year. And
not only that, they have no permits from the municipal authorities in Makati. Next, actually all
their addresses now are care of Villareal Law Office. They really have no address on
records. These are some of the principal things that we would ask of these nominees
stockholders, as they called themselves.[16]
It would seem that petitioners are merely standing in for their clients as defendants in the
complaint.Petitioners are being prosecuted solely on the basis of activities and services
performed in the course of their duties as lawyers. Quite obviously, petitioners inclusion as co-
defendants in the complaint is merely being used as leverage to compel them to name their
clients and consequently to enable the PCGG to nail these clients. Such being the case,
respondent PCGG has no valid cause of action as against petitioners and should exclude them
from the Third Amended Complaint.
II
The nature of lawyer-client relationship is premised on the Roman Law concepts of locatio
conductio operarum (contract of lease of services) where one person lets his services and
another hires them without reference to the object of which the services are to be performed,
wherein lawyers' services may be compensated by honorarium or for
hire,[17] and mandato (contract of agency) wherein a friend on whom reliance could be placed
makes a contract in his name, but gives up all that he gained by the contract to the person who
requested him.[18] But the lawyer-client relationship is more than that of the principal-agent and
lessor-lessee.
In modern day perception of the lawyer-client relationship, an attorney is more than a mere
agent or servant, because he possesses special powers of trust and confidence reposed on him
by his client.[19] A lawyer is also as independent as the judge of the court, thus his powers are
entirely different from and superior to those of an ordinary agent. [20] Moreover, an attorney also
occupies what may be considered as a "quasi-judicial office" since he is in fact an officer of the
Court[21] and exercises his judgment in the choice of courses of action to be taken favorable to
his client.
Thus, in the creation of lawyer-client relationship, there are rules, ethical conduct and
duties that breathe life into it, among those, the fiduciary duty to his client which is of a very
delicate, exacting and confidential character, requiring a very high degree of fidelity and good
faith,[22] that is required by reason of necessity and public interest[23] based on the hypothesis
that abstinence from seeking legal advice in a good cause is an evil which is fatal to the
administration of justice.[24]
It is also the strict sense of fidelity of a lawyer to his client that distinguishes him from any
other professional in society. This conception is entrenched and embodies centuries of
established and stable tradition.[25] In Stockton v. Ford,[26] the U.S. Supreme Court held:
There are few of the business relations of life involving a higher trust and confidence than that of
attorney and client, or generally speaking, one more honorably and faithfully discharged; few
more anxiously guarded by the law, or governed by the sterner principles of morality and justice;
and it is the duty of the court to administer them in a corresponding spirit, and to be watchful and
industrious, to see that confidence thus reposed shall not be used to the detriment or prejudice
of the rights of the party bestowing it.[27]
In our jurisdiction, this privilege takes off from the old Code of Civil Procedure enacted by
the Philippine Commission on August 7, 1901. Section 383 of the Code specifically forbids
counsel, without authority of his client to reveal any communication made by the client to him or
his advice given thereon in the course of professional employment. [28] Passed on into various
provisions of the Rules of Court, the attorney-client privilege, as currently worded provides:
Sec. 24. Disqualification by reason of privileged communication. - The following persons cannot
testify as to matters learned in confidence in the following cases:
xxx
An attorney cannot, without the consent of his client, be examined as to any communication
made by the client to him, or his advice given thereon in the course of, or with a view to,
professional employment, can an attorneys secretary, stenographer, or clerk be examined,
without the consent of the client and his employer, concerning any fact the knowledge of which
has been acquired in such capacity.[29]
Further, Rule 138 of the Rules of Court states:
Sec. 20. It is the duty of an attorney:
(e) to maintain inviolate the confidence, and at every peril to himself, to preserve the secrets of
his client, and to accept no compensation in connection with his clients business except from
him or with his knowledge and approval.
This duty is explicitly mandated in Canon 17 of the Code of Professional Responsibility
which provides that:
Canon 17. A lawyer owes fidelity to the cause of his client and he shall be mindful of the trust
and confidence reposed in him.
Canon 15 of the Canons of Professional Ethics also demands a lawyer's fidelity to client:
The lawyer owes "entire devotion to the interest of the client, warm zeal in the maintenance and
defense of his rights and the exertion of his utmost learning and ability," to the end that nothing
be taken or be withheld from him, save by the rules of law, legally applied. No fear of judicial
disfavor or public popularity should restrain him from the full discharge of his duty. In the judicial
forum the client is entitled to the benefit of any and every remedy and defense that is authorized
by the law of the land, and he may expect his lawyer to assert every such remedy or
defense. But it is steadfastly to be borne in mind that the great trust of the lawyer is to be
performed within and not without the bounds of the law. The office of attorney does not permit,
much less does it demand of him for any client, violation of law or any manner of fraud or
chicanery. He must obey his own conscience and not that of his client.
Considerations favoring confidentiality in lawyer-client relationships are many and serve
several constitutional and policy concerns. In the constitutional sphere, the privilege gives flesh
to one of the most sacrosanct rights available to the accused, the right to counsel. If a client
were made to choose between legal representation without effective communication and
disclosure and legal representation with all his secrets revealed then he might be compelled, in
some instances, to either opt to stay away from the judicial system or to lose the right to
counsel. If the price of disclosure is too high, or if it amounts to self incrimination, then the flow of
information would be curtailed thereby rendering the right practically nugatory. The threat this
represents against another sacrosanct individual right, the right to be presumed innocent is at
once self-evident.
Encouraging full disclosure to a lawyer by one seeking legal services opens the door to a
whole spectrum of legal options which would otherwise be circumscribed by limited information
engendered by a fear of disclosure. An effective lawyer-client relationship is largely dependent
upon the degree of confidence which exists between lawyer and client which in turn requires a
situation which encourages a dynamic and fruitful exchange and flow of information. It
necessarily follows that in order to attain effective representation, the lawyer must invoke the
privilege not as a matter of option but as a matter of duty and professional responsibility.
The question now arises whether or not this duty may be asserted in refusing to disclose
the name of petitioners' client(s) in the case at bar. Under the facts and circumstances obtaining
in the instant case, the answer must be in the affirmative.
As a matter of public policy, a clients identity should not be shrouded in mystery. [30] Under
this premise, the general rule in our jurisdiction as well as in the United States is that a lawyer
may not invoke the privilege and refuse to divulge the name or identity of his client. [31]
The reasons advanced for the general rule are well established.
First, the court has a right to know that the client whose privileged information is sought to
be protected is flesh and blood.
Second, the privilege begins to exist only after the attorney-client relationship has been
established.The attorney-client privilege does not attach until there is a client.
Third, the privilege generally pertains to the subject matter of the relationship.
Finally, due process considerations require that the opposing party should, as a general
rule, know his adversary. A party suing or sued is entitled to know who his opponent is. [32] He
cannot be obliged to grope in the dark against unknown forces. [33]
Notwithstanding these considerations, the general rule is however qualified by some
important exceptions.
 1) Client identity is privileged where a strong probability exists that revealing the
clients name would implicate that client in the very activity for which he sought
the lawyers advice.
In Ex-Parte Enzor,[34] a state supreme court reversed a lower court order requiring a
lawyer to divulge the name of her client on the ground that the subject matter of the relationship
was so closely related to the issue of the clients identity that the privilege actually attached to
both. In Enzor, the unidentified client, an election official, informed his attorney in confidence that
he had been offered a bribe to violate election laws or that he had accepted a bribe to that
end. In her testimony, the attorney revealed that she had advised her client to count the votes
correctly, but averred that she could not remember whether her client had been, in fact,
bribed. The lawyer was cited for contempt for her refusal to reveal his clients identity before a
grand jury. Reversing the lower courts contempt orders, the state supreme court held that under
the circumstances of the case, and under the exceptions described above, even the name of the
client was privileged.
U.S. v. Hodge and Zweig,[35] involved the same exception, i.e. that client identity is
privileged in those instances where a strong probability exists that the disclosure of the client's
identity would implicate the client in the very criminal activity for which the lawyers legal advice
was obtained.
The Hodge case involved federal grand jury proceedings inquiring into the activities of the
Sandino Gang, a gang involved in the illegal importation of drugs in the United States. The
respondents, law partners, represented key witnesses and suspects including the leader of the
gang, Joe Sandino.
In connection with a tax investigation in November of 1973, the IRS issued summons to
Hodge and Zweig, requiring them to produce documents and information regarding payment
received by Sandino on behalf of any other person, and vice versa. The lawyers refused to
divulge the names. The Ninth Circuit of the United States Court of Appeals, upholding non-
disclosure under the facts and circumstances of the case, held:
A clients identity and the nature of that clients fee arrangements may be privileged where
the person invoking the privilege can show that a strong probability exists that disclosure of such
information would implicate that client in the very criminal activity for which legal advice was
sought Baird v. Koerner, 279 F.2d at 680. While in Baird Owe enunciated this rule as a matter of
California law, the rule also reflects federal law. Appellants contend that the Baird exception
applies to this case.
The Baird exception is entirely consonant with the principal policy behind the attorney-
client privilege.In order to promote freedom of consultation of legal advisors by clients, the
apprehension of compelled disclosure from the legal advisors must be removed; hence, the law
must prohibit such disclosure except on the clients consent. 8 J. Wigmore, supra sec. 2291, at
545. In furtherance of this policy, the clients identity and the nature of his fee arrangements are,
in exceptional cases, protected as confidential communications. [36]
2) Where disclosure would open the client to civil liability, his identity is
privileged. For instance, the peculiar facts and circumstances of Neugass v.
Terminal Cab Corporation,[37] prompted the New York Supreme Court to allow
a lawyers claim to the effect that he could not reveal the name of his client
because this would expose the latter to civil litigation.
In the said case, Neugass, the plaintiff, suffered injury when the taxicab she was riding,
owned by respondent corporation, collided with a second taxicab, whose owner was
unknown. Plaintiff brought action both against defendant corporation and the owner of the
second cab, identified in the information only as John Doe. It turned out that when the attorney
of defendant corporation appeared on preliminary examination, the fact was somehow revealed
that the lawyer came to know the name of the owner of the second cab when a man, a client of
the insurance company, prior to the institution of legal action, came to him and reported that he
was involved in a car accident. It was apparent under the circumstances that the man was the
owner of the second cab. The state supreme court held that the reports were clearly made to the
lawyer in his professional capacity. The court said:
That his employment came about through the fact that the insurance company had hired
him to defend its policyholders seems immaterial. The attorney in such cases is clearly the
attorney for the policyholder when the policyholder goes to him to report an occurrence
contemplating that it would be used in an action or claim against him. [38]
x x x xxx xxx.
All communications made by a client to his counsel, for the purpose of professional advice
or assistance, are privileged, whether they relate to a suit pending or contemplated, or to any
other matter proper for such advice or aid; x x x And whenever the communication made, relates
to a matter so connected with the employment as attorney or counsel as to afford presumption
that it was the ground of the address by the client, then it is privileged from disclosure. xxx.
It appears... that the name and address of the owner of the second cab came to the
attorney in this case as a confidential communication. His client is not seeking to use the courts,
and his address cannot be disclosed on that theory, nor is the present action pending against
him as service of the summons on him has not been effected. The objections on which the court
reserved decision are sustained.[39]
In the case of Matter of Shawmut Mining Company,[40] the lawyer involved was required by
a lower court to disclose whether he represented certain clients in a certain transaction. The
purpose of the courts request was to determine whether the unnamed persons as interested
parties were connected with the purchase of properties involved in the action. The lawyer
refused and brought the question to the State Supreme Court. Upholding the lawyers refusal to
divulge the names of his clients the court held:
If it can compel the witness to state, as directed by the order appealed from, that he
represented certain persons in the purchase or sale of these mines, it has made progress in
establishing by such evidence their version of the litigation. As already suggested, such
testimony by the witness would compel him to disclose not only that he was attorney for certain
people, but that, as the result of communications made to him in the course of such employment
as such attorney, he knew that they were interested in certain transactions. We feel sure that
under such conditions no case has ever gone to the length of compelling an attorney, at the
instance of a hostile litigant, to disclose not only his retainer, but the nature of the transactions to
which it related, when such information could be made the basis of a suit against his client.[41]
3) Where the governments lawyers have no case against an attorneys client unless, by
revealing the clients name, the said name would furnish the only link that would form the chain of
testimony necessary to convict an individual of a crime, the clients name is privileged.
In Baird vs Korner,[42] a lawyer was consulted by the accountants and the lawyer of certain
undisclosed taxpayers regarding steps to be taken to place the undisclosed taxpayers in a
favorable position in case criminal charges were brought against them by the U.S. Internal
Revenue Service (IRS).
It appeared that the taxpayers returns of previous years were probably incorrect and the
taxes understated. The clients themselves were unsure about whether or not they violated tax
laws and sought advice from Baird on the hypothetical possibility that they had. No investigation
was then being undertaken by the IRS of the taxpayers. Subsequently, the attorney of the
taxpayers delivered to Baird the sum of $12,706.85, which had been previously assessed as the
tax due, and another amount of money representing his fee for the advice given. Baird then sent
a check for $12,706.85 to the IRS in Baltimore, Maryland, with a note explaining the payment,
but without naming his clients. The IRS demanded that Baird identify the lawyers, accountants,
and other clients involved. Baird refused on the ground that he did not know their names, and
declined to name the attorney and accountants because this constituted privileged
communication. A petition was filed for the enforcement of the IRS summons. For Bairds
repeated refusal to name his clients he was found guilty of civil contempt. The Ninth Circuit
Court of Appeals held that, a lawyer could not be forced to reveal the names of clients who
employed him to pay sums of money to the government voluntarily in settlement of
undetermined income taxes, unsued on, and with no government audit or investigation into that
clients income tax liability pending. The court emphasized the exception that a clients name is
privileged when so much has been revealed concerning the legal services rendered that the
disclosure of the clients identity exposes him to possible investigation and sanction by
government agencies. The Court held:
The facts of the instant case bring it squarely within that exception to the general
rule. Here money was received by the government, paid by persons who thereby admitted they
had not paid a sufficient amount in income taxes some one or more years in the past. The
names of the clients are useful to the government for but one purpose - to ascertain which
taxpayers think they were delinquent, so that it may check the records for that one year or
several years. The voluntary nature of the payment indicates a belief by the taxpayers that more
taxes or interest or penalties are due than the sum previously paid, if any. It indicates a feeling of
guilt for nonpayment of taxes, though whether it is criminal guilt is undisclosed. But it may well
be the link that could form the chain of testimony necessary to convict an individual of a federal
crime. Certainly the payment and the feeling of guilt are the reasons the attorney here involved
was employed - to advise his clients what, under the circumstances, should be done.[43]
Apart from these principal exceptions, there exist other situations which could qualify as
exceptions to the general rule.
For example, the content of any client communication to a lawyer lies within the privilege if
it is relevant to the subject matter of the legal problem on which the client seeks legal
assistance.[44] Moreover, where the nature of the attorney-client relationship has been previously
disclosed and it is the identitywhich is intended to be confidential, the identity of the client has
been held to be privileged, since such revelation would otherwise result in disclosure of the
entire transaction.[45]
Summarizing these exceptions, information relating to the identity of a client may fall within
the ambit of the privilege when the clients name itself has an independent significance, such that
disclosure would then reveal client confidences.[46]
The circumstances involving the engagement of lawyers in the case at bench, therefore,
clearly reveal that the instant case falls under at least two exceptions to the general rule. First,
disclosure of the alleged client's name would lead to establish said client's connection with the
very fact in issue of the case, which is privileged information, because the privilege, as stated
earlier, protects the subject matter or the substance (without which there would be no attorney-
client relationship).
The link between the alleged criminal offense and the legal advice or legal service sought
was duly established in the case at bar, by no less than the PCGG itself. The key lies in the
three specific conditions laid down by the PCGG which constitutes petitioners ticket to non-
prosecution should they accede thereto:
(a) the disclosure of the identity of its clients;
(b) submission of documents substantiating the lawyer-client relationship; and
(c) the submission of the deeds of assignment petitioners executed in favor of their clients
covering their respective shareholdings.
From these conditions, particularly the third, we can readily deduce that the clients indeed
consulted the petitioners, in their capacity as lawyers, regarding the financial and corporate
structure, framework and set-up of the corporations in question. In turn, petitioners gave their
professional advice in the form of, among others, the aforementioned deeds of assignment
covering their clients shareholdings.
There is no question that the preparation of the aforestated documents was part and
parcel of petitioners legal service to their clients. More important, it constituted an integral part of
their duties as lawyers. Petitioners, therefore, have a legitimate fear that identifying their clients
would implicate them in the very activity for which legal advice had been sought, i.e., the alleged
accumulation of ill-gotten wealth in the aforementioned corporations.
Furthermore, under the third main exception, revelation of the client's name would
obviously provide the necessary link for the prosecution to build its case, where none otherwise
exists. It is the link, in the words of Baird, that would inevitably form the chain of testimony
necessary to convict the (client) of a... crime."[47]
An important distinction must be made between a case where a client takes on the
services of an attorney for illicit purposes, seeking advice about how to go around the law for the
purpose of committing illegal activities and a case where a client thinks he might have previously
committed something illegal and consults his attorney about it. The first case clearly does not fall
within the privilege because the same cannot be invoked for purposes illegal. The second case
falls within the exception because whether or not the act for which the advice turns out to be
illegal, his name cannot be used or disclosed if the disclosure leads to evidence, not yet in the
hands of the prosecution, which might lead to possible action against him.
These cases may be readily distinguished, because the privilege cannot be invoked or
used as a shield for an illegal act, as in the first example; while the prosecution may not have a
case against the client in the second example and cannot use the attorney client relationship to
build up a case against the latter. The reason for the first rule is that it is not within the
professional character of a lawyer to give advice on the commission of a crime.[48] The reason for
the second has been stated in the cases above discussed and are founded on the same policy
grounds for which the attorney-client privilege, in general, exists.
In Matter of Shawmut Mining Co., supra, the appellate court therein stated that "under
such conditions no case has ever yet gone to the length of compelling an attorney, at the
instance of a hostile litigant, to disclose not only his retainer, but the nature of the transactions to
which it related, when such information could be made the basis of a suit against his
client.[49] "Communications made to an attorney in the course of any personal employment,
relating to the subject thereof, and which may be supposed to be drawn out in consequence
of the relation in which the parties stand to each other, are under the seal of confidence and
entitled to protection as privileged communications."[50] Where the communicated information,
which clearly falls within the privilege, would suggest possible criminal activity but there would be
not much in the information known to the prosecution which would sustain a charge except that
revealing the name of the client would open up other privileged information which would
substantiate the prosecutions suspicions, then the clients identity is so inextricably linked to the
subject matter itself that it falls within the protection. The Baird exception, applicable to the
instant case, is consonant with the principal policy behind the privilege, i.e., that for the purpose
of promoting freedom of consultation of legal advisors by clients, apprehension of compelled
disclosure from attorneys must be eliminated. This exception has likewise been sustained in In
re Grand Jury Proceedings[51] and Tillotson v. Boughner.[52]What these cases unanimously seek
to avoid is the exploitation of the general rule in what may amount to a fishing expedition by the
prosecution.
There are, after all, alternative sources of information available to the prosecutor which do
not depend on utilizing a defendant's counsel as a convenient and readily available source of
information in the building of a case against the latter. Compelling disclosure of the client's name
in circumstances such as the one which exists in the case at bench amounts to sanctioning
fishing expeditions by lazy prosecutors and litigants which we cannot and will not
countenance. When the nature of the transaction would be revealed by disclosure of an
attorney's retainer, such retainer is obviously protected by the privilege. [53] It follows that
petitioner attorneys in the instant case owe their client(s) a duty and an obligation not to disclose
the latter's identity which in turn requires them to invoke the privilege.
 In fine, the crux of petitioners' objections ultimately hinges on their expectation that if the
prosecution has a case against their clients, the latter's case should be built upon evidence
painstakingly gathered by them from their own sources and not from compelled testimony
requiring them to reveal the name of their clients, information which unavoidably reveals much
about the nature of the transaction which may or may not be illegal. The logical nexus between
name and nature of transaction is so intimate in this case that it would be difficult to simply
dissociate one from the other. In this sense, the name is as much "communication" as
information revealed directly about the transaction in question itself, a communication which is
clearly and distinctly privileged. A lawyer cannot reveal such communication without exposing
himself to charges of violating a principle which forms the bulwark of the entire attorney-client
relationship.
The uberrimei fidei relationship between a lawyer and his client therefore imposes a strict
liability for negligence on the former. The ethical duties owing to the client, including
confidentiality, loyalty, competence, diligence as well as the responsibility to keep clients
informed and protect their rights to make decisions have been zealously sustained. In Milbank,
Tweed, Hadley and McCloy v. Boon,[54] the US Second District Court rejected the plea of the
petitioner law firm that it breached its fiduciary duty to its client by helping the latter's former
agent in closing a deal for the agent's benefit only after its client hesitated in proceeding with the
transaction, thus causing no harm to its client. The Court instead ruled that breaches of a
fiduciary relationship in any context comprise a special breed of cases that often loosen normally
stringent requirements of causation and damages, and found in favor of the client.
To the same effect is the ruling in Searcy, Denney, Scarola, Barnhart, and Shipley P.A. v.
Scheller[55]requiring strict obligation of lawyers vis-a-vis clients. In this case, a contingent fee
lawyer was fired shortly before the end of completion of his work, and sought payment quantum
meruit of work done. The court, however, found that the lawyer was fired for cause after he
sought to pressure his client into signing a new fee agreement while settlement negotiations
were at a critical stage. While the client found a new lawyer during the interregnum, events
forced the client to settle for less than what was originally offered.Reiterating the principle of
fiduciary duty of lawyers to clients in Meinhard v. Salmon[56] famously attributed to Justice
Benjamin Cardozo that "Not honesty alone, but the punctilio of an honor the most sensitive, is
then the standard of behavior," the US Court found that the lawyer involved was fired for cause,
thus deserved no attorney's fees at all.
The utmost zeal given by Courts to the protection of the lawyer-client confidentiality
privilege and lawyer's loyalty to his client is evident in the duration of the protection, which exists
not only during the relationship, but extends even after the termination of the relationship. [57]
Such are the unrelenting duties required of lawyers vis-a-vis their clients because the law,
which the lawyers are sworn to uphold, in the words of Oliver Wendell Holmes,[58] "xxx is an
exacting goddess, demanding of her votaries in intellectual and moral discipline." The Court, no
less, is not prepared to accept respondents position without denigrating the noble profession that
is lawyering, so extolled by Justice Holmes in this wise:
Every calling is great when greatly pursued. But what other gives such scope to realize the
spontaneous energy of one's soul? In what other does one plunge so deep in the stream of life -
so share its passions its battles, its despair, its triumphs, both as witness and actor? x x x But
that is not all. What a subject is this in which we are united - this abstraction called the Law,
wherein as in a magic mirror, we see reflected, not only in our lives, but the lives of all men that
have been. When I think on this majestic theme my eyes dazzle. If we are to speak of the law as
our mistress, we who are here know that she is a mistress only to be won with sustained and
lonely passion - only to be won by straining all the faculties by which man is likened to God.
We have no choice but to uphold petitioners' right not to reveal the identity of their clients
under pain of the breach of fiduciary duty owing to their clients, because the facts of the instant
case clearly fall within recognized exceptions to the rule that the clients name is not privileged
information.
If we were to sustain respondent PCGG that the lawyer-client confidential privilege under
the circumstances obtaining here does not cover the identity of the client, then it would expose
the lawyers themselves to possible litigation by their clients in view of the strict fiduciary
responsibility imposed on them in the exercise of their duties.
The complaint in Civil Case No. 0033 alleged that the defendants therein, including herein
petitioners and Eduardo Cojuangco, Jr. conspired with each other in setting up through the use
of coconut levy funds the financial and corporate framework and structures that led to the
establishment of UCPB, UNICOM and others and that through insidious means and
machinations, ACCRA, using its wholly-owned investment arm, ACCRA Investments
Corporation, became the holder of approximately fifteen million shares representing roughly
3.3% of the total capital stock of UCPB as of 31 March 1987. The PCGG wanted to establish
through the ACCRA lawyers that Mr. Cojuangco is their client and it was Cojuangco who
furnished all the monies to the subscription payment; hence, petitioners acted as dummies,
nominees and/or agents by allowing themselves, among others, to be used as instrument in
accumulating ill-gotten wealth through government concessions, etc., which acts constitute
gross abuse of official position and authority, flagrant breach of public trust, unjust enrichment,
violation of the Constitution and laws of the Republic of the Philippines.
By compelling petitioners, not only to reveal the identity of their clients, but worse, to
submit to the PCGG documents substantiating the client-lawyer relationship, as well as deeds of
assignment petitioners executed in favor of its clients covering their respective shareholdings,
the PCGG would exact from petitioners a link that would inevitably form the chain of testimony
necessary to convict the (client) of a crime.
III
In response to petitioners' last assignment of error, respondents allege that the private
respondent was dropped as party defendant not only because of his admission that he acted
merely as a nominee but also because of his undertaking to testify to such facts and
circumstances "as the interest of truth may require, which includes... the identity of the
principal."[59]
First, as to the bare statement that private respondent merely acted as a lawyer and
nominee, a statement made in his out-of-court settlement with the PCGG, it is sufficient to state
that petitioners have likewise made the same claim not merely out-of- court but also in their
Answer to plaintiff's Expanded Amended Complaint, signed by counsel, claiming that their acts
were made in furtherance of "legitimate lawyering.[60] Being "similarly situated" in this regard,
public respondents must show that there exist other conditions and circumstances which would
warrant their treating the private respondent differently from petitioners in the case at bench in
order to evade a violation of the equal protection clause of the Constitution.
To this end, public respondents contend that the primary consideration behind their
decision to sustain the PCGG's dropping of private respondent as a defendant was his promise
to disclose the identities of the clients in question. However, respondents failed to show - and
absolutely nothing exists in the records of the case at bar - that private respondent actually
revealed the identity of his client(s) to the PCGG.Since the undertaking happens to be the
leitmotif of the entire arrangement between Mr. Roco and the PCGG, an undertaking which is so
material as to have justified PCGG's special treatment exempting the private respondent from
prosecution, respondent Sandiganbayan should have required proof of the undertaking more
substantial than a "bare assertion" that private respondent did indeed comply with the
undertaking. Instead, as manifested by the PCGG, only three documents were submitted for the
purpose, two of which were mere requests for re-investigation and one simply disclosed certain
clients which petitioners (ACCRA lawyers) were themselves willing to reveal. These were clients
to whom both petitioners and private respondent rendered legal services while all of them were
partners at ACCRA, and were not the clients which the PCGG wanted disclosed for the alleged
questioned transactions.[61]
To justify the dropping of the private respondent from the case or the filing of the suit in the
respondent court without him, therefore, the PCGG should conclusively show that Mr. Roco was
treated as a species apart from the rest of the ACCRA lawyers on the basis of a classification SO ORDERED.
which made substantial distinctions based on real differences. No such substantial distinctions
exist from the records of the case at bench, in violation of the equal protection clause.
G.R. No. L-961 September 21, 1949
The equal protection clause is a guarantee which provides a wall of protection against
uneven application of statutes and regulations. In the broader sense, the guarantee operates
BLANDINA GAMBOA HILADO, petitioner,
against uneven application of legal norms so that all persons under similar circumstances would
vs.
be accorded the same treatment.[62] Those who fall within a particular class ought to be treated
JOSE GUTIERREZ DAVID, VICENTE J. FRANCISCO, JACOB ASSAD and SELIM JACOB
alike not only as to privileges granted but also as to the liabilities imposed.
ASSAD, respondents.

x x x. What is required under this constitutional guarantee is the uniform operation of legal norms
so that all persons under similar circumstances would be accorded the same treatment both in
the privileges conferred and the liabilities imposed. As was noted in a recent decision: Favoritism
and undue preference cannot be allowed. For the principle is that equal protection and security
shall be given to every person under circumstances, which if not identical are analogous. If law
be looked upon in terms of burden or charges, those that fall within a class should be treated in
the same fashion, whatever restrictions cast on some in the group equally binding the rest. [63]
We find that the condition precedent required by the respondent PCGG of the petitioners
for their exclusion as parties-defendants in PCGG Case No. 33 violates the lawyer-client
confidentiality privilege.The condition also constitutes a transgression by respondents
Sandiganbayan and PCGG of the equal protection clause of the Constitution.[64] It is grossly
unfair to exempt one similarly situated litigant from prosecution without allowing the same
exemption to the others. Moreover, the PCGGs demand not only touches upon the question of
the identity of their clients but also on documents related to the suspected transactions, not only
in violation of the attorney-client privilege but also of the constitutional right against self-
incrimination. Whichever way one looks at it, this is a fishing expedition, a free ride at the
expense of such rights.
An argument is advanced that the invocation by petitioners of the privilege of attorney-
client confidentiality at this stage of the proceedings is premature and that they should wait until
they are called to testify and examine as witnesses as to matters learned in confidence before
they can raise their objections. But petitioners are not mere witnesses. They are co-principals in
the case for recovery of alleged ill-gotten wealth. They have made their position clear from the
very beginning that they are not willing to testify and they cannot be compelled to testify in view
of their constitutional right against self-incrimination and of their fundamental legal right to
maintain inviolate the privilege of attorney-client confidentiality.
Delgado, Dizon and Flores for petitioner.
Vicente J. Francisco for respondents.
TUASON, J.:
It appears that on April 23, 1945, Blandina Gamboa Hilado brought an action against Selim
Jacob Assad to annul the sale of several houses and lot executed during the Japanese
occupation by Mrs. Hilado's now deceased husband.
On May 14, Attorneys Ohnick, Velilla and Balonkita filed an answer on behalf of the defendant;
and on June 15, Attorneys Delgado, Dizon, Flores and Rodrigo registered their appearance as
counsel for the plaintiff. On October 5, these attorneys filed an amended complaint by including
Jacob Assad as party defendant.
On January 28, 1946, Attorney Francisco entered his appearance as attorney of record for the
defendant in substitution for Attorney Ohnick, Velilla and Balonkita who had withdrawn from the
case.
On May 29, Attorney Dizon, in the name of his firm, wrote Attorney Francisco urging him to
discontinue representing the defendants on the ground that their client had consulted with him
about her case, on which occasion, it was alleged, "she turned over the papers" to Attorney
Francisco, and the latter sent her a written opinion. Not receiving any answer to this suggestion,
Attorney Delgado, Dizon, Flores and Rodrigo on June 3, 1946, filed a formal motion with the
court, wherein the case was and is pending, to disqualify Attorney Francisco.

It is clear then that the case against petitioners should never be allowed to take its full
course in the Sandiganbayan. Petitioners should not be made to suffer the effects of further Attorney Francisco's letter to plaintiff, mentioned above and identified as Exhibit A, is in full as
litigation when it is obvious that their inclusion in the complaint arose from a privileged attorney- follows:
client relationship and as a means of coercing them to disclose the identities of their clients. To
allow the case to continue with respect to them when this Court could nip the problem in the bud VICENTE J. FRANCISCO
at this early opportunity would be to sanction an unjust situation which we should not here Attorney-at-Law
countenance. The case hangs as a real and palpable threat, a proverbial Sword of Damocles 1462 Estrada, Manila
over petitioners' heads. It should not be allowed to continue a day longer.

While we are aware of respondent PCGGs legal mandate to recover ill-gotten wealth, we July 13, 1945.
will not sanction acts which violate the equal protection guarantee and the right against self-
incrimination and subvert the lawyer-client confidentiality privilege.

WHEREFORE, IN VIEW OF THE FOREGOING, the Resolutions of respondent

Mrs. Blandina Gamboa Hilado
Sandiganbayan (First Division) promulgated on March 18, 1992 and May 21, 1992 are hereby Manila, Philippines
ANNULLED and SET ASIDE.Respondent Sandiganbayan is further ordered to exclude
petitioners Teodoro D. Regala, Edgardo J. Angara, Avelino V. Cruz, Jose C.
Concepcion, *Rogelio A. Vinluan, Victor P. Lazatin, Eduardo U. Escueta and Paraja G. Hayuduni My dear Mrs. Hilado:
as parties-defendants in SB Civil Case No. 0033 entitled "Republic of the Philippines v. Eduardo
Cojuangco, Jr., et al.".
 From the papers you submitted to me in connection with civil case No. 70075 of the
Court of First Instance of Manila, entitled "Blandina Gamboa Hilado vs. S. J. Assad," I
find that the basic facts which brought about the controversy between you and the
defendant therein are as follows:
(a) That you were the equitable owner of the property described in the complaint, as
the same was purchased and/or built with funds exclusively belonging to you, that is to
say, the houses and lot pertained to your paraphernal estate;
(b) That on May 3, 1943, the legal title to the property was with your husband, Mr.
Serafin P. Hilado; and
(c) That the property was sold by Mr. Hilado without your knowledge on the aforesaid
date of May 3, 1943.
Upon the foregoing facts, I am of the opinion that your action against Mr. Assad will
not ordinarily prosper. Mr. Assad had the right to presume that your husband had the
legal right to dispose of the property as the transfer certificate of title was in his name.
Moreover, the price of P110,000 in Japanese military notes, as of May 3, 1943, does
not quite strike me as so grossly inadequate as to warrant the annulment of the sale. I
believe, lastly, that the transaction cannot be avoided merely because it was made
during the Japanese occupation, nor on the simple allegation that the real purchaser
was not a citizen of the Philippines. On his last point, furthermore, I expect that you
will have great difficulty in proving that the real purchaser was other than Mr. Assad,
considering that death has already sealed your husband's lips and he cannot now
testify as to the circumstances of the sale.
For the foregoing reasons, I regret to advise you that I cannot appear in the
proceedings in your behalf. The records of the case you loaned to me are herewith
returned.
Yours very truly,
(Sgd.) VICENTE J. FRANCISCO
VJF/Rag.
In his answer to plaintiff's attorneys' complaint, Attorney Francisco alleged that about May, 1945,
a real estate broker came to his office in connection with the legal separation of a woman who
had been deserted by her husband, and also told him (Francisco) that there was a pending suit
brought by Mrs. Hilado against a certain Syrian to annul the sale of a real estate which the
deceased Serafin Hilado had made to the Syrian during the Japanese occupation; that this
woman asked him if he was willing to accept the case if the Syrian should give it to him; that he
told the woman that the sales of real property during the Japanese regime were valid even
though it was paid for in Japanese military notes; that this being his opinion, he told his visitor he
would have no objection to defending the Syrian;
That one month afterwards, Mrs. Hilado came to see him about a suit she had instituted against
a certain Syrian to annul the conveyance of a real estate which her husband had made; that
according to her the case was in the hands of Attorneys Delgado and Dizon, but she wanted to
take it away from them; that as he had known the plaintiff's deceased husband he did not
hesitate to tell her frankly that hers was a lost case for the same reason he had told the broker;
that Mrs. Hilado retorted that the basis of her action was not that the money paid her husband
was Japanese military notes, but that the premises were her private and exclusive property; that
she requested him to read the complaint to be convinced that this was the theory of her suit; that
he then asked Mrs. Hilado if there was a Torrens title to the property and she answered yes, in
the name of her husband; that he told Mrs. Hilado that if the property was registered in her
husband's favor, her case would not prosper either;
That some days afterward, upon arrival at his law office on Estrada street, he was informed by
Attorney Federico Agrava, his assistant, that Mrs. Hilado had dropped in looking for him and that
when he, Agrava, learned that Mrs. Hilado's visit concerned legal matters he attended to her and
requested her to leave the "expediente" which she was carrying, and she did; that he told
Attorney Agrava that the firm should not handle Mrs. Hilado's case and he should return the
papers, calling Agrava's attention to what he (Francisco) already had said to Mrs. Hilado;
That several days later, the stenographer in his law office, Teofilo Ragodon, showed him a letter
which had been dictated in English by Mr. Agrava, returning the "expedients" to Mrs. Hilado; that
Ragodon told him (Attorney Francisco) upon Attorney Agrava's request that Agrava thought it
more proper to explain to Mrs. Hilado the reasons why her case was rejected; that he forthwith
signed the letter without reading it and without keeping it for a minute in his possession; that he
never saw Mrs. Hilado since their last meeting until she talked to him at the Manila Hotel about a
proposed extrajudicial settlement of the case;
That in January, 1946, Assad was in his office to request him to handle his case stating that his
American lawyer had gone to the States and left the case in the hands of other attorneys; that he
accepted the retainer and on January 28, 1946, entered his appearance.
Attorney Francisco filed an affidavit of stenographer Ragodon in corroboration of his answer.
The judge trying the case, Honorable Jose Gutierrez David, later promoted to the Court of
Appeals, dismissed the complaint. His Honor believed that no information other than that already
alleged in plaintiff's complaint in the main cause was conveyed to Attorney Francisco, and
concluded that the intercourse between the plaintiff and the respondent did not attain the point of
creating the relation of attorney and client.
Stripped of disputed details and collateral matters, this much is undoubted: That Attorney
Francisco's law firm mailed to the plaintiff a written opinion over his signature on the merits of
her case; that this opinion was reached on the basis of papers she had submitted at his office;
that Mrs. Hilado's purpose in submitting those papers was to secure Attorney Francisco's
professional services. Granting the facts to be no more than these, we agree with petitioner's
counsel that the relation of attorney and client between Attorney Francisco and Mrs. Hilado
ensued. The following rules accord with the ethics of the legal profession and meet with our
approval:
In order to constitute the relation (of attorney and client) a professional one and not
merely one of principal and agent, the attorneys must be employed either to give
advice upon a legal point, to prosecute or defend an action in court of justice, or to
prepare and draft, in legal form such papers as deeds, bills, contracts and the like.
(Atkinson vs. Howlett, 11 Ky. Law Rep. (abstract), 364; cited in Vol. 88, A. L. R., p. 6.)
To constitute professional employment it is not essential that the client should have
employed the attorney professionally on any previous occasion. . . . It is not necessary
that any retainer should have been paid, promised, or charged for; neither is it material
that the attorney consulted did not afterward undertake the case about which the
consultation was had. If a person, in respect to his business affairs or troubles of any
 kind, consults with his attorney in his professional capacity with the view to obtaining
professional advice or assistance, and the attorney voluntarily permits or acquiesces
in such consultation, then the professional employment must be regarded as
established. . . . (5 Jones Commentaries on Evidence, pp. 4118-4119.)
An attorney is employed-that is, he is engaged in his professional capacity as a lawyer
or counselor-when he is listening to his client's preliminary statement of his case, or
when he is giving advice thereon, just as truly as when he is drawing his client's
pleadings, or advocating his client's cause in open court. (Denver Tramway Co. vs.
Owens, 20 Colo., 107; 36 P., 848.)
Formality is not an essential element of the employment of an attorney. The contract
may be express or implied and it is sufficient that the advice and assistance of the
attorney is sought and received, in matters pertinent to his profession. An acceptance
of the relation is implied on the part of the attorney from his acting in behalf of his
client in pursuance of a request by the latter. (7 C. J. S., 848-849; see Hirach Bros.
and Co. vs. R. E. Kennington Co., 88 A. L. R., 1.)
Section 26 (e), Rule 123 of the Rules of Court provides that "an attorney cannot, without the
consent of his client, be examined as to any communication made by the client to him, or his
advice given thereon in the course of professional employment;" and section 19 (e) of Rule 127
imposes upon an attorney the duty "to maintain inviolate the confidence, and at every peril to
himself, to preserve the secrets of his client." There is no law or provision in the Rules of Court
prohibiting attorneys in express terms from acting on behalf of both parties to a controversy
whose interests are opposed to each other, but such prohibition is necessarily implied in the
injunctions above quoted. (In re De la Rosa, 27 Phil., 258.) In fact the prohibition derives validity
from sources higher than written laws and rules. As has been aptly said in In re Merron, 22 N.
M., 252, L.R.A., 1917B, 378, "information so received is sacred to the employment to which it
pertains," and "to permit it to be used in the interest of another, or, worse still, in the interest of
the adverse party, is to strike at the element of confidence which lies at the basis of, and affords
the essential security in, the relation of attorney and client."
That only copies of pleadings already filed in court were furnished to Attorney Agrava and that,
this being so, no secret communication was transmitted to him by the plaintiff, would not vary the
situation even if we should discard Mrs. Hilado's statement that other papers, personal and
private in character, were turned in by her. Precedents are at hand to support the doctrine that
the mere relation of attorney and client ought to preclude the attorney from accepting the
opposite party's retainer in the same litigation regardless of what information was received by
him from his first client.
The principle which forbids an attorney who has been engaged to represent a client
from thereafter appearing on behalf of the client's opponent applies equally even
though during the continuance of the employment nothing of a confidential nature was
revealed to the attorney by the client. (Christian vs. Waialua Agricultural Co., 30
Hawaii, 553, Footnote 7, C. J. S., 828.)
Where it appeared that an attorney, representing one party in litigation, had formerly
represented the adverse party with respect to the same matter involved in the
litigation, the court need not inquire as to how much knowledge the attorney acquired
from his former during that relationship, before refusing to permit the attorney to
represent the adverse party. (Brown vs. Miller, 52 App. D. C. 330; 286, F. 994.)
In order that a court may prevent an attorney from appearing against a former client, it
is unnecessary that the ascertain in detail the extent to which the former client's affairs
might have a bearing on the matters involved in the subsequent litigation on the
attorney's knowledge thereof. (Boyd vs. Second Judicial Dist. Court, 274 P., 7; 51
Nev., 264.)
This rule has been so strictly that it has been held an attorney, on terminating his
employment, cannot thereafter act as counsel against his client in the same general
matter, even though, while acting for his former client, he acquired no knowledge
which could operate to his client's disadvantage in the subsequent adverse
employment. (Pierce vs. Palmer [1910], 31 R. I., 432; 77 Atl., 201, Ann. Cas., 1912S,
181.)
Communications between attorney and client are, in a great number of litigations, a complicated
affair, consisting of entangled relevant and irrelevant, secret and well known facts. In the
complexity of what is said in the course of the dealings between an attorney and a client, inquiry
of the nature suggested would lead to the revelation, in advance of the trial, of other matters that
might only further prejudice the complainant's cause. And the theory would be productive of
other un salutary results. To make the passing of confidential communication a condition
precedent; i.e., to make the employment conditioned on the scope and character of the
knowledge acquired by an attorney in determining his right to change sides, would not enhance
the freedom of litigants, which is to be sedulously fostered, to consult with lawyers upon what
they believe are their rights in litigation. The condition would of necessity call for an investigation
of what information the attorney has received and in what way it is or it is not in conflict with his
new position. Litigants would in consequence be wary in going to an attorney, lest by an
unfortunate turn of the proceedings, if an investigation be held, the court should accept the
attorney's inaccurate version of the facts that came to him. "Now the abstinence from seeking
legal advice in a good cause is by hypothesis an evil which is fatal to the administration of
justice." (John H. Wigmore's Evidence, 1923, Section 2285, 2290, 2291.)
Hence the necessity of setting down the existence of the bare relationship of attorney and client
as the yardstick for testing incompatibility of interests. This stern rule is designed not alone to
prevent the dishonest practitioner from fraudulent conduct, but as well to protect the honest
lawyer from unfounded suspicion of unprofessional practice. (Strong vs. Int. Bldg., etc.; Ass'n,
183 Ill., 97; 47 L.R.A., 792.) It is founded on principles of public policy, on good taste. As has
been said in another case, the question is not necessarily one of the rights of the parties, but as
to whether the attorney has adhered to proper professional standard. With these thoughts in
mind, it behooves attorneys, like Caesar's wife, not only to keep inviolate the client's confidence,
but also to avoid the appearance of treachery and double-dealing. Only thus can litigants be
encouraged to entrust their secrets to their attorneys which is of paramount importance in the
administration of justice.
So without impugning respondent's good faith, we nevertheless can not sanction his taking up
the cause of the adversary of the party who had sought and obtained legal advice from his firm;
this, not necessarily to prevent any injustice to the plaintiff but to keep above reproach the honor
and integrity of the courts and of the bar. Without condemning the respondents conduct as
dishonest, corrupt, or fraudulent, we do believe that upon the admitted facts it is highly in
expedient. It had the tendency to bring the profession, of which he is a distinguished member,
"into public disrepute and suspicion and undermine the integrity of justice."
There is in legal practice what called "retaining fee," the purpose of which stems from the
realization that the attorney is disabled from acting as counsel for the other side after he has
given professional advice to the opposite party, even if he should decline to perform the
contemplated services on behalf of the latter. It is to prevent undue hardship on the attorney
resulting from the rigid observance of the rule that a separate and independent fee for
consultation and advice was conceived and authorized. "A retaining fee is a preliminary fee
given to an attorney or counsel to insure and secure his future services, and induce him to act
for the client. It is intended to remunerate counsel for being deprived, by being retained by one
party, of the opportunity of rendering services to the other and of receiving pay from him, and the
payment of such fee, in the absence of an express understanding to the contrary, is neither
made nor received in payment of the services contemplated; its payment has no relation to the
obligation of the client to pay his attorney for the services which he has retained him to perform."
(7 C.J.S., 1019.)
The defense that Attorney Agrava wrote the letter Exhibit A and that Attorney Francisco did not
take the trouble of reading it, would not take the case out of the interdiction. If this letter was
written under the circumstances explained by Attorney Francisco and he was unaware of its
contents, the fact remains that his firm did give Mrs. Hilado a formal professional advice from
which, as heretofore demonstrated, emerged the relation of attorney and client. This letter binds
and estop him in the same manner and to the same degree as if he personally had written it. An
information obtained from a client by a member or assistant of a law firm is information imparted
to the firm. (6 C. J., 628; 7 C. J. S., 986.) This is not a mere fiction or an arbitrary rule; for such
member or assistant, as in our case, not only acts in the name and interest of the firm, but his
information, by the nature of his connection with the firm is available to his associates or
employers. The rule is all the more to be adhered to where, as in the present instance, the
opinion was actually signed by the head of the firm and carries his initials intended to convey the
impression that it was dictated by him personally. No progress could be hoped for in "the public
policy that the client in consulting his legal adviser ought to be free from apprehension of
disclosure of his confidence," if the prohibition were not extended to the attorney's partners,
employers or assistants.
FERNANDO SALONGA, complainant, vs. ATTY. ISIDRO T. HILDAWA, respondent.
DECISION
VITUG, J.:
In an affidavit-complaint, dated 29 March 1996, Fernando Salonga, President of Sikap at
Tiyaga Alabang Vendors Association, Inc. (STAVA), of Muntinlupa City, charged Atty. Isidro T.
Hildawa with gross misconduct and/or deceit. Complainant averred that respondent lawyer was
a retained counsel of STAVA for a number of years and, in December 1993, represented the
association in Civil Cases No. 2406, No. 2413 and No. 2416, for ejectment against, respectively
, Linda Del Rosario, Angelita Manuel and Francisco Vega, all stallholders at the Alabang market,
before the Municipal Trial Court of Muntinlupa. The defendants deposited the accrued rentals
with the court.On 14 November 1994, respondent lawyer filed a motion to withdraw the deposit;
thus:
JOINT MOTION TO WITHDRAW DEPOSIT
Counsel for complainant, unto this Honorable Court, most respectfully manifest:

1. That, defendants-appellants Linda del Rosario, Angelita Manuel and Francisco

The fact that petitioner did not object until after four months had passed from the date Attorney Vega made their deposit of accrued rentals on their stalls up to October 15,
Francisco first appeared for the defendants does not operate as a waiver of her right to ask for
1994, as follows:
his disqualification. In one case, objection to the appearance of an attorney was allowed even on
appeal as a ground for reversal of the judgment. In that case, in which throughout the conduct of
the cause in the court below the attorney had been suffered so to act without objection, the court a. Linda del Rosario -- P24,440.60
said: "We are all of the one mind, that the right of the appellee to make his objection has not
lapsed by reason of failure to make it sooner; that professional confidence once reposed can
b. Angelita Manuel -- 46,436.60
never be divested by expiration of professional employment." (Nickels vs. Griffin, 1 Wash. Terr.,
374, 321 A. L. R. 1316.)
c. Francisco Vega -- 33,666.60
The complaint that petitioner's remedy is by appeal and not by certiorari deserves scant
attention. The courts have summary jurisdiction to protect the rights of the parties and the public Total -- P104,543.80
from any conduct of attorneys prejudicial to the administration of the justice. The summary
jurisdiction of the courts over attorneys is not confined to requiring them to pay over money
2. That, plaintiff is entitled to such deposits made by the appellants in order to pay
collected by them but embraces authority to compel them to do whatever specific acts may be
its obligation with the cooperative which granted the concession to the transient
incumbent upon them in their capacity of attorneys to perform. The courts from the general
area for the plaintiff to operate;
principles of equity and policy, will always look into the dealings between attorneys and clients
and guard the latter from any undue consequences resulting from a situation in which they may 3. That, counsel for the appellants register no objection to such withdrawal as shown
stand unequal. The courts acts on the same principles whether the undertaking is to appear, or, by his conformity to the herein motion.
for that matter, not to appear, to answer declaration, etc. (6 C.J., 718 C.J.S., 1005.) This
summary remedy against attorneys flows from the facts that they are officers of the court where
they practice, forming a part of the machinery of the law for the administration of justice and as Wherefore, it is prayed of this Honorable Court that plaintiff be authorized to withdraw the
such subject to the disciplinary authority of the courts and to its orders and directions with corresponding amounts deposited by the defendants in the above-entitled cases.
respect to their relations to the court as well as to their clients. (Charest vs. Bishop, 137 Minn.,
102; 162, N.W., 1062, Note 26, 7 C. J. S., 1007.) Attorney stand on the same footing as sheriffs RESPECTFULLY SUBMITTED.
and other court officers in respect of matters just mentioned.

November 14, 1994.

We conclude therefore that the motion for disqualification should be allowed. It is so ordered,
without costs.
MAKATI for Muntinlupa.

HILDAWA & GOMEZ

[A.C. No. 5105. August 12, 1999]

#3484 Gen. Lucban St., cor. South already been forwarded to this Court. Respondent submitted to the Court a memorandum, dated
05 August 1998, asseverating that the findings of the Investigating Commissioner were contrary
to the evidence on record. He cited the resolution of the STAVA Board of Trustees, dated 30
Superhighway, Makati, Metro Manila
October 1994, that read:

By:
KATITIKAN NG PULONG

(Sgd.) ISIDRO T. HILDAWA

NG

PTR NO. 9428868 / 1-21-94 / Muntinlupa

BOARD OF TRUSTEES

IBP NO. 347727 / 5-06-94 / Makati

NG

With My Conformity:
SIKAP AT TIYAGA ALABANG VENDORS

(Sgd.) Atty. PATRICIO L. BONCAYAO, JR.

ASSOCIATION, INC.

2nd Flr. Cattleya Commercial

Ginanap noong ika-30 ng Oktubre, 1994 sa

National Road, Alabang[1]

Tanggapan nito sa Alabang

Respondent lawyer issued a receipt, dated 09 December 1994, that acknowledged his having
Mga Dumalo:
received the withdrawn deposit of P104,543.80. Complainant alleged that STAVA was not
informed of the filing of the motion nor did it authorize Atty. Hildawa to withdraw the
amount. Despite repeated demands, respondent lawyer refused to turn over the withdrawn sum President - Fernando Salonga
to STAVA. To make matters even worse, added the complainant, Atty. Hildawa appeared as
counsel for Kilusang Bayan ng mga Magtitinda sa Pamilihang Bayan ng Muntinlupa (KBMBPM),
Executive Vice-Pres. - Tirso Sapar
an opponent of STAVA in Civil Case No. 95-192, for Injunction with Urgent Prayer for
Restraining Order, before Branch 276 of the Regional Trial Court of Muntinlupa. Eventually, the
RTC, acting on a motion to disqualify respondent in said case, directed, in its order of 26 VP Internal - Domingo Silava
December 1995, the latter to withdraw from the case and avoid committing an unethical
conduct.[2]
VP Security - Leonardo Gumapos
In his answer to the complaint, Atty. Hildawa countered that complainant was fully aware
of the withdrawal of the rental in arrears deposited by the defendants in the ejectment cases and Auditor - Undo Cipriano
that complainant, on several occasions, even accompanied him in following up the release of the
money. He said he did not turn over the amount withdrawn to complainant since Salonga was
then on leave; instead he handed over, on 10 December 1994, the sum to Dolores Javinar, the Hindi Dumalo:
treasurer of the association, who issued the corresponding receipt therefor.

In his reply, Salonga disclaimed the supposed turn-over of the money to Javinar and the VP External - Aser Arevalo
allegation that he was on leave of absence.
Treasurer - Dolores Javinar
This Court referred the case to the Integrated Bar of the Philippines (IBP) for investigation,
report and recommendation.
------------------------------------------------------------------------------------
In a resolution, dated 13 March 1998, the Commission on Bar Discipline, through
Commissioner Renato G. Cunanan, found respondent guilty of violation of Canons 16 and 21 of
the code of Professional Responsibility and recommended that he be suspended for one year Unang tinalakay sa pagpupulong and kaayusan ng samahan at mga dapat tupdin ng mga kasapi
from the practice of law. On 25 April 1998, the IBP Board of Governors, in its Resolution NO. bilang kanilang tungkulin sa samahan at sa lugar na kanilang pinagtitindahan. Ang kalinisan ay
XIII-98-72, resolved to adopt and approve the recommendation of the Investigating pinagtutuunan ng pansin.
Commissioner.
Bagamat on-leave ang pangulo natin, sa kahalagahan ng pinaguusapan siya ay narito sa
Soon after receiving a copy of the above-numbered resolution, respondent reverted to IBP pagpupulong.
seeking a reconsideration of its resolution only to be thereupon informed that the case had
Tinalakay ang hindi pagbabayad ng Market Fee at gamit electrical ng 11 dating miyembro ng
STAVA na tuwirang nagbabayad ngayon sa kooperatiba. Dahil dito ay nawawalan ng P450.00
hanggang P500.00 ang samahan sang-ayon sa taya ng pangulo.
Dahil dito, binigyan ng karapatan ang abogado ng samahan na isaayos ang dapat na
hakbanging legal upang malikom ang salapi para sa STAVA upang makatugon ito sa bayarin sa
KBMBMP at sa iba pang pagkakagastusan sa hinaharap na okasyon.
Mayroong pag-uusap upang wakasan ang usapin na idinulog ng STAVA laban sa Kooperatiba
sapagkat sa diwa ng magandang pagkakaunawaan at mabuting samahan, nais ng ipagkaloob
ng Kooperatiba ang hinihingi ng STAVA na lagyan ng hangganan ang lugar na ang mga
miembro ng STAVA ang siya lamang magtitinda sa halagang itatakda ng bawat panig.
Dito tumindig si Ester Dalde at ipinabatid sa kapulungan na siya ay kinausap ng Gen. Manager
ng Kooperatiba at tinatanong kung maari daw ay huwag ng paalisin ang labing-isang (11)
tumiwalag sa STAVA.
Tinalakay ng pamunuan ang bagay na ito at ang lahat ay nagkakaisa sa kanilang paninindigan
na dapat lamang palayasin ang lahat ng taksil at anay ng samahan upang maiwasan ang hindi
pagkakaunawaan at tuloy maging aral na din sa iba pa.
Isinunod na tinalakay ang mga balimbing o nagdadalawang mukha at inatasan na bumuo ng
kommitte tungkol dito upang mabatid kung sino-sino ang mga ito at malapatan ng kaukulang
lunas.
Sa ano mang Compromise Agreement na gagawin, hindi dapat pumayag na manatili pa ang
mga taksil sa STAVA at ang kooperatiba ang siyang magbibigay sa kanila ng lugar sa alin mang
parte ng palengke ngunit hindi sa Transient Area.
Ang pagpupulong ay itinindig sa ganap na ika-2:00 ng hapon.
(Sgd.) (Sgd.)
Fernando Salonga Tirso Sapar
President Executive Vice-President
(Sgd.) (Sgd.)
Domingo Silava Leonardo Gumapos
VP Internal VP Security
(Sgd.)
Undo Cipriano
[3]
Auditor
Respondent likewise sought to make the clarification that his services as counsel of STAVA
were already terminated in February 1995, long before he appeared as counsel for KBMBPM in
December 1995.
After a close review of the records, the Court is inclined to partially grant the motion for
reconsideration submitted by respondent.
The basis of the Investigating Commissioner for finding respondent lawyer to have violated
Canon 16[4] was the supposed admission of Atty. Hildawa that he withdrew the amount of
P104,543.80 for STAVA. This fact, however, was never denied by Atty. Hildawa. It would appear
that the real focus should have been then on the issue of whether or not the withdrawal of the
deposit by respondent had the clients authority. Apparently, he did have that authority under the
resolution, dated 30 October 1994, of the Board of Trustees of STAVA. The resolution, in part
was to the following effect:
Dahil dito, binigyan ng karapatan ang abogado ng samahan na isaayos ang dapat na
hakbanging legal upang malikom ang salapi para sa STAVA upang makatugon ito sa
bayarin sa KBMBPM at sa iba pang pagkakagastusan sa hinaharap na okasyon. [5]
One of the signatories of the resolution was complainant Fernando Salonga himself. Atty.
Hildawa did not keep the money but turned it over on 10 December 1994, or just one day after
receiving it (on 09 December 1994), to Dolores Javinar, the STAVA treasurer, who issued a
corresponding receipt therefor. What the treasurer or STAVA might have done thereafter with
the funds was no concern of respondent counsel.
The Court agrees with the Investigating Commissioner, however, that respondent lawyer
has transgressed Canon 21 which requires a lawyer to preserve the confidences and secrets of
his client even after the attorney-client relation ceases, a mandate that he has placed in possible
jeopardy by agreeing to appear as counsel for a party his client has previously contended with in
a case similarly involving said parties.
WHEREFORE, the Court ABSOLVES Atty. Isidro T. Hildawa from the charge of having
violated his obligation to hold in trust the funds of his client but REPRIMANDS him for having
placed at risk his obligation of preserving the confidentiality relationship with a previous client,
with a warning that a repetition of the same or similar conduct in the future will be dealt with most
severely.
SO ORDERED.
A.C. No. 76 July 23, 1952
SIMPLICIO NATAN, as administrator of the Intestate Estate of the deceased Maria
Sandoval de Petero,complainant,
vs.
ATTORNEY SIMEON CAPULE, respondent.
Simeon Capule in his own behalf.
Office of the Solicitor General Pompeyo Diaz and Solicitor Juan T. Alano for the Government.
LABRADOR, J.:
These proceedings were instituted by the Solicitor General upon complaint of Simplicio Natan
against Simeon Capule, an attorney-at-law who is charged with the following acts of misconduct
in his office as lawyer: (1) for having failed to appear, without any justifiable reason, in the
hearing of a case for which he had received his fees in full; (2) for having accepted professional
employment in the very case in which this former client is the adverse party, and utilizing against
the latter papers, knowledge, and information obtained in the course of his previous
employment; and (3) for falsely accusing tenants of his former clients and causing their
detention, in order to compel them to enter into a compromise by giving him (respondent) one-
half of their rice harvests.
Complainant Simplicio Natan is the judicial administrator of the estate of the deceased Maria
Sandoval de Patero, appointed by the Court of First Instance of Palawan, and is in possession of
all the properties of said deceased. During the lifetime of the decedent's husband Santiago
Patero, Natan had filed an action against Patero to recover the wife's share in the conjugal
properties. Santiago Patero was condemned to deliver his wife's share in conjugal assets to
Natan and to render an accounting of the fruits thereof while he was in possession. As he failed
to make such accounting, his one-half share in the hacienda known as Hacienda Minit was
ordered delivered to Natan for Administration.
The above proceedings took place before the year 1922. Santiago Patero died in August, 1925.
Both he and his deceased wife left no descendants. In 1935 Natan filed a project of partition of
the properties left by Maria Sandoval de Patero and said partition was approved on March 23,
1937. Natan has continued in possession of the Hacienda Minit in his original capacity as
administrator.
In the middle of the year 1949, Natan filed an action of forcible entry against Francisco Edonga,
Jose Cabungan, and Piloromo Raon (Civil Case No. 15, in the Justice of the Peace Court of
Coron, Palawan) for having illegally occupied and detained portions of the Hacienda Minit under
Natan's administration, and contracted the services of the respondent herein, Simeon Capulan,
for the hearing of the case. The first professional act made by respondent in connection with that
case was the preparation of an amended complaint and an opposition to dismiss the case.
Capule received the amount of P50 as part of his fees at that time, and fixed his fees for the
whole case in the amount of P250. From time to time he had been getting sums of money from
the complainant as partial payments of his fee. Up to October 7, 1949, he had received the sum
of P180. On this date the case was called for hearing and respondent appeared at the trial, but it
had to be postponed to November 17, 1949. As respondent maintained an office in Manila and
had to come to Manila before the hearing, he told his client not to worry as he would take a boat
from Manila in time to reach Coron for the hearing on November 17, 1949. He assured his client
that in case he would not be able to arrive on time, he would ask the judge for postponement.
The respondent did not arrive on the date of the hearing, and as the judge refused to grant
postponement, complainant handled his case personally being a lawyer himself, without the
presence of respondent. All in all he was able to collect the amount of P275 from complainant.
On November 21, 1949, respondent filed a petition, with the conformity of Natan to withdraw as
attorney for the latter in said Civil Case No. 15.
The above are the facts involved in the first charge. With respect to the other charges, it appears
that when Natan contracted respondent's professional services in the month of August, 1949 he
delivered to respondent various documents, among which are a copy of the decision in Civil
Case No. 96 of the Court of First Instance of Palawan instituted by Natan against the deceased
Santiago Patero for the recovery of certain properties belonging to the latter's wife, Exhibit A-2, a
copy of the decision in Civila Case No. 104 of the same court filed by Natan against Santiago
Patero for the recovery of the wife's share in conjugal properties in the possession of Patero,
Exhibit A-3, the project of partition, Exhibit A-5 the order of the court approving the project of
partition, Exhibit A-4, tax declarations of Hacienda Minit, Exhibits A-6, A-7, A-9, and A-10, the
new tax declaration of Hacienda Minit in the name of the deceased Estefania Rodriguez, Exhibit
A-8, various receipts for the payment of taxes, Exhibits A-11 to A-15, and the plan of Hacienda
Minit, Exhibit A-16. Towards the end of the month of November, 1949, according to respondent's
own witness Olimpio Patero, the latter had talked to respondent in connection with his claim to
the Hacienda Minit, based on his pretension that he was a recognized child of the deceased
Santiago Patero (see certificate of baptism, Exhibit 12). After respondent was employed by
Olimpio Patero, the following incidents took place:
(1) On January 13, 1950, Olimpio Patero filed a motion that he be allowed to intervene in Civil
Case 188 of the Court of First Instance of Palawan, entitled Simplicio Natan vs. Francisco
Edonga, et al. (the same Civil Case No. 15 of the Justice of the Peace Court of Coron, supra), in
which the professional services of respondent had been contracted and paid for by Natan
(Exhibits L and N). The intervention is improperly designated third party complaint. Both motion
and pleading are, however, signed by Olimpio Patero.
(2) On February 27, 1950, respondent herein filed on behalf of Olimpio Patero a petition in the
administration proceedings (Civil Case No. 71, Court of First Instance of Palawan), alleging that
Olimpio Patero is the sole heir of Santiago M. Patero, and that he is in possession of Hacienda
Minit; that the administrator of the estate of the deceased Maria Sandoval de Patero,
complainant herein Simplicio Natan, had been encroaching upon the land constituting the
Hacienda Minit, interfering with its use and occupation and depriving Olimpio Patero of the
harvest of coconut and palay; and praying that Simplicio Natan be restrained from interfering
with the occupation and enjoyment of the Hacienda Minit by Olimpio Patero, and that Natan
should be ordered to return to Olimpio Patero 400 cavanes of palay representing his one-half
share in the land, or the equivalent value of P4,400, as well as the coconuts and copra which he
may have gathered amounting to not less than 37 tons valued at not less than P13,320 (Exhibit
O). This petition was opposed by Natan (Exhibit Q). In the Petition the lands constituting the
Hacienda Minit are set forth in accordance with the description appearing in Tax Declarations
Nos. 5785 and 7862, both in the name of Santiago Patero (Exhibit A-9 and A-6). The petition
also contains a statement of the area of the land constituting the Hacienda Minit, together with
the number of coconut trees thereon, also based on Tax Declaration No. 2037 (Exhibit A-7),
which was furnished respondent by complainant herein.
(3) On May 5, 1950, Olimpio Patero signed an affidavit that he was the sole heir of the deceased
Santiago Patero stating that the number of cattle and carabaos left by his deceased father and
describing the land also left by him, and asserting that he adjudicated to himself the entire estate
of the deceased under Rule 74, section 1, of the Rules of Court (Exhibit P-1). Before the end of
the year 1949, a complaint had been filed by Natan against Olimpio Patero for trespass. In a
motion for postponement of the hearing of said case filed by Patero (Exhibit 7), he alleges that
his lawyer was to come from Manila, and this lawyer must have been respondent herein. Again
in the month of March, 1950, another complaint was filed against Olimpio Patero, et al. charging
him and others of frustrated murder committed on the persons of Arsenio Santillan and Manuel
Natan (Exhibit Y).
(4) Olimpio Patero had filed on January 10, 1950, an action for robbery with attempted homicide
against Ernesto Natan and cases for swindling against Benigno Rios, Maximiano Pabia, Balbino
Yapla, and Juan Bermudes (Exhibits C, D, E, F). The above accusations were, however
dismissed by the Justice of the peace on the ground that there was no probate cause that the
crimes had been committed (Exhibits J and K). Upon the filing of the complaint for estafa the
four accused were arrested and detained in the municipal jail of Coron. Thereupon, respondent
herein went to see them and secured from three of them a written statement that they would
deliver to Olimpio Patero, the owner of Hacienda Minit, his share in the harvest that the three
obtained from the portions they have cultivated (Exhibit 6). When the three accused signed the
affidavit, respondent asked the chief of police to release them, but when they went to get the
palay in the granary where their harvest were being kept, the granary was closed. Thereupon,
respondent ask them to break open the lock, but the three refused, so the respondent told the
chief of police to take them back into his custody again, and so they were put back in jail.
In connection with the complaint filed against the four above-named persons, including
complainant's son, respondent denied having acted as lawyer for Olimpio Patero, or for having
asked them to compromise their criminal case upon giving him the palay which is the share of
the owner of the land. But we cannot agree to his claim. Olimpio Patero was already his client constituting not merely unethical practice but a clear and direct violation of the following portion
when the estafa cases were filed, and the same are evident attempts to get possession of the of his oath as lawyer:
land and get the tenants of the Hacienda Minit to recognize him as the owner, clearly for the
direct benefit of his client. He admits that he was present when the compromise was being
. . . . I will do no falsehood, nor consent to the doing of any in court; I will not wittingly
signed, but that it was not he who secured the signatures thereto. For what purpose was he
or willingly promote or sue any groundless, false or unlawful suit, nor give aid nor
present, if not in the ultimate interest of his client? As between his uncoroborated denial and the
consent to the same; I will conduct myself as a lawyer according to the best of my
positive assertion of three members of the poor working class, that he asked them to sign the
knowledge and discretion, with all good fidelity as well to the courts as to my clients; . .
compromise, our choice is the latter, not only because respondent's own testimony must
. . (Emphasis ours.)
necessarily be biased and that of his opponents more impartial, as they are indifferent to the
result of this proceedings, but also because the lowly and the indigent are generally reputed to
be timid, God-fearing and truthful. His conduct evinces a character wanting in truthfulness, and devoid of that sense of fairness and
justice so essential to the profession that he has embraced. But this is the first occasion that
respondent is charged in this Court with misconduct, and we prefer to grant him the opportunity
We are convinced that the respondent had utilized the papers and the knowledge and
to reform. But we can not let his misconduct pass unpunished; we must impose upon him a
information that he had received from his former client Simplicio Natan, in relation to the
penalty which would, at the same time, serve a purpose of a warning. The majority of this Court
Hacienda Minit, against Natan and for the benefit of his new client Patero. The data appearing in
believes that suspension from his office as lawyer for a period of two years would serve both
the petition that he had filed in Civil Case No. 71, intestate proceedings of the deceased Maria
purposes.
Sandoval de Patero, could not have been obtained by him only from the papers of said
case(Exhibit A-2). We are also convinced that the respondent must have been the one who
induced Olimpio Patero (his client) to accuse falsely the tenants of the complainant in Hacienda Wherefore, this Court absolves respondent from the first charges, but finds him guilty of all the
Minit of the crime of estafa. More than that, as the respondent knew that his client was not in other charges preferred against him by the Solicitor General and suspends him from the
possession of the hacienda, he also must have known that his new client had no right to demand exercise of his profession as attorney-at-law for a period of two (2) years, the period to
the harvests thereon from the tenants of the complainant. He also must have `known that under commence upon receipt by him of notice of final resolution of this Court in this case.
no circumstances whatsoever could the tenants be guilty of estafa for their failure or refusal to
deliver the harvests to his new client. From all of these it is apparent that the action for estafa
must have been maliciously concede to obtain unlawfully what he could not lawfully get. CANON 22

ELISA V. VENTEREZ, GENARO DE A. C. No. 7421

As to the first charge, however, we find that the respondent's failure to appear, as he had agreed VERA, INOCENCIA V. RAMIREZ, Present:
and promised, was in voluntary on his part, because it appears that he had never expected that PACITA V. MILLS, ANTONINA V.
the judge before whom the case was pending would refuse to grant his motion for PALMA and RAMON DE VERA,
postponement. YNARES-SANTIAGO, J.,
Complainants, Chairperson,
It is evident from the foregoing that respondent, because of his previous relationship with the AUSTRIA-MARTINEZ,
complainant herein, was disqualified to accept the case of Olimpio Patero who claimed
ownership of the Hacienda Minit. The immediate objective of Patero was to wrest possession of CHICO-NAZARIO,
the Hacienda Minit from the respondents former client, Natan which possession it was the
latter's duty to protect and support. The fact that respondent herein retired from the forcible entry NACHURA, and
case on November 21,1949, prior to retaining the case of Olimpio Patero, did not relieve him - versus -
from his obligation of fidelity and loyalty to his former client.(7 C.J.S. 827) The inconsistency REYES, JJ.
between his position as attorney for Olimpio Patero and that as attorney for complainant was so
apparent that it could not have escaped respondent's attention. Respondent may not excuse his
conduct behind the shield of the presumption of good faith, because the inconsistency was clear.
But what makes the violation of his obligation of fidelity more improper is the fact that in
forwarding Patero's interest, he did actually utilize the papers, knowledge and information which ATTY. RODRIGO R. COSME,
he had received in the course of his employment as lawyer for complainant herein. Promulgated:
Respondent.
An attorney is forbidden to do either of two thing after severing his relationship with the
former client. He may not do anything which will injuriously affect his former client in
any matter in which he formerly represented him, nor may heat any time use against October 10, 2007
his former client knowledge or information acquired by virtue of the previous
relationship. Wutchumna Water Co. vs. Bailey, 15 P. (2d) 505, 509, 216 Cal. 564 (7 x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x
C.J.S. 828.)

But if the conduct of the respondent in accepting Pateros casein using papers and documents to
the prejudice of his former client is unexcusable, in prosecuting the tenants of his former client RESOLUTION
for estafa without reasonable grounds, causing their imprisonment in order to compel them to CHICO-NAZARIO, J.:
deliver portion of their palay harvests to his second client, his conduct was reprehensible,
Before Us is a Complaint filed by complainants Eliza V. Venterez, Genaro de Vera, Inocencia V.
Ramirez, Pacita V. Mills, Antonina V. Palma and Ramon de Vera against respondent Atty.
Rodrigo R. Cosme, charging the latter with Abandonment, Gross Negligence and Dereliction of
Duty.
Complainants contracted the legal services of respondent in Civil Case No. 981 entitled, Sps.
Daniel and Lolita Oviedo, et al. v. Eliza de Vera, et al., for Declaration of Ownership with
Damages filed before the Municipal Trial Court (MTC) of Calasiao, Pangasinan. Respondent
represented the complainants, who were defendants in said case, until a Decision thereon was
rendered by the MTC on 25 February 2004. The MTC ruled against the
complainants. Respondent received a copy of the said Decision on 3 March 2004.
Complainants alleged that they directed the respondent to either file a Motion for
Reconsideration or a Notice of Appeal, but respondent failed or refused to do so. The 15-day
period within which to file an appeal or a motion for reconsideration of the MTC Decision expired
on 18 March 2004.Complainant Elisa V. Venterez was constrained to contract another lawyer to
prepare the Motion for Reconsideration which was filed on 19 March 2004. It must be stressed
that the said motion was signed by complainant Elisa V. Venterez herself as the said lawyer did
not enter his appearance.
On 23 March 2004, the said Motion for Reconsideration was denied [1] by the MTC. Respondent
was not furnished a copy of the denial of the motion per a Certification[2] issued by Clerk of Court
II Zenaida C. de Vera. On 31 March 2004, a Motion for Issuance of Writ of Execution[3] was filed
by the plaintiffs in Civil Case No. 981 but respondent never bothered to file an opposition to or
any comment on the said motion despite receipt thereof. The motion was eventually granted[4] by
the MTC on 23 April 2004. On 28 April 2004, a Writ of Execution[5] was issued and on 26 April
2004, an Entry of Judgment[6] was made in the said case.
Two months after respondent received a copy of the Decision, the respondent filed his Notice of
Retirement of Counsel with the MTC on 3 May 2004.
Feeling aggrieved by respondents actuations, complainants filed the instant administrative
complaint against him.[7]
In his Answer,[8] respondent denied the claim of complainants that soon after the Decision was
rendered by the MTC, they (complainants) directed him to file an appeal or a motion for
reconsideration thereof. For his defense, respondent averred that Salvador Ramirez (the son of
one of the complainants, Inocencia V. Ramirez), informed him that he [was] withdrawing the
case from the respondent because he already engaged another lawyer to take over the case, so
respondent gave the records of the case to him. Respondent explained that after Salvador
Ramirez withdrew the case from the respondent, and engaged another lawyer, the respondent
turned over the records of the case to him and the respondent ceased as the counsel of the
complainants. Respondent further alleged that the said Motion for Reconsideration was already
prepared by another lawyer. He denied being furnished a copy of the Motion for Reconsideration
allegedly prepared and filed by another lawyer engaged by complainant Elisa V. Venterez and
that he was served with a copy of the denial of the said Motion by the MTC. Respondent also
clarified that the last day of the 15-day period for the perfection of the appeal is 19 March
2004 since a copy of the decision was served on the respondent on 4 March 2004. Finally,
respondent argued that when the respondent was served a copy of the Motion for Writ of
Execution, he immediately notified Salvador Ramirez about said Motion but Salvador Ramirez
came to see the respondent only on 3 May 2005, when the respondent asked him to sign a
Notice of Retirement of Counsel signed by Salvador Ramirez which respondent immediately
filed in court.
Pursuant to the complaint, a hearing was conducted by the Commission on Bar
Discipline of the Integrated Bar of the Philippines (IBP) at
the IBP Building, Ortigas Center, Pasig City, on 15 February 2006.
On 11 April 2006, Investigating Commissioner Dennis A. B. Funa submitted his Report
and Recommendation,[9] finding respondent liable for gross negligence and recommending the
imposition upon him of the penalty of three months suspension, to wit:
PREMISES CONSIDERED, it is submitted that Respondent is GUILTY of
Gross Negligence and should be given the penalty of THREE (3) MONTHS
SUSPENSION.
Thereafter, the IBP Board of Governors passed Resolution[10] No. XVII-2006-457
dated 8 September 2006, approving and adopting the recommendation of the Investigating
Commissioner, thus:
RESOLVED to ADOPT and APPROVE, as it is hereby ADOPTED and
APPROVED, the Report and Recommendation of the Investigating
Commissioner of the above-entitled case, herein made part of this
Resolution as Annex A; and, finding the recommendation fully supported by
the evidence on record and the applicable laws and rules, and considering
that Respondent is guilty of gross negligence, Atty. Rodrigo Cosme is
hereby SUSPENDED from the practice of law for three (3) months.[11]
We sustain the findings and recommendation of the IBP Board of Governors.
The core issue is whether the respondent committed culpable negligence in handling
complainants case, as would warrant disciplinary action.
No lawyer is obliged to advocate for every person who may wish to become his client, but once
he agrees to take up the cause of a client, the lawyer owes fidelity to such cause and must be
mindful of the trust and confidence reposed in him.[12] Among the fundamental rules of ethics is
the principle that an attorney who undertakes an action impliedly stipulates to carry it to its
termination, that is, until the case becomes final and executory. A lawyer is not at liberty to
abandon his client and withdraw his services without reasonable cause and only upon notice
appropriate in the circumstances.[13] Any dereliction of duty by a counsel affects the client.[14] This
means that his client is entitled to the benefit of any and every remedy and defense that is
authorized by the law and he may expect his lawyer to assert every such remedy or defense. [15]
 The Decision in Civil Case No. 981 was rendered by the MTC of Calasaio,
Pangasinan, on 25 February 2004. Respondent admitted[16] that he was served a copy of the
said Decision on 4 March 2004. After having received a copy of the MTC Decision, respondent What constitute good cause for the withdrawal of services by the counsel are identified
did not bother to file a Motion for Reconsideration or a notice of appeal with the proper courts. under Rule 22.01, Canon 22 of the Code of Professional Responsibility, which provides:
Thus, complainants were compelled to engage the services of a new counsel to file a Motion for
Reconsideration with the MTC who did not, however, enter his appearance as new counsel. It
bears stressing that during this time, respondent had not yet filed any notice of withdrawal as
counsel for the complainants in Civil Case No. 981. Respondent only formally withdrew as CANON 22 -- A LAWYER SHALL WITHDRAW HIS SERVICES
counsel for complainant in Civil Case No. 981 when he filed with the MTC his Notice[17] of ONLY FOR GOOD CAUSE AND UPON NOTICE APPROPRIATE IN THE
Retirement as Counsel on 5 May 2004, on the ground that "he was also retired as Counsel for CIRCUMSTANCES.
the [complainants] two days after he received copy of the decision rendered in this case when
SALVADOR RAMIREZ, a representative of the [complainants], withdrew all the records of the
case from [respondent] to be given to his new counsel.
Rule 22.01-- A lawyer may WITHDRAW his services in any of the
following cases:
We cannot accept respondents defense that he had already withdrawn from the case two days
after his receipt of the MTC Decision and that he had allegedly communicated this withdrawal to
Salvador Ramirez, son of one of the herein complainants, Inocencia Ramirez. It is an apparent
a) When the client pursues an illegal or immoral
attempt on the part of respondent to wash his hands of any liability for failing to pursue any of course of conduct in connection with the matter he is handling;
the available remedies to complainants from the adverse MTC Decision.
b) When the client insists that the lawyer pursue
conduct violative of these canons and rules;
The rule in this jurisdiction is that a client has the absolute right to terminate the attorney- c) When his inability to work with co-counsel will not
client relation at any time with or without cause. [18] The right of an attorney to withdraw or
promote the best interest of the client;
terminate the relation other than for sufficient cause is, however, considerably
restricted.[19] Among the fundamental rules of ethics is the principle that an attorney who
d) When the mental or physical condition of the
undertakes to conduct an action impliedly stipulates to carry it to its conclusion. [20] He is not at
lawyer renders it difficult for him to carry out the employment
liberty to abandon it without reasonable cause.[21] A lawyer's right to withdraw from a case before
effectively;
its final adjudication arises only from the client's written consent or from a good cause. [22]
e) When the client deliberately fails to pay the fees for
the services or fails to comply with the retainer agreement;
Section 26, Rule 138 of the Revised Rules of Court provides:
f) When the lawyer is elected or appointed to public
office; and

g) Other similar cases.

Sec. 26. Change of attorneys -- An attorney may retire at any time
from any action or special proceeding, by the written consent of his client filed in
The instant case does not fall under any of the grounds aforementioned. Neither can
court. He may also retire at any time from an action or special proceeding,
the circumstances of this case be considered analogous to the grounds thus explicitly
without the consent of his client, should the court, on notice to the client and
enumerated. Contrary to respondents contention, his professional relations as a lawyer with his
attorney, and on hearing, determine that he ought to be allowed to retire. In case
clients are not terminated by the simple turnover of the records of the case to his
of substitution, the name of the attorney newly employed shall be entered on the
clients. Respondents defense completely crumbles in face of the fact that Salvador Ramirez is
docket of the court in place of the former one, and written notice of the change
not even a party in Civil Case No. 981 and, hence, had no authority to withdraw the records of
shall be given to the adverse party.
the said case from respondent or to terminate the latters services.

A lawyer may retire at any time from any action or special proceeding with the written
consent of his client filed in court and with a copy thereof served upon the adverse party. Should
the client refuse to give his consent, the lawyer must file an application with the court. The court,
on notice to the client and adverse party, shall determine whether the lawyer ought to be allowed
to retire. The application for withdrawal must be based on a good cause. [23]
Assuming, nevertheless, that respondent was justified in withdrawing his services, he,
however, cannot just do so and leave complainants in the cold, unprotected. The lawyer has no
right to presume that his petition for withdrawal will be granted by the court. [24] Until his
withdrawal shall have been approved, the lawyer remains counsel of record who is expected by
his clients, as well as by the court, to do what the interests of his clients require. [25] He must still
appear before the court to protect the interest of his clients by availing himself of the proper
remedy, for the attorney-client relations are not terminated formally until there is a withdrawal of
record.
 Without a proper revocation of his authority and withdrawal as counsel, respondent SO ORDERED.
remains counsel of record for the complainants in Civil Case No. 981; and whether he has a
valid cause to withdraw from the case, he cannot immediately do so and leave his clients without
representation.An attorney may only retire from the case either by a written consent of his client
or by permission of the court after due notice and hearing, in which event, the attorney should
see to it that the name of the new attorney is recorded in the case.[26] Respondent did not comply
with these obligations. Therefore, he remains the counsel of record for the complainants in Civil
Case No. 981 with the duty to protect complainants interest. Had he made the necessary
inquiries as to the status of the case, he would have known that he was still the counsel of
record as no entry of appearance was ever made by another counsel. It would have been easily
discernible on his part that there was no change in his status as complainants lawyer. As of that
time, their client-lawyer relationship was still subsisting.Therefore, he would have known that the
Motion for Reconsideration was denied; and a writ of execution had been issued under the
circumstances.

All told, we rule and so hold that on account of respondents failure to protect the
interest of complainants, respondent indeed violated Rule 18.03, Canon 18 of the Code of
Professional Responsibility, which states that a lawyer shall not neglect a legal matter entrusted
to him, and his negligence in connection therewith shall render him liable. Respondent is
reminded that the practice of law is a special privilege bestowed only upon those who are
competent intellectually, academically and morally. This Court has been exacting in its
expectations for the members of the Bar to always uphold the integrity and dignity of the legal
profession and refrain from any act or omission which might lessen the trust and confidence of
the public.

The determination of the appropriate penalty to be imposed on an errant lawyer

involves the exercise of sound judicial discretion based on the facts of the case. [27] In cases of
similar nature, the penalty imposed by the Court consisted of reprimand, [28] fine of five hundred
pesos with warning,[29] suspension of three months,[30] six months[31] and even disbarment[32] in
an aggravated case.

The facts of the case show that respondent failed to live up to his duties as a lawyer
pursuant to the Code of Professional Responsibility. We conclude that a 3-month suspension
from the practice of law is a just penalty under the circumstances.

WHEREFORE, the resolution of the IBP Board of Governors approving and adopting
the report and recommendation of the Investigating Commissioner is
hereby AFFIRMED. Accordingly, ATTY. RODRIGO R. COSME is hereby SUSPENDED from the
practice of law for a period of THREE (3) MONTHS, with a stern warning that a repetition of the
same or similar wrongdoing will be dealt with more severely.

Let a copy of this decision be attached to respondents personal record with the Office
of the Bar Confidant and copies be furnished to all chapters of the Integrated Bar of
the Philippines and to all courts of the land.