Nature and Creation of Attorney-Client Relationship

(Canons 14 to 16 Notes –Based on Recitation Questions)

Recitation Questions:
1.) Start of a lawyer-client relationship (ACR)
 It begins from the time an attorney/lawyer is retained
 Two concepts of reference:
o Act of a client which he engages in the services of an attorney to
render legal advice
o To defend his cause in court
 Employment is considered to be an essential feature
 It can also start by being a counsel de oficio for a poor or indigent
litigant

2.) Kinds of retainer

 General retainer: purpose is to secure beforehand the services of an
attorney for any legal problem that may afterward arise
 Special retainer: has reference to a particular case or service
 Retaining fee: preliminary fee paid to insure and secure his future
services, to remunerate him from being deprived, by being retained by
one party, is neither made nor received in consideration for the services
contemplated; purpose: to prevent undue hardship on the part of the
lawyer resulting from the rigid observance of the rule forbidding him
from acting as counsel for the other party after he has been retained by or
has given professional advice to the opposite party
 Necessity of retainer: the purpose is to have power to act as counsel;
also considered as a “contract of employment” that can be expressed or
implied; also is a form or ratification

3.) Is there a need for a contract?

 No. The ACR can be expressed or implied. However, a written agreement
is the best proof to show the relation

4.) Is it possible for a lawyer-client relationship to exist without an express

agreement?
 A written agreement is the best proof to show the relation, but not real
form is necessary
 It is sufficient to establish the professional relation through providing
the advice and assistance of the lawyer was sought (it can be
expressed or implied)
 Example of implied: the lawyer appears on behalf of the party without
the latter interposing any objection thereto

5.) Case of Uy vs. Gonzales

6.) Exceptions to right to decline employment

 Rule 14.03 of the CPR states the following exceptions (for indigent
clients):
o He is in no position to carry out the work effectively or
competently
 o He labors under a conflict of interest between him and the
prospective client or between a present client and the
prospective client

7.) Amicus Curiae vs. Counsel de Oficio? (Rule 14.02)

 Amicus Curiae: an experienced and impartial attorney invited by the
court to appear and help in the disposition of issued submitted to it
 Counsel de Oficio: an attorney appointed by the court to defend an
indigent defendant in a criminal action; no other choice by the litigant
than the acceptance of whoever is appointed as his counsel
o He has the bounden duty to exert utmost efforts to defend his
client and to protect his rights, no matter how guilty or evil he
appears to be
 The main difference between the two is the nature of the obligation:
an amicus curiae is invited by the Court to help the judges or justices
in creating their dispositions/rulings in the case; a counsel de oficio
on the other hand, is tasked by the Court to represent an indigent
litigant

8.) Case of Santiago vs. Fojas

9.) What is conflict of interest? (Rule 15.03)

 A situation in which the concerns or aims of two different parties are
incompatible
 Rule 15.03 of the CPR: a lawyer shall not represent conflicting interests
 A lawyer who represents a party and at the same time handles the legal
problems of the opposing party, whether the cases are related or not,
violates the rule against representation of conflicting interests

10.) What are the kinds of conflict of interest? (Rule 15.03)

 Conflicting duties
 Invitation of suspicion
 Use of prior knowledge obtained
 Lawyer of a corporation and joining the union of employees of that
corporation
 Lawyer/counsel of an insurance company and representing the injured
person
 Lawyer is a receiver of the corporation; he cannot represent the creditor
 Opposing clients in same or related suits: a lawyer appearing for opposing
clients in the same actions
 Opposing clients in unrelated actions (constitutes double-dealing)
 New client against former client

11.) What is the duty of a lawyer in representing conflict of interest?

(Rule 15.03)
 It is the duty of the lawyer to disclose and explain to a prospective
client all circumstances of his relations to the parties and any
interest in or connection with the controversy, which in his honest
judgment might influence the client in the selection of counsel
  Disclosure: more for the protection of the lawyer than of the client
 It is the lawyer’s duty to decline employment: he may NOT accept
employment from another in a matter adversely affecting any
interest of his former client with respect to which confidence has
been reposed
o Duty to decline employment is in view of the rule prohibiting
representation of conflicting interests

12.) Tests in determining conflict of interest (Rule 15.03)

 Test to determine the existence of the conflict of interest: probability
of conflict
 Tests found in the case of Pomento vs. Ponteverde:
o If the acceptance of the new retainer will require the attorney to
do anything which will injuriously affect his first client in any
manner in which he represents him, and also whether he will be
called upon in his new relation, to use against his first client any
knowledge acquired through their connection
o WoN the acceptance of a new relation will prevent an attorney
from the full discharge of his duty of undivided fidelity and loyalty
to his client or invite suspicion of unfaithfulness or double-dealing
in the performance thereof
 Questions to consider:
o Will the attorney be required to contest for that which his duty to
another client requires him to oppose? (conflicting duties)
o Will the acceptance of a new relation invite suspicion and/or
actually lead to unfaithfulness or double-dealing towards another
client? (invitation of suspicion)
o Will the attorney be called upon in his new relation to use against
his first client any knowledge acquired in the previous
employment? (Use of prior knowledge obtained)

13.) Case of Anion vs. Sabitsana

14.) Why is the (written) consent of both parties needed when acting as
mediator, conciliator, or arbitrator? (Rule 15.04)
 Mediator: a person who attempts to make people involved in a conflict
come to an agreement
 Conciliator: a person who acts as a mediator between two disputing
people or groups
 Arbitrator: an independent person or body officially appointed to settle a
dispute
 His knowledge of the law and his reputation for fidelity may make it easy
for the disputants to settle their differences amicably; however, a lawyer
shall not act as counsel for any of them. Otherwise, the rule prohibiting
representation of conflict of interests will apply
 Consent is needed because it is to confirm that both parties agree to the
lawyer being the mediator, conciliator or arbitrator of their case, as well
as to confirm that arbitration or alternative resolution is what both
parties would want to do
15.) What is privileged communication? (Rule 15.02)
 An interaction between two parties in which the law recognizes a private,
protected relationship; whatever is communicated between these pairs of
parties shall remain confidential
 Attorney-client privilege: legal advice of any kind is sought from an
attorney in his professional capacity with respect to communications
relating to that purpose, made in confidence by the client so as
permanently to protect such communications at the instance of the client
from disclosure by himself or by the lawyer, unless the protection is
waived
 Requisites of privilege:
o Legal advice of any kind is sought
o From a professional legal adviser in his capacity as such
o The communications relating to that purpose
o Made in confidence
o By the client
o Are at his instance permanently protected
o From disclosure by himself or by the legal advisor
o Except the protection be waived
 Factors:
o There exists an attorney-client relationship, or a prospective ACR,
and it is by reason of this relationship that the client made the
communication
o The client made the communication in confidence
o The legal advice must be sought from the attorney in his
professional capacity

16.) Regala case

17.) What is influence peddling?

 Under Rule 15. 06 of the CPR
 The use of position or political influence on someone’s behalf in exchange
for money or favors

18.) The rule on two (2) occupations?

 Rule 15.08: a lawyer shall make it clear whether he is acting in another
capacity
 Reason: certain ethical considerations governing the attorney-client
relationship may be operative in one and not in the other
 A lawyer who is engaged in another profession or occupation
concurrently with the practice of law shall make clear to his client
whether he is acting as a lawyer or in another capacity
 A practicing lawyer may lawfully engage in any other lawful occupation or
business

19.) Fiduciary relationship between client and lawyer? (Canon 16)
 Fiduciary: Involving trust and confidence
  It exists as a matter of law between attorney and client, which requires all
dealings growing out of such relationship to be subject to the closes
judicial scrutiny
 Effect of fiduciary relations:
o Position of attorney enables him to put client under his power, and
opens attorney to the temptation to avail himself undue
advantages, bargains and gratitudes by taking advantage of client
o The highly fiduciary and strictly confidential relationship
between attorney and client is to remove all such temptation
and to prevent everything of that kind from being done for the
protection of the client

20.) When shall the lawyer deliver funds to his client?

 Rule 16.03: “A lawyer shall deliver the funds and property of his client
when due or upon demand”
 Generally, the failure to return the client’s money upon demand gives the
presumption that the lawyer has misappropriated it for his own use

21.) What is a lien?

 A right to keep possession of property belonging to another person until a
debt owed by that person is discharged

22.) What are the kinds of lien?

 Retaining liens: the right of an attorney to retain the funds, documents
and papers of his client which have lawfully come into his possession
until his lawful fees and disbursements have been paid and to apply such
funds to the satisfaction thereof
o Also considered as a general lien for the balance of the
account due to the attorney from his client for services
rendered in all matters which he may have handled for the
client, regardless of their outcome
 Charging liens: the right which the attorney has upon all judgments for
the payment of money and executions issued in pursuance thereof,
secured in favour of the client; it covers services rendered by an attorney
in the action in which the judgment was obtained and takes effect only
after he shall have caused a statement of his claim to be entered upon the
record of the particular action with written notice thereof to his client and
to the adverse party

23.) Elements of retaining lien?

 There must be an attorney-client relationship
 There should be lawful possession by the lawyer of the client’s funds,
documents and papers in his professional capacity
 There must be an unsatisfied claim for attorney’s fees or disbursements

24.) Can a lawyer borrow money from clients?

 Rule 16.04
 General rule: No
  Exception: interests are fully protected by the nature of the case or by
independent advice

25.) Can a lawyer lend money?

 Rule 16.04
 General rule: No
 Exception: when in the interest of justice, he has to advance necessary
expenses in a legal matter he is handling for the client

26.) Junio Case