EN
BANC
TEODORO
R. REGALA, EDGARDO J. ANGARA,
AVELINO V. CRUZ, JOSE C. CONCEPCION,
ROGELIO A. VINLUAN, VICTOR P. LAZATIN
and EDUARDO U. ESCUETA,
Petitioners,
G. R. No. 105938
September 20, 1996
-versus-
HON.
SANDIGANBAYAN, FIRST DIVISION,
REPUBLIC
OF THE PHILIPPINES, acting through
the
PRESIDENTIAL
COMMISSION ON GOOD GOVERNMENTand RAUL S. ROCO,
Respondents.
_________________________________________________
PARAJA
G. HAYUDINI,
Petitioner,
G. R. No. 108113
September 20, 1996
-versus-
SANDIGANBAYAN
and THE REPUBLIC OF THE PHILIPPINES,
Respondents.
D
E C I S I O N
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.cralaw:red
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 of 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 client
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:
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, consideration 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.
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]
The 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.chanrobles virtual law libraryThe Honorable Sandiganbayan
gravely
abused
its discretion in subjecting petitioners ACCRA lawyers who indisputably
acted as lawyers in serving as nominee-stockholders, to the strict
application
of the law of agency.chanrobles virtual law libraryII.chanrobles virtual law libraryThe 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.chanrobles virtual law library
1. There is absolutely no evidence
that
Mr.
Roco had revealed, or had undertaken to reveal, the identities of the
clients
for whom he acted as nominee-stockholder.chanrobles virtual law library
2. Even assuming that Mr. Roco had
revealed,
or had undertaken to reveal, the identities of the clients, the
disclosure
does not constitute a substantial distinction as would make the
classification
reasonable under the equal protection clause.chanrobles virtual law library
3. Respondent Sandiganbayan
sanctioned
favoritism
and undue preference in favor of Mr. Roco in violation of the equal
protection
clause.chanrobles virtual law library
III.chanrobles virtual law libraryThe 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.chanrobles virtual law library
1. Under the peculiar facts of this
case,
the attorney-client privilege includes the identity of the client[s].chanrobles virtual law library
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.chanrobles virtual law library
IV.chanrobles virtual law libraryThe 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.chanrobles virtual law library
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.cralaw:red
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.chanrobles virtual law library
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 PCGG's 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. [Emphasis
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:
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. Conjuangco 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.chanrobles virtual law library
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.cralaw:red
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.cralaw:red
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 concept 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:
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 attorney's 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 client's 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.cralaw:red
The question now
arises whether or not this duty
may be asserted in refusing to disclose the name of petitioners'
clients
in the case at bar. Under the facts and circumstances obtaining in the
instant case, the answer must be in the affirmative.cralaw:red
As a matter of
public policy, a client's 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 this 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] A
client's identity is privileged
where a strong probability exists that revealing the client's name
would
implicate that client in the very activity for which he sought the
lawyer's
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 client's
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 client's identity
before
a grand jury. Reversing the lower court's 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.cralaw:red
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 lawyer's legal advice was obtained.cralaw:red
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.cralaw:red
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 client's identity and the nature of
that
client's
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 client's consent."
8 J. Wigmore, supra Sec. 2291, at 545. In furtherance of this
policy,
the client's 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 lawyer's 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 is 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]
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; 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.
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
court's 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 lawyer's 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
government's lawyers have no case against
an attorney's client unless, by revealing the client's 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 client's 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].cralaw:red
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 Baird's 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
client's
income tax liability pending. The court emphasized the exception that a
client's name is privileged when so much has been revealed concerning
the
legal services rendered that the disclosure of the client's 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 identity which 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 client's 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 not
attorney-client
relationship].cralaw:red
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 client's 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 client sought 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.cralaw:red
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.cralaw:red
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 prosecution's suspicions, then the
client's
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.cralaw:red
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.cralaw:red
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 the 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.cralaw:red
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.cralaw:red
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.cralaw:red
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 by lawyers vis-a-vis their clients because the law, which the
lawyers are sworn to uphold, in the words of Oliver Wendell Holmes,[58]
"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? 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
client's
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
Investment 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.cralaw:red
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.chanrobles virtual law library
In response to
petitioners' last assignment of
error, respondents alleged 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 the
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.cralaw:red
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
absolute 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 species apart from the rest of the ACCRA lawyers on the basis of a
classification
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.cralaw:red
The equal
protection clause is a guarantee which
provides a wall of protection against uneven application of status and
regulations. In the broader sense, the guarantee operates against
uneven
application of legal norms sothat all persons under similar
circumstances
would be accorded the same treatment.[62]
Those who fall within a particular class ought to be treated alike not
only as to privileges granted but also as to the liabilities imposed.cralaw:red
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 PCGG's
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.cralaw:red
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.cralaw:red
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 litigation when it
is obvious that their inclusion in the complaint arose from a
privileged
attorney-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 at this early
opportunity would be to sanction an unjust situation which We should
not
here countenance. The case hangs as a real and palpable threat, a
proverbial
Sword of Damocles over petitioners' heads. It should not be allowed to
continue a day longer.cralaw:red
While We are
aware of respondent PCGG's legal
mandate to recover ill-gotten wealth, We will not sanction acts which
violate
the equal protection guarantee and the right against self-incrimination
and subvert the lawyer-client confidentiality privilege.cralaw:red
WHEREFORE, in
view of the foregoing, the resolutions
of respondent Sandiganbayan [First Division] promulgated on March 18,
1992
and May 21, 1992 are hereby annulled and set aside. Respondent
Sandiganbayan
is further ordered to exclude petitioners Teodoro D. Regala, Edgardo J.
Angara, Avelino V. Cruz, Jose C. Concepcion, Victor P. Lazatin, Eduardo
U. Escueta and Paraja G. Hayuduni as parties-defendants in SB Civil
Case
No. 0033 entitled "Republic of the Philippines v. Eduardo
Cojuangco,
Jr., et al."
SO ORDERED.cralaw:red
Bellosillo, Melo
and Francisco, JJ., concur.
Padilla,
Panganiban and Torres, Jr., JJ.,
concur in the result.
Romero and
Hermosisima, Jr., JJ., took
no part.
Mendoza, J.,
is on leave.
Separate OpinionsVITUG, J.,
Concurring:
The legal profession, despite all the
unrestrained
calumny hurled against it, is still the noblest of professions. It
exists
upon the thesis that, in an orderly society that is opposed to all
forms
of anarchy, it so occupies, as it should, an exalted position in the
proper
dispensation of justice. In time, principles have evolved that would
help
ensure its effective ministration. The protection of confidentiality of
the lawyer-client relationship is one, and it has since been an
accepted
firmament in the profession. It allows the lawyer and the client to
institutionalize
a unique relationship based on full trust and confidence essential in a
justice system that works on the basis of substantive and procedural
due
process. To be sure, the rule is not without its pitfalls, and demands
against it may be strong, but these problems are, in the ultimate
analysis,
no more than mere tests of vigor that have made and will make that rule
endure.
I see in the case
before Us, given the attendant
circumstances already detailed in the ponencia, a situation of
the
Republic attempting to establish a case not on what it perceives to be
the strength of its own evidence but on what it could elicit from a
counsel
against his client. I find it unreasonable for the Sandiganbayan to
compel
petitioners to breach the trust reposed on them and succumb to a thinly
disguised threat of incrimination.cralaw:red
Accordingly, I
join my other colleagues who vote
for the GRANT of the petition.
DAVIDE, JR., J.:
Dissenting
The impressive presentation of the case in
the
ponencia of Mr. Justice Kapunan makes difficult the espousal of a
dissenting
view. Nevertheless, I do not hesitate to express that view because I
strongly
feel that this Court must confine itself to the key issue in this
special
civil action for certiorari, viz., whether or not the
Sandiganbayan
acted with grave abuse of discretion in not excluding the defendants,
the
petitioners herein, from the Third Amended Complaint in Civil Case No.
0033. That issue, unfortunately, has been simply buried under the
avalanche
of authorities upholding the sanctity of lawyer-client relationship
which
appears to me to be prematurely invoked.
From the
undisputed facts disclosed by the pleadings
and summarized in the ponencia, I cannot find my way clear to a
conclusion that the Sandiganbayan committed grave abuse of discretion
in
not acting favorably on the petitioners' prayer in their Comment to the
PCGG's Motion to Admit Third Amended Complaint.cralaw:red
The prerogative
to determine who shall be made
defendants in a civil case is initially vested in the plaintiff, or the
PCGG in this case. The control of the Court comes in only when the
issue
of "interest" [Section 2, Rule 3, Rules of Court] as, e.g.,
whether
an indispensable party has not been joined, or whether there is a
misjoinder
of parties [Sections 7, 8, and 9, Id.], is raised.cralaw:red
In the case
below, the PCGG decided to drop or
exclude from the complaint original co-defendant Raul Roco because he
had
allegedly complied with the condition prescribed by the PCGG, viz.,
undertake that he will reveal the identity of the principals for whom
he
acted as nominee/stockholder in the companies involved in PCGG Case No.
0033. In short, there was an agreement or compromise settlement between
the PCGG and Roco. Accordingly, the PCGG submitted a Third Amended
Complaint
without Roco as a defendant. No obstacle to such an agreement has been
insinuated. If Roco's revelation violated the confidentiality of a
lawyer-client
relationship, he would be solely answerable therefor to his
principals/clients
and, probably, to this Court in an appropriate disciplinary action, if
warranted. There is at all no showing that Civil Case No. 0033 cannot
further
be proceeded upon or that any judgment therein cannot be binding
without
Roco remaining as a defendant. Accordingly, the admission of the Third
Amended Complaint cannot be validly withheld by the Sandiganbayan.cralaw:red
Are the
petitioners, who did not file a formal
motion to be excluded but only made the request to that effect as a
rider
to their Comment to the Motion to Admit Third Amended Complaint,
entitled
to be excluded from the Third Amended Complaint such that denial
thereof
would constitute grave abuse of discretion on the Sandiganbayan's part?
To me, the answer is clearly in the negative.cralaw:red
The petitioners
seek to be accorded the same benefit
granted to or to be similarly treated as Roco. Reason and logic dictate
that they cannot, unless they too would make themselves like Roco.
Otherwise
stated, they must first voluntarily adopt for themselves the factual
milieu
created by Roco and must bind themselves to perform certain obligations
as Roco. It is precisely for this that in response to the petitioners'
comment on the aforementioned Motion to Admit Third Amended Complaint,
the PCGG manifested that it is willing to accord the petitioners the
treatment
it gave Roco provided they would do what Roco had done, that is,
disclose
the identity of their principals/clients and submit documents
substantiating
their claimed lawyer-client relationship with the said
principals/clients
as well as copies of deeds of assignment the petitioners executed in
favor
of their principals/clients. The petitioners did not do so because they
believed that compliance thereof would breach the sanctity of their
fiduciary
duty in a lawyer-client relationship.cralaw:red
It, indeed,
appears that Roco has complied with
his obligation as a consideration for his exclusion from the Third
Amended
Complaint. The Sandiganbayan found that
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 action 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. 14-1 in relation to
the
Supreme Court's ruling in Republic v. Sandiganbayan [173 SCRA 72].
As a matter of
fact, the PCGG presented evidence
to substantiate Roco's compliance. The ponencia itself so
stated,
thus:
Respondent PCGG presented evidence 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 Roco, Bunag, and Kapunan Law Offices dated September 21, 1988
to the respondent in behalf of private respondent Roco originally
requesting
the reinvestigation and/or re-examination of evidence by the PCGG it
Complaint
in PCGG Case No. 33. [Id., 5-6].
These are the
pieces of evidence upon which the Sandiganbayan
founded its conclusion that the PCGG was satisfied with Roco's
compliance.
The petitioners have not assailed such finding as arbitrary.
The ponencia's
observation then that Roco
did not refute the petitioners' contention that he did not comply with
his obligation to disclose the identity of his principals is entirely
irrelevant.
In view of their adamant position, the petitioners did not, therefore,
allow themselves to be like Roco. They cannot claim the same treatment,
much less compel the PCGG to drop them as defendants, for nothing
whatsoever.
They have no right to make such a demand for until they shall have
complied
with the conditions imposed for their exclusion, they cannot be
excluded
except by way of a motion to dismiss based on the grounds allowed by
law
[e.g., those enumerated in Section 1, Rule 16, Rules of Court].
The rule of confidentiality under the lawyer-client relationship is not
a cause to exclude a party. It is merely a ground for disqualification
of a witness [Section 24, Rule 130, Rules of Court] and may only be
invoked
at the appropriate time, i.e., when a lawyer is under compulsion
to answer as witness, as when, having taken the witness stand, he is
questioned
as to such confidential communication or advice, or is being otherwise
judicially coerced to produce, through subpoena duces tecum or
otherwise,
letters or other documents containing the same privileged matter. But
none
of the lawyers in this case is being required to testify about or
otherwise
reveal "any [confidential] communication made by the client to him, or
his advice given thereon in the course of, or with a view to,
professional
employment." What they are being asked to do, in line with their claim
that they had done the acts ascribed to them in pursuance of their
professional
relation to their clients, is to identify the latter to the PCGG and
the
Court; but this, only if they so choose in order to be dropped from the
complaint, such identification being the condition under which the PCGG
has expressed willingness to exclude them from the action. The
revelation
is entirely optional, discretionary, on their part. The attorney-client
privilege is not, therefore, applicable.cralaw:red
Thus, the
Sandiganbayan did not commit any abuse
of discretion when it denied the petitioners' prayer for their
exclusion
as party-defendants because they did not want to abide with any of the
conditions set by the PCGG. There would have been abuse if the
Sandiganbayan
granted the prayer because then it would have capriciously,
whimsically,
arbitrarily, and oppressively imposed its will on the PCGG.
Again, what the petitioners want is their
exclusion
from the Third Amended Complaint or the dismissal of the case insofar
as
they are concerned because either they are invested with immunity under
the principle of confidentiality in a lawyer-client relationship, or
the
claims against them in Civil Case No. 0033 are barred by such principle.cralaw:red
Even if We have
to accommodate this issue, I still
submit that the lawyer-client privilege provides the petitioners no
refuge.
They are sued as principal defendants in Civil Case No. 0033, a case
for
the recovery of alleged ill-gotten wealth. Conspiracy is imputed to the
petitioners therein. In short, they are, allegedly conspirators in the
commission of the acts complained of for being nominees of certain
parties.
Their inclusion as defendants is justified under Section 15, Article XI
of the Constitution which provides that the right of the State to
recover
properties unlawfully acquired by public officials or employees, from
them
or from their nominees or transferees, shall not be barred by
prescription,
laches or estoppel and E. O. No. 1 of 28 February 1986, E. O. No.
2 of 12 March 1986, E. O. No. 14 of 7 May 1986, and the Rules and
Regulations
of the PCGG. Furthermore, Section 2, Rule 110 of the Rules of
Court
requires that the complaint or information should be "against all
persons
who appear to be responsible for the offense involved."
Hypothetically
admitting the allegations in the
complaint in Civil Case No. 0033, I find myself unable to agree with
the
majority opinion that the petitioners are immune from suit or that they
have to be excluded as defendants, or that they cannot be compelled to
reveal or disclose the identity of their principals, all because of the
sacred lawyer-client privilege. This privilege is well put in Rule 130
of the Rules of Court, to wit:
Section 24. Disqualification by
reason
of privileged communication. - The following persons cannot testify
as to matters learned in confidence in the following cases:
[b] 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, nor can an attorney's 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.
The majority
seeks to expand the scope of the Philippine
rule on the lawyer-client privilege by copious citations of American
jurisprudence
which includes in the privilege the identity of the client under the
exceptional
situations narrated therein. From the plethora of cases cited, two
facts
stand out in bold relief. Firstly, the issue of privilege contested
therein
arose in grand jury proceedings on different States, which are
preliminary
proceedings before the filing of the case in court, and we are not even
told what evidentiary rules apply in the said hearings. In the present
case, the privilege is invoked in the court where it was already filed
and presently pends, and we have the foregoing specific rules
above-quoted.
Secondly, and more important, in the cases cited by the majority, the
lawyers
concerned were merely advocating the cause of their clients but were
not
indicted for the charges against their said clients. Here, the counsel
themselves are co-defendants duly charged in court as co-conspirators
in
the offenses charged. The cases cited by the majority evidently
do
not apply to them.
Hence, I wish to
repeat and underscore the fact
that the lawyer-client privilege is not a shield for the commission of
a crime or against the prosecution of the lawyer therefor. I quote,
with
emphases supplied, from 81 Am Jur 2d, Witnesses, Sections 393 to 395,
pages
356-357:
Section 393. Effect of unlawful
purpose.-
The existence of an unlawful purpose
prevents
the attorney-client privilege from attaching. The attorney-client
privilege
does not generally exist where the representation is sought to further
criminal or fraudulent conduct either past, present, or future. Thus, a
confidence received by an attorney in order to advance a criminal or
fraudulent
purpose is beyond the scope of the privilege.
Observation:
The common-law rule that the
privilege protecting confidential communications between attorney and
client
is lost if the relation is abused by a client who seeks legal
assistance
to perpetrate a crime or fraud has been codified.
Section 394. Attorney participation. -
The attorney-client privilege cannot be
used
to protect a client in the perpetration of a crime in concert with the
attorney, even where the attorney is not aware of his client's purpose.
The reason for the rule is that it is not within the professional
character
of a lawyer to give advised on the commission of crime. Professional
responsibility
does not countenance the use of the attorney-client privilege as a
subterfuge,
and all conspiracies, either active or passive, which are calculated to
hinder the administration of justice will vitiate the privilege. In
some
jurisdictions, however, this exception to the rule of privilege in
confined
to such intended acts in violation of the law as are mala in se,
as distinguished from those which are merely mala prohibita.
Section 395. Communication in
contemplation
of crime. -
Communications between attorney and
client
having
to do with the client's contemplated criminal acts, or in aid or
furtherance
thereof, are not covered by the cloak of privilege ordinarily existing
in reference to communications between attorney and client. But, the
mere
charge of illegality, not supported by evidence, will not defeat the
privilege;
there must be at least prima facie evidence that the illegality has
some
foundation in fact.
Underhill also
states:
There are many other cases to the same
effect,
for the rule is prostitution 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. In accordance with this rule, where a
forged
will or other false instrument has come into possession of an attorney
through the instrumentality of the accused, with the hope and
expectation
that the attorney would take some action in reference thereto, and the
attorney does act, in ignorance of the true character of the
instrument,
there is no privilege, inasmuch as full confidence has been withheld.
The
attorney is then compelled to produce a forged writing against the
client.
The fact that the attorney is not cognizant of the criminal or wrongful
purpose, or, knowing it, attempts to dissuade his client, is
immaterial.
The attorney's ignorance of his client's intentions deprives the
information
of a professional character as full confidence has been withheld. [H.C.
Underhill, A Treatise on the Law of Criminal Case Evidence, Vol. 2,
Fifth
Ed. (1956), Sec. 332, pp. 836-837; Emphasis mine].
125 American
Law Reports Annotated, 516-519, summarizes
the rationale of the rule excepting communications with respect to
contemplated
criminal or fraudulent acts, thus:
c. Rationale of rule excepting
communications
with respect to contemplated criminal or fraudulent act.
Various reasons have been announced as
being
the foundation for the holdings that communications with respect to
contemplated
criminal or fraudulent acts are not privileged.
The reason perhaps most frequently
advanced is
that in such cases, there is no professional employment, properly
speaking.
Standard F. Ins. Co v. Smithhart (1919) 183 Ky 679, 211 SW. 441, 5 ALR
972; Cummings v. Com. (1927) 221 Ky 301, 298 SW 943; Strong v. Abner
(1937)
268 Ky 502, 105 SW(2d) 599; People v. Van Alstine (1885) 57 Mich 69, 23
NW 594; Hamil & Co. v. England (1892) 50 Mo App 338; Carney v.
United
R. Co. (1920) 205 Mo App 495, 226 SW 308; Matthews v. Hoagland (1891)
48
NJ Eq 455, 21 A 1054; Covency v. Tannahill (1841) 1 Hill (NY) 33, 37 AM
Dec 287; People ex rel. Vogelstein v. Warden (1934) 150 Misc 714, 270
NYS
362 (affirmed without opinion in (1934) 242 App Div 611, 271 NYS 1059);
Russell v. Jackson (1851) 9 Hare 387, 68 Eng Reprint 558; Charlton v.
Coombes
(1863) 4 Giff 372, 66 Eng Reprint 751; Reg. v. Cox (1884) LR 14 QB Div
(Eng) 153 CCR; Re Postlethwaite (1887) LR 35 Ch Div (Eng) 722.
In Reg. v. Cox
(1884) LR 14 QB Div (Eng) 153
CCR, the court said: "In order that the rule may apply, there must be
both
professional confidence and professional employment, but if the client
has a criminal object in view in his communications with his solicitor
one of these elements must necessarily be absent. The client must
either
conspire with his solicitor or deceive him. If his criminal object is
avowed,
the client does not consult his adviser professionally, because it
cannot
be the solicitor's business to further any criminal object. If the
client
does not avow his object, he reposes no confidence, for the state of
facts
which is the foundation of the supposed confidence does not exist. The
solicitor's advice is obtained by a fraud."
So, in Standard
F. Ins. Co. v. Smithhart [1919]
183 Ky 679, 211 SW 441, 5 ALR 972, the court said: "The reason of the
principle
which holds such communications not to be privileged is that it is not
within the professional character of a lawyer to give advice upon such
subjects, and that it is no part of the profession of an attorney or
counselor
at law to be advising persons as to how they may commit crimes or
frauds,
or how they may escape the consequences of contemplated crimes and
frauds.
If the crime or fraud has already been committed and finished, a client
may advise with an attorney in regard to it, and communicate with him
freely,
and the communications cannot be divulged as evidence without the
consent
of the client, because it is a part of the business and duty of those
engaged
in the practice of the profession of law, when employed and relied upon
for that purpose, to give advice to those who have made infractions of
the laws; and, to enable the attorney to properly advise and to
properly
represent the client in court or when prosecutions are threatened, it
is
conducive to the administration of justice that the client shall be
free
to communicate to his attorney all the facts within his knowledge, and
that he may be assured that a communication made by him shall not be
used
to his prejudice."
The protection
which the law affords to communications
between attorney and client has reference to those which are
legitimately
and properly within the scope of a lawful employment, and does not
extend
to communications made in contemplation of a crime, or perpetration of
a fraud. Strong v. Abner (1937) 368 Ky 502, 105 SW (2d) 599.cralaw:red
The court in
People v. Van Alstine [1885] 57 Mich
69, 23 NW 594, in holding not privileged, communications to an attorney
having for their object the communication of a crime, said: "They then
partake of the nature of a conspiracy, or attempted conspiracy, and it
is not only lawful to divulge such communications, but under certain
circumstances
it might become the duty of the attorney to do so. The interests of
public
justice require that no such shield from merited exposure shall be
interposed
to protect a person who takes counsel how he can safely commit a crime.
The relation of attorney and client cannot exist for the purpose of
counsel
in concocting crimes."
And in Coveney v.
Tannahill [1841] 1 Hill [NY]
33, 37 Am Dec 287, the court was of the opinion that there could be no
such relation as that of attorney and client, either in the commission
of a crime, or in the doing of a wrong by force or fraud to an
individual,
the privileged relation of attorney and client existing only for lawful
and honest purposes.cralaw:red
If the client
consults the attorney at law with
reference to the perpetration of a crime, and they co-operate in
effecting
it, there is no privilege, inasmuch as it is no part of the lawyer's
duty
to aid in crime he ceases to be counsel and becomes a criminal.
Matthews
v. Hoagland [1891] 48 NJ Eq 455, 21 A 1054.cralaw:red
The court cannot
permit it to be said that the
contriving of a fraud forms part of the professional business of an
attorney
or solicitor. Charlton v. Coombes [1863] 4 Giff 372, 66 Eng Reprint 751.
If the client does not frankly and freely
reveal
his object and intention as well as facts, there is not professional
confidence,
and therefore no privilege. Matthews v. Hoagland [NJ] supra. See to the
same effect Carney v. United R. Co. [1920] 205 Mo App 495, 226 SW 308.cralaw:red
There is no valid
claim of privilege in regard
to the production of documents passing between solicitor and client,
when
the transaction impeached is charged to be based upon fraud, that is
the
matter to be investigated, and it is thought better that the alleged
privilege
should suffer than that honestly and fair dealing should appear to be
violated
with impunity. Smith v. Hunt [1901] 1 Ont L Rep 334.
In Tichborne v. Lushington, shorthand Notes
[Eng]
p. 5211 [cited in Reg. v. Cox (1884) LR 14 QB Div (Eng) 172 CCR],
the Chief Justice said: "I believe the law is, and properly is, that if
a party consults an attorney, and obtains advice for what afterwards
turns
out to be the commission of a crime or a fraud, that party so
consulting
the attorney has no privilege whatever to close the lips of the
attorney
from stating the truth. Indeed, if any such privilege should be
contended
for, or existing, it would work most grievous hardship on an attorney,
who, after he had been consulted upon what subsequently appeared to be
a manifest crime and fraud, would have his lips closed, and might place
him in a very serious position of being suspected to be a party to the
fraud, and without his having an opportunity of exculpating
himself.
There is no privilege in the case which I have suggested of a party
consulting
another, a professional man, as to what may afterwards turn out to be a
crime or fraud, and the best mode of accomplishing it."
In Garside v.
Outram [1856] 3 Jur NS [Eng] 39,
although the question of privilege as to communications between
attorney
and client was not involved, the question directly involved being the
competency
of a clerk in a business establishment to testify as to certain
information
which he acquired while working in the establishment, the court
strongly
approved of a view as stated arguendo for plaintiff, in Annesley v.
Anglesea
[1743] 17 How St Tr [Eng] 1229, as follows: "I shall claim leave to
consider
whether an attorney may be examined as to any matter which came to his
knowledge as an attorney. If he is employed as an attorney in any
unlawful
or wicked act, his duty to the public obliges him to disclose it; no
private
obligations can dispense with that universal one which lies on every
member
of society to discover every design which may be formed, contrary to
the
laws of society, to destroy the public welfare. For this reason, I
apprehend
that if a secret which is contrary to the public good, such as a design
to commit treason, murder, or perjury, comes to the knowledge of an
attorney,
even in a cause where he is concerned, the obligation to the public
must
dispense with the private obligation to the client."
The court in
McMannus v. State [1858] 2 Head [Tenn]
213, said; "It would be monstrous to hold that if counsel was asked and
obtained in reference to a contemplated crime that the lips of the
attorney
would be sealed, when the facts might become important to the ends of
justice
in the prosecution of crime. In such a case the relation cannot be
taken
to exist. Public policy would forbid it." And
the court in Lanum v. Patterson [1909] 151 Ill App 36, observed that
this
rule was not in contravention of sound public policy, but on the
contrary,
tended to the maintenance of a higher standard of professional ethics
by
preventing the relation of attorney and client from operating as a
cloak
for fraud.cralaw:red
Communications of
a client to an attorney are
not privileged if they were a request for advice as to how to commit a
fraud, it being in such a case not only the attorney's privilege, but
his
duty, to disclose the facts to the court. Will v. Tornabells & Co.
[1907] 3 Puerto Rico Fed Rep 125. The court said: "We say this
notwithstanding
the comments of opposing counsel as to the indelicacy of his position
because
of his being now on the opposite side of the issue that arose as a
consequence
of the communication he testifies about, and is interested in the cause
to the extent of a large contingent fee, as he confesses."
The object of
prohibiting the disclosure of confidential
communications is to protect the client, and not to make the attorney
an
accomplice or permit him to aid in the commission of a crime. People
vs.
Petersen [1901] 60 App Div 118, NYS 941. The seal of personal
confidence
can never be used to cover a transaction which is in itself a crime.
People
v. Farmer [1909] 194 NY 251, 87 NE 457.cralaw:red
As to disclosing
the identity of a client, 81
Am Jur 2d, Witnesses, Section 410 and 411, pages 366-368, states:
Section 410. Name or identity of
client.-
Disclosure of a client's identity is
necessary
proof of the existence of the attorney-client relationship and is not
privileged
information. Thus, the attorney-client privilege is inapplicable even
though
the information was communicated confidentially to the attorney in his
professional capacity and, in some cases, in spite of the fact that the
attorney may have been sworn to secrecy, where an inquiry is directed
to
an attorney as to the name or identity of his client. This general rule
applies in criminal cases, as well as in civil actions. Where an
undisclosed
client is a party to an action, the opposing party has a right to
know with whom he is contending or who the real party in interest is,
if
not the nominal adversary.
Section 411. Disclosure of identity of
client
as breach of confidentiality.
The revelation of the identification of a
client
is not usually considered privileged, except where so much has been
divulged
with regard to to legal services rendered or the advice sought, that to
reveal the client's name would be to disclose the whole relationship
and
confidential communications. However, even where the subject matter of
the attorney-client relationship has already been revealed, the
client's
name has been deemed privileged.
Where disclosure of the identity of a
client
might harm the client by being used against him under circumstances
where
there are no countervailing factors, then the identity is protected by
the attorney-client privilege.
In criminal proceedings, a client's name
may
be privileged if information already obtained by the tribunal, combined
with the client's identity, might expose him to criminal prosecution
for
acts subsequent to, and because of, which he had sought the advice of
his
attorney.
Although as a general rule, the identity
of a
defendant in a criminal prosecution is a matter of public record and,
thus,
not covered by the attorney-client privilege, where the attorney has
surrendered
to the authorities physical evidence in his possession by way of the
attorney-client
relationship, the state must prove the connection between the piece of
physical evidence and the defendant without in any way relying on the
testimony
of the client's attorney who initially received the evidence and, thus,
the attorney may not be called to the stand and asked to disclose the
identity
of the client. However, an attorney cannot refuse to reveal the
identity
of a person who asked him to deliver stolen property to the police
department,
whether a bona fide attorney-client relationship exists between them,
inasmuch
as the transaction was not a legal service or done in the attorney's
professional
capacity.
Distinction: Where an attorney
was
informed
by a male client that his female acquaintance was possibly involved in
[a] his-and-run accident, the identity of the female did not come
within
scope of attorney-client privilege although the identity of the male
client
was protected. [Emphases supplied]
Wigmore
explains why the identity of a client is
not within the lawyer-client privilege in this manner:
Section 2313. Identity of client
or
purpose of suit. The identity of the attorney's client or the
name of the real party in interest will seldom be a matter communicated
in confidence because the procedure of litigation ordinarily
presupposes
a disclosure of these facts. Furthermore, so far as a client may in
fact
desire secrecy and may be able to secure action without appearing as a
party to the proceedings, it would be improper to sanction such a wish.
Every litigant is in justice entitled to know the identity of his
opponents.
He cannot be obliged to struggle in the dark against unknown forces. He
has by anticipation the right, in later proceedings, if desired, to
enforce
the legal responsibility of those who may have maliciously sued or
prosecuted
him or fraudulently evaded his claim. He has as much right to ask the
attorney
"Who fees your fee?" as to ask the witness [966, supra]. "Who
maintains
you during this trial?" upon the analogy of the principle already
examined
[2298, supra], the privilege cannot be used to evade a client's
responsibility for the use of legal process. And if it is necessary for
the purpose to make a plain exception to the rule of confidence, then
it
must be made. [Wigmore on Evidence, Vol. 8, (1961), p. 609; emphases
supplied].
In 114 ALR,
1322, We also find the following statement:
1. Name or identity.
As is indicated in 28 R.C.L. p. 563,
it
appears
that the rule making communications between attorney and client
privileged
from disclosure, ordinarily does not apply where the inquiry is
confined
to the fact of the attorney's employment and the name of the person
employing
him, since the privilege presupposes the relationship of client and
attorney,
and therefore does not attach to its creation.
At the present
stage of the proceedings below, the
petitioners have not shown that they are so situated with respect to
their
principals as to bring them within any of the exceptions established by
American jurisprudence. There will be full opportunity for them to
establish
that fact at the trial where the broader perspectives of the case shall
have been presented and can be better appreciated by the court. The
insistence
for their exclusion from the case is understandable, but the reasons
for
the hasty resolution desired is naturally suspect.
We do not even
have to go beyond our shores for
an authority that the lawyer-client privilege cannot be invoked to
prevent
the disclosure of a client's identity where the lawyer and the client
are
conspirators in the commission of a crime or a fraud. Under our
jurisdiction,
lawyers are mandated not to counsel or abet activities aimed at
defiance
of the law or at lessening confidence in the legal system [Rule 1.02,
Canon
1, Code of Professional Responsibility] and to employ only fair and
honest
means to attain the lawful objectives of his client [Rule 19.01, Canon
19, Id.]. And under the Canons of Professional Ethics, a lawyer
must steadfastly bear in mind that his great trust is to be performed
within
and not without the bounds of the law [Canon 15, Id.], that he
advances
the honor of his profession and the best interest of his client when he
renders service or gives advice tending to impress upon the client and
his undertaking exact compliance with the strictest principles of moral
law [Canon 32, Id.]. These canons strip a lawyer of the
lawyer-client
privilege whenever he conspires with the client in the commission of a
crime or a fraud.cralaw:red
I then vote to
deny, for want of merit, the instant
petition.cralaw:red
Narvasa, C.J. and
Regalado, J., concur.
PUNO, J.,
Dissenting:
This is an important Petition for
Certiorari
to annul the Resolutions of the respondent Sandiganbayan denying
petitioners'
motion to be excluded from the Complaint for recovery of alleged
ill-gotten
wealth on the principal ground that as lawyers, they cannot be ordered
to reveal the identity of their client.
First, We fast
forward the facts. The Presidential
Commission on Good Government [PCGG] filed Civil Case No. 33 before the
Sandiganbayan against Eduardo M. Cojuangco, Jr., for the recovery of
alleged
ill-gotten wealth. Sued as co-defendants are the petitioners in the
cases
at bar lawyers Teodoro Regala, Edgardo J. Angara, Avelino V.
Cruz,
Jose Concepcion, Rogelio A. Vinluan, Victor P. Lazatin, Eduardo Escueta
and Paraja Hayudini. Also included as a co-defendant is lawyer Raul
Roco,
now a duly elected senator of the Republic. All co-defendants were then
partners of the Law Firm of Angara, Abello, Concepcion, Regala and Cruz
Law Offices, better known as the ACCRA Law Firm. The Complaint against
Cojuangco, Jr., and the petitioners alleged, inter alia, viz:
The wrongs committed by defendants acting
singly
or collectively and in unlawful concert with one another, include the
misappropriation
and theft of public funds, plunder of the nation's wealth, extortion,
blackmail,
bribery, embezzlement and other acts of corruption, betrayal of public
trust and brazen abuse of power as more fully described (in the
subsequent
paragraphs of the complaint), all at the expense and to the grave and
irreparable
damage of plaintiff and the Filipino people.
Defendants Eduardo Cojuangco, Jr.,
Edgardo J.
Angara, Jose C. Concepcion, Teodoro D. Regala, Avelino V. Cruz, Regalio
A. Vinluan, Eduardo U. Escueta, Paraja G. Hayudini and Raul S. Roco of
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 the San Miguel Corporation
shares
and the institutionalization through presidential directives of the
coconut
monopoly. 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
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 7 June 1984.
In their
Answer, petitioners alleged that the legal
services offered and made available by their firm to its clients
include:
(a) organizing and acquiring business organizations, (b) acting as
incorporators
or stockholders thereof, and (c) delivering to clients the
corresponding
documents of their equity holdings [i.e., certificates of stock
endorsed in blank or blank deeds of trust or assignment]. They claimed
that their activities were "in furtherance of legitimate lawyering."
In the course of
the proceedings in the Sandiganbayan,
the PCGG filed a Motion to Admit Third Amended Complaint and the Third
Amended Complaint excluding lawyer Roco as party defendant. Lawyer Roco
was excluded on the basis of his promise to reveal the identity of the
principals for whom he acted as nominee/stockholder in the companies
involved
in the case. The Sandiganbayan ordered petitioners to comment on the
motion.
In their Comment, petitioners demanded that they be extended the same
privilege
as their co-defendant Roco. They prayed for their exclusion from the
complaint.
PCGG agreed but set the following conditions: [1] disclosure of the
identity
of their client; [2] submission of documents substantiating their
lawyer-client
relationship; and [3] submission of the deeds of assignment petitioners
executed in favor of their client covering their respective
shareholdings.
The same conditions were imposed on lawyer Roco.cralaw:red
Petitioners
refused to comply with the PCGG conditions
contending that the attorney-client privilege gives them the right not
to reveal the identity of their client. They also alleged that lawyer
Roco
was excluded though he did not in fact reveal the identity of his
clients.
On March 18, 1992, the Sandiganbayan denied the exclusion of
petitioners
in Case No. 33. It held:
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 the 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 course 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 a party defendants. In the same vein, they
cannot compel the PCGG to be accorded the same treatment accorded to
Roco.
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.
Sandiganbayan
later denied petitioners' motions for
reconsideration in its resolutions dated May 21, 1988 and September 3,
1992.
In this petition
for certiorari, petitioners contend:
I.chanrobles virtual law libraryThe Honorable Sandiganbayan
gravely
abused
its discretion in subjecting petitioners ACCRA lawyers who indisputably
acted as lawyers in serving as nominee-stockholders, to the strict
application
of the law agency.chanrobles virtual law libraryII.chanrobles virtual law libraryThe 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.chanrobles virtual law library
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.chanrobles virtual law library
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.chanrobles virtual law library
3. Respondent Sandiganbayan
sanctioned
favoritism
and undue preference in favor of Mr. Roco and violation of the equal
protection
clause.chanrobles virtual law library
III.chanrobles virtual law library
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.chanrobles virtual law library
1. Under the peculiar facts of this
case,
the attorney-client privilege includes the identity of the client[s].chanrobles virtual law library
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.chanrobles virtual law library
IV.chanrobles virtual law libraryThe 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.chanrobles virtual law library
The petition at
bar is a typical of the usual
case where the hinge issue involves the applicability of
attorney-client
privilege. It ought to be noted that petitioners were included as
defendants
in Civil Case No. 33 as conspirators. Together with Mr. Cojuangco, Jr.,
they are charged with having "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, CICI and more than twenty other
coconut
levy funded corporations, including the acquisition of San Miguel
Corporation
shares and the institutionalization through presidential directives of
the coconut monopoly." To stress, petitioners are charged with having
conspired
in the commission of crimes. The issue of attorney-client privilege
arose
when PCGG agreed to exclude petitioners from the complaint on condition
they reveal the identity of their client. Petitioners refused to comply
and assailed the condition on the ground that to reveal the identity of
their client will violate the attorney-client privilege.cralaw:red
It is, thus,
necessary to resolve whether the
Sandiganbayan committed grave abuse of discretion when it rejected
petitioners'
thesis that to reveal the identity of their client would violate the
attorney-client
privilege. The attorney-client privilege is the oldest of the
privileges
for confidential communications known to the common law.[1]
For the first time in this jurisdiction, we are asked to rule whether
the
attorney-client privilege includes the right not to disclose the
identity
of client. The issue poses a trilemma for its resolution
requires
the delicate balancing of three opposing policy considerations. One
overriding
policy consideration is the need for courts to discover the truth for
truth
alone is the true touchstone of justice.[2]
Equally compelling is the need to protect the adversary system of
justice
where truth is best extracted by giving a client broad privilege to
confide
facts to his counsel.[3]
Similarly deserving of sedulous concern is the need to keep inviolate
the
constitutional right against self-incrimination and the right to
effective
counsel in criminal litigations. To bridle at center the centrifugal
forces
of these policy considerations, courts have followed the prudential
principle
that the attorney-client privilege must not be expansively construed as
it is in derogation of the search for truth.[4]
Accordingly, a narrow construction has been given to the privilege and
it has been consistently held that "these competing societal interests
demand that application of the privilege should not exceed that which
is
necessary to effect the policy considerations underlying the privilege,
i.e., the privilege must be upheld only in those circumstances for
which it was created.'"[5]
Prescinding from
these premises, our initial task
is to define in clear strokes the substantive content of the
attorney-client
privilege within the context of the distinct issues posed by the
petition
at bar. With due respect, I like to start by stressing the irreducible
principle that the attorney-client privilege can never be used as a
shield
to commit a crime or a fraud. Communications to an attorney having for
their object the commission of a crime "partake the nature of a
conspiracy,
and it is not only lawful to divulge such communications, but under
certain
circumstances it might become the duty of the attorney to do so. The
interests
of public justice require that no such shield from merited exposure
shall
be interposed to protect a person who takes counsel how he can safely
commit
a crime. The relation of attorney and client cannot exist for the
purpose
of counsel in concocting crimes."[6]
In the well chosen words of retired Justice Quiason, a lawyer is not a
gun for hire.[7]
I hasten to add, however, that a mere allegation that a lawyer
conspired
with his client to commit a crime or a fraud will not defeat the
privilege.[8]
As early as 1933, no less than Mr. Justice Cardozo held in Clark v.
United
States[9]
that: "there are early cases apparently to the effect that a mere
charge
of illegality, not supported by any evidence, will set the confidences
free. But this conception of the privilege is without support. To
drive the privilege away, there must be 'something to give colour to
the
charge;' there must be prima facie evidence that it has
foundation
in fact." In the petition at bar, however, the PCGG appears to have
relented
on its original stance as spelled out in its complaint that petitioners
are co-conspirators in crimes and cannot invoke the attorney-client
privilege.
The PCGG has agreed to exclude petitioners from the complaint provided
they reveal the identity of their client. In fine, PCGG has conceded
that
petitioners are entitled to invoke the attorney-client privilege if
they
reveal their client's identity.cralaw:red
Assuming then
that petitioners can invoke the
attorney-client privilege since the PCGG is no longer proceeding
against
them as co-conspirators in crimes, We should focus on the more specific
issue of whether the attorney-client privilege includes the right not
to
divulge the identity of a client as contended by the petitioners. As a
general rule, the attorney-client privilege does not include the right
of non-disclosure of client identity. The general rule, however, admits
of well-etched exceptions which the Sandiganbayan failed to recognize.
The general rule and its exceptions are accurately summarized in In
re Grand Jury Investigation,[10]
viz:
The federal forum
is unanimously in accord with
the general rule that the identity of a client is, with limited
exceptions,
not within the protective ambit of the attorney-client privilege. See:
In re Grand Jury Proceedings [Pavlick], 680 F.2d 1026, 1027 [5th Cir.
1982]
(En Banc); In re Grand Jury Proceedings [Jones], 517 F. 2d 666, 670-71
[5th Cir. 1975]; In re Grand Jury Proceedings [Fine], 651 F. 2d 199,
204
[5th Cir. 1981]; Frank v. Tomlinson, 351 F.2d 384 [5th Cir. 1965],
cert.
denied, 382 U.S. 1082, 86 S.Ct. 648, 15 L.Ed.2d 540 [1966]; In re Grand
Jury Witness [Salas], 695 F.2d 359, 361 [9th Cir. 1982]; In re Grand
Jury
Subpoenas Duces Tecum [Marger/Merenbach], 695 F.2d 363, 365 [9th Cir.
1982];
In re Grand Jury Proceedings [Lawson], 600 F.2d 215, 218 [9th Cir.
1979].cralaw:red
The Circuits have
embraced various "exceptions"
to the general rule that the identity of a client is not within the
protective
ambit of the attorney-client privilege. All such exceptions appear to
be
firmly grounded in the Ninth Circuit's seminal decision in Baird v.
Koerner,
279 F.2d 633 [9th Cir. 1960]. In Baird the IRS received a letter from
an
attorney stating that an enclosed check in the amount of $12,706 was
being
tendered for additional amounts due from undisclosed taxpayers. When
the
IRS summoned the attorney to ascertain the identity of the delinquent
taxpayers
the attorney refused identification assertion the attorney-client
privilege.
The Ninth Circuit, applying California law, adjudged that the
"exception"
to the general rule as pronounced in Ex parte McDonough, 170 Cal. 230,
149 P. 566 [1915] controlled:
The name of the client will be considered
privileged
matter where the circumstances of the case are such that the name of
the
client is material only for the purpose of showing an acknowledgment of
guilt on the part of such client of the very offenses on account of
which
the attorney was employed.
Baird, supra,
279 F.2d at 633. The identity
of the Baird taxpayer was adjudged within this exception to the general
rule. The Ninth Circuit has continued to acknowledge this exception.
A significant
exception to this principle of non-confidentiality
holds that such information may be privileged when the person invoking
the privilege is able to show that a strong possibility exists that
disclosure
of the information would implicate the client in the very matter for
which
legal advice was sought in the first case.cralaw:red
In re: Grand Jury
Subpoenas Duces Tecum [Marger/Merenbach],
695 F.2d 363, 365 [9th Cir. 1982]. Accord: United States v. Hodge and
Zweig,
548 F.2d 1347, 1353 [9th Cir. 1977]; In re Grand Jury Proceedings
[Lawson],
600 F.2d 215, 218 [9th Cir. 1979]; United States v. Sherman, 627 F.2d
189,
190-91 [9th Cir. 1980]; In re Grand Jury Witness [Salas], 695 F.2d 359,
361 [9th Cir. 1982]. This exception, which can perhaps be most
succinctly
characterized as the "legal advice" exception, has also been recognized
by other circuits. See: In re Walsh, 623 F.2d 489, 495 [7th Cir.],
cert.
denied, 449 U.S. 994, 101 S. Ct. 531, 66 L.Ed.2d 291 [1980]; In re
Grand
Jury Investigation [Tinari], 631 F.2d 17, 19 [3d Cir 1980], cert.
denied,
449 U.S.1083, 101 S.Ct. 869-70, 66 L.Ed.2d 808 [1981]. Since the legal
advice exception is firmly grounded in the policy of protecting
confidential
communications, this Court adopts and applies its principles herein.
See:
In re Grand Jury Subpoenas Duces Tecum [Marger/Merenbach], supra.
It should be
observed, however, that the legal
advice exception may be defeated through a prima facie showing
that
the legal representation was secured in furtherance of present or
intended
continuing illegality, as where the legal representation itself is part
of a larger conspiracy. See: In re Grand Jury Subpoenas Decus Tecum
[Marger/Merenbach],
supra, 695 F.2d at 365 n. 1; In re Walsh, 623 F.2d 489, 495 [7th Cir.],
cert. denied, 449, U.S. 994, 101 S.Ct. 531, 66 L.Ed. 2d 291 [1980]; In
re Grand Jury Investigation [Tinari], 631 F.2d 17, 19 [3d Cir 1980];
cert.
denied, 449 U.S. 1083, 101 S.Ct. 869, 66 L.Ed. 2d 808 [1981]; In re
Grand
Jury Proceedings [Lawson], 600 F.2d 215, 218 [9th Cir. 1979]; United
States
v. Friedman, 445 F.2d 1076, 1086 [9th Cir. 1971]. See also: Clark v.
United
States, 289 U.S. 1, 15, 53, S.Ct. 465, 469, 77, L.Ed. 993 [1933]; In re
Grand Jury Proceedings [Pavlick], 680 F.2d 1026, 1028-29 [5th Cir.
1982,
En Banc].cralaw:red
Another exception
to the general rule that the
identity of a client is not privileged arises where disclosure of the
identity
would be tantamount to disclosing an otherwise protected confidential
communication.
In Baird, supra, the Ninth Circuit observed:
If the identification of the client conveys
information
which ordinarily would be conceded to be part of the usual privileged
communication
between attorney and client, then the privilege should extend to such
identification
in the absence of another factors.cralaw:red
Id., 279
F.2d at 632. Citing Baird, the
Fourth Circuit promulgated the following exception:
To the general rule is an exception,
firmly
embedded
as the rule itself. The privilege may be recognized where so much of
the
actual communication has already been disclosed that identification of
the client amounts to disclosure of a confidential communication.
NLRB v. Harvey,
349 F.2d 900, 905 [4th Cir. 1965].
Accord: United States v. Tratner, 511 F.2d 248, 252 [7th Cir. 1975];
Colton
v. United States, 306 F.2d 633, 637 [2d Cir. 1962], cert. denied, 371
U.S.
951, 83 S.Ct. 505, 9 L.Ed.2d 499 [1963]; Tillotson v. Boughner, 350
F.2d
663, 666 [7th Cir. 1965]; United States v. Pape, 144 F.2d 778, 783 [2d
Cir. 1944]. See also: Chirac v. Reinecker, 24 U.S. [11 Wheat] 280, 6
L.Ed.
474 [1826]. The Seventh Circuit has added to the Harvey exception the
following
emphasized caveat:
The privilege may be recognized where so
much
of the actual communication has already been disclosed [not necessarily
by the attorney, but by independent sources as well] that
identification
of the client [or of fees paid] amounts to disclosure of a confidential
communication.
United States
vs. Jeffers, 532 F.2d 1101, 1115 (7th
Cir. 1976 [emphasis added]). The Third Circuit, applying this
exception,
has emphasized that it is the link between the client and the
communication,
rather than the link between the client and the possibility of
potential
criminal prosecution, which serves to bring the client's identity
within
the protective ambit of the attorney-client privilege. See: In re Grand
Jury Empanelled February 14, 1978 [Markowitz], 603 F.2d 469, 473 n. 4
[3d
Cir. 1979]. Like the "legal advice" exception, this exception is also
firmly
rooted in principles of confidentiality.
Another
exception, articulated in the Fifth Circuit's
en banc decision of In re Grand Jury Proceedings [Pavlick], 680 F.2d
1026
[5th Cir. 1982 (En Banc]), is recognized when disclosure of the
identity
of the client would provide the "last link" of evidence:
We have long recognized the general rule
that
matters involving the payment of fees and the identity of clients are
not
generally privileged. In re Grand Jury Proceedings, [United States v.
Jones),
517 F.2d 666 [5th Cir. 1975]; see cases collected id. at 670 n.
2. There we also recognized, however, a limited and narrow exception to
the general rule, one that obtains when the disclosure of the client's
identity by his attorney would have supplied the last link in an
existing
chain of incriminating evidence likely to lead to the client's
indictment.
I join the
majority in holding that the Sandiganbayan
committed grave abuse of discretion when it misdelineated the metes and
bounds of the attorney-client privilege by failing to recognize the
exceptions
discussed above.
Be that as it
may, I part ways with the majority
when it ruled that petitioners need not prove they fall within the
exceptions
to the general rule. I respectfully submit that the attorney-client
privilege
is not a magic mantra whose invocation will ipso facto and ipso jure
drape
he who invokes it with its protection. Plainly put, it is not enough to
assert the privilege.[11]
The person claiming the privilege or its exceptions has the obligation
to present the underlying facts demonstrating the existence of the
privilege.[12]
When these facts can be presented only by revealing the very
information
sought to be protected by the privilege, the procedure is for the
lawyer
to move for an inspection of the evidence in an in camera
hearing.[13]
The hearing can even be in camera and ex-parte. Thus,
it
has been held that "a well-recognized means for an attorney to
demonstrate
the existence of an exception to the general rule, while simultaneously
preserving confidentiality of the identity of his client, is to move
the
court for an in camera ex-parte hearing.[14]
Without the proofs adduced in these in camera hearings, the
Court
has no factual basis to determine whether petitioners fall within any
of
the exceptions to the general rule.cralaw:red
In the case at
bar, it cannot be gainsaid that
petitioners have not adduced evidence that they fall within any of the
above-mentioned exceptions for as aforestated, the Sandiganbayan did
not
recognize the exceptions, hence, the order compelling them to reveal
the
identity of their client. In ruling that petitioners need not further
establish
the factual basis of their claim that they fall within the exceptions
to
the general rule, the majority held:
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].
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
word
of Baird, "that would inevitably form the chain of testimony necessary
to convict the [Client] of a crime.
I respectfully
submit that the first and third exceptions
relied upon by the majority are not self-executory but need factual
basis
for their successful invocation. The first exception as cited by the
majority
is "where a strong probability exists that revealing the clients'
name would implicate that client in the very activity for which he
sought
the lawyer's advice." It seems to me evident that "the very activity
for
which he sought the lawyer's advice" is a question of fact which must
first
be established before there can be any ruling that the exception can be
invoked. The majority cites Ex Parte Enzor,[15]
andU S v. Hodge and Zweig,[16]
but these cases leave no doubt that the "very activity" for which the
client
sought the advice of counsel was properly proved. In both cases, the
"very
activity" of the clients reveal they sought advice on their criminal
activities.
Thus, in Enzor, the majority opinion states that 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."[17]
In Hodge, the "very activity" of the clients deals with illegal
importation
of drugs. In the case at bar, there is no inkling whatsoever about the
"very activity" for which the clients of petitioners sought their
professional
advice as lawyers. There is nothing in the records that petitioners
were
consulted on the "criminal activities" of their client. The complaint
did
allege that petitioners and their client conspired to commit crimes but
allegations are not evidence.
So it is with the
third exception which as related
by the majority is "where the government's lawyers have no case against
an attorney's client unless, by revealing the client's name, the said
name
would furnish the only link that would form the chain of testimony
necessary
to convict an individual of a crime."[18]
Again, the rhetorical questions that answer themselves are: [1] how can
we determine that PCGG has "no case" against petitioners without
presentation
of evidence? and [2] how can we determine that the name of the client
is
the only link without presentation of evidence as to the other links?
The
case of Baird vs. Koerner[19]
does not support the "no need for evidence" ruling of the majority. In
Baird, as related by the majority itself, "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 US Internal
Revenue
Service [IRS]. It appeared that the taxpayers' returns of previous
years
were probably incorrect and the taxes understated.[20]
Once more, it is clear that the Baird court was informed of the
activity
of the client for which the lawyer was consulted and the activity
involved
probable violation of the tax laws. Thus, 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 tax 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.
In fine, the
factual basis for the ruling in Baird
was properly established by the parties. In the case at bar, there is
no
evidence about the subject matter of the consultation made by
petitioners'
client. Again, the records do not show that the subject matter is
criminal
in character except for the raw allegations in the Complaint. Yet, this
is the unstated predicate of the majority ruling that revealing the
identity
of the client "would furnish the only link that would form the chain of
testimony necessary to convict an individual of a crime." The silent
implication
is unflattering and unfair to petitioners who are marquee names in the
legal profession and unjust to their undisclosed client.
Finally, it ought
to be obvious that petitioners'
right to claim the attorney-client privilege is resolutory of the
Complaint
against them, and hence, should be decided ahead and independently of
their
claim to equal protection of the law. Pursuant to the rule in legal
hermeneutics
that courts should not decide constitutional issues unless unavoidable,
I also respectfully submit that there is no immediate necessity to
resolve
petitioners' claim to equal protection of the law at this stage of the
proceedings.cralaw:red
IN VIEW WHEREOF,
I respectfully register a qualified
dissent from the majority opinion.cralaw:red
___________________________________
Endnotes
[1]
Agricultural Consultancy Services, Inc.; Agricultural Investors, Inc.;
Anglo Ventures, Inc.; Archipelago Realty Corporation; AP Holdings,
Inc.;
ARC Investment, Inc. ASC Investment, Inc.; Autonomous Development
Corporation;
Balete Ranch, Inc.; Black Stallion Ranch, Inc.; Cagayan de Oro Oil
Company,
Inc.; Christenses Plantation Company; Cocoa Investors, Inc.; Coconut
Investment
Company [CIC]; COCOFED Marketing Corporation [COCOMARK] Coconut Davao
Agricultural
Aviation, Inc.; Discovery Realty Corporation; Dream Pastures, Inc.;
Echo
Ranch, Inc.; ECJ and Sons Agricultural Management, Inc.; Far East
Ranch,
Inc.; Filso v Shipping Co. Inc.; First Meridian Development, Inc.;
First
United Transport, Inc.; Granexport Manufacturing Corporation; Habagat
Realty
Development, Inc.; Hyco Agricultural, Inc.; Iligan Coconut Industries,
Inc.; Kalawakan Resorts, Inc.; Kaunlaran Agricultural Corporation;
Labayog
Air Terminals, Inc.; Landair International Marketing Corporation;
Legaspi
Oil Co., Inc.; LHL Cattle Corporation; Lucena Oil Factory, Inc.; Meadow
Lark Plantation, Inc.; Metroplex Commodities, Inc.; Misty Mountains
Agricultural
Corporation; Northern Carriers Corporation; Northwest Contract Traders,
Inc.; Ocean Side Maritime Enterprises, Inc.; Oro Verde Services;
Pastoral
Farms, Inc.; PCY Oil Manufacturing Corporation; Philippine Coconut
Producers
Federation, Inc.; [(COCOFED) as an entity and in representation of the
"so-called more than one million member-coconut farmers"]; Philippine
Radio
Corporation, Inc.; Philippine Technologies, Inc.; Primavera Farms,
Inc.;
Punong-Bayan Housing Development Corp.; Pura Electric Co., Inc.; Radio
Audience Developers Integrated Organization, Inc.; Radio Pilipino
Corporation;
Rancho Grande, Inc.; Randy Allied Ventures, Inc.; Reddee Developers,
Inc.;
Rocksteel Resources, Inc.; Roxas Shares, Inc.; San Esteban Development
Corporation; San Miguel Corporation Officers Incorporation; San Pablo
Manufacturing
Corporation; Southern Luzon Oil Mills, Inc.; Silver Leaf Plantation,
Inc.;
Soriano Shares, Inc.; Southern Services Traders, Inc.; Southern Star
Cattle
Corporation; Spade 1 Resorts Corporation; Tagum Agricultural
Development
Corporation; Tedeum Resources, Inc.; Thilagro Edible Oil Mills Inc.;
Toda
Holdings Inc.; United Coconut Oil Mills, Inc.; United Coconut Planters
Life Assurance Corporation [COCOLIFE]; Unexplored Land Developers,
Inc.;
Valhalla Properties Inc.; Verdant Plantations, Inc.; Vesta Agricultural
Corporation; and Wings Resort Corporation.
[2]
Petition in G. R. No. 105938; Rollo, p. 6.
[3]
Id., Annex "B"; Rollo, p. 45.
[4]
Id., Annex "C"; Rollo, p. 143.
[5]
Id., Annex "A"; Rollo, p. 39.
[6]
Id., Annex "A"; Rollo, p. 39.
[7]Petitioner
in G. R. No. 108113, Annexes "E"; Rollo, p. 161.
[8]
Id., Annex "D"; Rollo, p. 145.
[9]
Petition in G. R. No. 105938, Annex "E"; Rollo, p. 161.
[10]
Id., Annexes, "G", "H" and "I"; Rollo, pp. 191-196.
[11]
Id.; Rollo, p. 8.
[12]
Id., Annex "K", p. 222.
[13]
Rollo, p. 303.
[14]
Id., at 285.
[15]
Id., at 287.
[16]
Annex "F"; Rollo, pp. 181-182.
[17]
Coquia, Jorge, Principles of Roman Law [Manila: Central Law Book
Supply,
Inc., 1979], p. 116.
[18]
Id., at 122.
[19]
Kelly v. Judge of Recorders' Court [Kelly v. Boyne], 239 Mich. 204, 214
NW 316, 53 A.L.R. 273; Rhode Island Bar Association v. Automobile
Service
Association, 179 A. 139, 100 ALR 226.
[20]
Curtis v. Richards, 95 Am St. Rep. 134; also cited in Martin, Ruperto,
Legal and Judicial Ethics [Manila, Premium Printing Press, 1988] at p.
90.
[21]
Rhode Island Bar Association v. Automobile Service Association, 100 ALR
226; Cooper v. Bell, 153 SW 844; Ingersoll v. Coal Creek Co., 98 SW
173;
Armstrong v. 163 NW 179; Re Mosness, 20 Am. Rep. 55.
[22]
Re Paschal [Texas v. White] 19 L. Ed. 992; Stockton v. Ford, 11 How.
[U.S.]
232; 13 L. Ed. 676; Berman v. Cookley, 137 N -E- 667; 26v ALR 92; Re
Dunn
98 NE 914.
[23]
Agpalo, Ruben, Legal Ethics [Manila: Rex Book Store, 1992], p. 136.
[24]
Hilado v. David, 84 Phil. 569; Hernandez v. Villanueva, 40 Phil. 775.
[25]
C. Wolfram, Modern Legal Ethics, 146 [1986].
[26]
52 U. S. [11 How.] 232, 247, 13 L. Ed. 676 [1850].
[27]
Ibid.
[28]
Act No. 190, Sec. 383.
[29]
Rules of Court, Rule 130, Sec. 24 [b].
[30]
People v. Warden of Country Jail, 270 NYS 362 [1934].
[31]
58 AmJur 2d, Witnesses Sec. 507, 285.
[32]
Id.
[33]
5 Wigmore on Evidence, Sec. 23 13, pp. 607-608. See also, U. S. v.
Flores,
628 F2d 521; People v. Doe, 371 N.E. 2d. 334.
[34]
270 ALA 254 [1960].
[35]
548 F 2d 1347 [9th Cir. 197].
[36]
Id. [Citations omitted].
[37]
249 NYS 631 [1931].
[38]
Id., at 632.
[39]
Id., at 634.
[40]
87 NYS 1059 [1904].
[41]
Id.
[42]
279 F. 2d 623 [1960].
[43]
Id., at 633.
[44]
Supra, note 20, at 257.
[45]
R. Aronson, Professional Responsibility, 203 [1991].
[46]
Hays v. Wood, 25 Cal. 3d 770, 603 P. 2d 19, 160 Cal. Rptr. 102 [1979];
Ex-parte McDonough, 180 Cal. 230, 149 P. 566 [1915]; In re Grand Jury
Proceedings,
600 F. 2d 215, 218 [9th Cir. 1979]; United States v. Hodge & Zweig,
548 F. 2d 1347, 1353 [9th Cir. 1977]; In re Michaelson, 511 F. 2d 882,
888 [9th Cir.], Cert. Denied, 421 U.S. 978, 95 S. Ct. 1979, 44 L Ed. 2d
469 [1975]; Baird v. Koerner, 279 F. 2d 623, 634-35 [9th Cir. 1960]
(Applying
California law); United States v. Jeffers, 532 F. 2d 1101, 114 15 [7th
Cir. 1976]; Affirmed in part and vacated in part, 432 U.S. 137, 97 S.
Ct.
2207, 53 L. Ed. 2d 168 [1977]; In re Grand Jury Proceedings, 517 F. 2d
666, 670 71 [5th Cir. 1975]; Tillotson v. Boughner, 350 F. 2d, 663,
665-66
[7th Cir. 1965]; NLRB v. Harvey, 349 F. 2d 900, 905 [4th Cir. 1965];
Colton
v. United States, 306 F. 2d 633, 637 [2d Cir. 1962], Cert. Denied, 371
U.S. 951, 83 S Ct. 505, 9 L. Ed.2d 499 [1963].
[47]
Baird v. Koerner, supra. The general exceptions to the rule of
privilege
are: "(a) Communications for illegal purposes, generally; (b)
Communications
as to crime; and (c) Communications as to fraud." 58 Am Jur 515-517. 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.
This includes contemplated criminal acts or in aid or furtherance
thereof.
But, "statements and communications regarding the commission of a crime
already committed, made by the party who committed it to an attorney,
consulted
as such are, of course privileged communications, whether a fee has or
has not been paid. "Id. In such instances even the name of the client
thereby
becomes privileged.
[48]
58 Am Jur 515-517.
[49]
Supra, Note 40.
[50]
Bacon v. Frisbie, 80 NY 394, 399.
[51]
517 F. 2d 66 6, 671 [5th Cir., 1965].
[52]
350 F. 2d 663 [7th Cir., 1965].
[53]
See, In re Shawmut Mining Co., 87 N.Y.S. 1059 [1904].
[54]
US Case No. 491, 93-7418 [1994].
[55]
US Case No. 92-2439 [1993].
[56]
249 NY 458 [1920].
[57]Lorenzana
Food Corporation v. Daria, 197 SCRA 428.
[58]
Lerner, Max, The Mind and Faith of Justice Holmes [New York; Halcyon
House,
Garden City, 1943], p. 28.
[59]
Rollo; p. 164
[60]
Id., at 155.
[61]
As manifested by the PCGG, the following documents constituted the
basis
for the PCGG's decision to drop private respondent: (1)
A letter to the PCGG dated 24 May 1989 signed by Mr. Augusto Sanchez,
as
counsel for Mr. Roco reiterating an earlier request for reinvestigation
of the case;
(2) An affidavit dated 8
March
1989 signed and executed by Mr. Roco which was an enclosure to the
letter
of 24 May 1989; (3) A letter to the PCGG
dated
21 September 1988 by the Roco, Bunag and Kapunan Law offices, which was
the original request for reinvestigation and/or reexamination of the
evidence
in the possession of the PCGG; Rollo, p. 238.
[62]
Gumabon v. Director of Prisons, 37 SCRA 420 [1971].
[63]
Id.
[64]
Article III, Section 1 of the Constitution provides:chanroblesvirtuallawlibrary
Sec. 1. No person shall
be
deprived
of life, liberty, or property without due process of law; nor shall any
person be denied the equal protection of the laws.
______________________________________
PUNO, J.,
Dissenting:
[1]
8 J. Wigmore, Evidence, S. 2290 [McNaughton Rev. 1961].
[2]
In re Selser 15 N.J. 393, 405-406, 105 A. 2d 395, 401-402 [1954].
[3]
See Note, Professional Responsibility and In re Ryder: Can Attorney
Serve
Two Masters? 54 Va. L. Rev. 145 [1968].
[4]
United States v. Nixon, 418 US 683, 710, 94 S.Ct. 3090, 41 L.Ed. 2d
1039
[1974].
[5]
In re Grand Jury Investigation No. 83-2-35, 83-1290, 723 F2d. 447
[1983]
Citing In re Walsh, 623 F2d 489, Cert. Denied 449 US 994, 101 S.Ct.
531,
66 L.Ed.2d 291 [1980]; Fisher v. United States, 425 US 391, 96 S.Ct.
1569,
48 L.Ed.2d 39 [1975].
[6]
125 American Law Reports Annotated, 516-519 citing People v. Van
Alstine,
57 Mich 69, 23 NW 594.
[7]
Millare v. Montero, 246 SCRA 1.
[8]
81 Am Jur 2d. Witnesses, Section 395, pp. 356-357.
[9]
289 US 1 [1933].
[10]
Op Cit.
[11]
Hoffman v. United States, 341 US 479, 71 S. Ct. 814, 95 L.ed. 118
[1951].
[12]
US, et al. v. Tratner, 511 F., 2d, 248-255 [1975]; US v. Landoff, 591 F
2d 36 [1978]; US v. Bartlett, 449 F 2d 700 [1971]; cert. denied, 504 US
932, 92 S-Ct. 990, 30 L.ed. 2d 808 [1972].
[13]
US v. Tratner, op cit., p. 252 citing US v. Johnson, 465 F2d 793 [1972].
[14]
In re Grand Jury Investigation No. 83-2-35, 723 F2d 446 [1983].
[15]
270 ALA 254 [1960].
[16]
548 F2d 1347 [9th Cir. 197].
[17]
See page 25 of Majority Decision.
[18]
See page 31 of Majority Decision.
[19]
279 F2d 623 [1960].
[20]
See pp. 31-32 of Majority Decision. |