SECOND DIVISION
ELNORA R. CORTES
AND EDMUNDO CORTES,
Petitioners,
G.R.
No.
121772
January 13, 2003
-versus-
COURT OF APPEALS,
F. S. MANAGEMENT
& DEVELOPMENT
CORP. AND FELIX MOYA,
Respondents.
D E C I S I O N
AUSTRIA-MARTINEZ,
J.:
Before us is a petition
for review on certiorari
under Rule 45 of the Rules of Court seeking to
set aside the Decision of the Court of Appeals dated March 17, 1995[1],
the dispositive portion of which reads:chanrobles virtuallaw libraryred
WHEREFORE, premises
considered, the appealed Order dated July 16, 1992 is hereby AFFIRMED
with
modification. Appellants spouses Cortes in addition to the P100,000.00
is further ORDERED to pay six percent (6%) per annum legal interest of
such amount from July 25, 1992 until fully paid.chanrobles virtuallaw libraryred
Cost against appellants
spouses Cortes.cralaw:red
SO ORDERED.[2]
The controversy stemmed
from a civil case for specific performance with damages filed by F.S.
Management
and Development Corporation (FSMDC) against spouses Edmundo and Elnora
Cortes involving the sale of the parcel of land owned by the said
spouses.[3]
Spouses Cortes retained
the professional services of Atty. Felix Moya for the purpose of
representing
them in said case. However, they did not agree on the amount of
compensation
for the services to be rendered by Atty. Moya.chanrobles virtuallaw libraryred
Before a full-blown
trial could be had, defendants spouses Cortes and plaintiff FSMDC
decided
to enter into a compromise agreement. On June 4, 1991, defendants
spouses
received from plaintiff FSMDC, three checks totaling P2,754,340.00
which
represents the remaining balance of the purchase price of the subject
land.cralaw:red
On June 7, 1991, Atty.
Moya filed an "Urgent Motion to Fix Attorney’s Fees, Etc." praying that
he be paid a sum equivalent to thirty-five percent (35%) of the amount
received by the defendants spouses[4]
which the latter opposed contending that the amount Atty. Moya seeks to
recover is utterly excessive and is not commensurate to the nature,
extent
and quality of the services he had rendered.[5]chanrobles virtuallaw libraryred
On July 2, 1991, the
Cortes spouses and Atty. Moya settled their differences by agreeing in
open court that the former will pay the latter the amount of
P100,000.00
as his attorney’s fees. Pursuant to such agreement, the trial court
issued
an order of even date which reads as follows:
Parties in open Court
agreed to movant’s attorney’s fees of P100,000.00 to be paid out of any
check paid by the plaintiff to defendants.cralaw:red
Not later than July
15, 1991, parties are hereby ordered to inform the Court whether or not
this is complied with, so the Court can act accordingly.cralaw:red
SO ORDERED.[6]
Subsequently, the Cortes
spouses terminated the services of Atty. Moya and retained the services
of another lawyer.
On January 8, 1992,
or about six months after the afore-quoted Order, Atty. Moya filed an
Ex-Parte
Manifestation praying that his Motion to Fix Attorney’s Fees be
resolved
on the basis of the agreement of the parties "in chambers".[7]chanrobles virtuallaw libraryred
The Cortes spouses filed
their Comment claiming:
"1. That they agreed
to the settlement of P100,000.00 attorney’s fees expecting that the
checks
paid by plaintiff by way of settlement will be good and may be encashed
by them but it turned out that they were all dishonored, and no
compromise
agreement was pushed through;chanrobles virtuallaw libraryred
2. That defendants are
willing to pay Atty. Moya as additional compensation for his services
only
in the amount of P50,000.00 subject to the condition that same shall be
paid after the case is terminated in their favor and/or the property
involved
is sold;chanrobles virtuallaw libraryred
3. That defendants shall
compensate Atty. Moya said amount in addition to what they have paid
before."[8]
On June 26, 1992, Atty.
Moya filed a "Motion for Early Resolution of Pending Incidents and to
Order
Defendants to Pay Their Previous Counsel".[9]
On July 16, 1992, the
trial court issued an Order directing the Cortes spouses to pay Atty.
Moya
the sum of P100,000.00 as and by way of attorney’s fees.[10]
The Cortes spouses filed a Notice of Appeal to the Court of Appeals.[11]
On July 31, 1992, Atty. Moya filed an "Ex-Parte Motion to Dismiss
Defendant’s
Appeal" which was denied by the trial court in its Order dated August
4,
1992.[12]
Consequently, he filed a notice of appeal questioning the Orders of the
trial court dated July 16, 1992 and August 4, 1992.[13]
On March 17, 1995, the
Court of Appeals rendered the herein assailed decision resolving the
respective
appeals of spouses Cortes and Atty. Moya in favor of the latter.[14]
Spouses Cortes moved for the reconsideration of the decision of the
appellate
court which the Court denied in its Resolution issued on August 30,
1995.[15]
Hence, herein petition
filed by the Cortes spouses, raising the following issues:chanrobles virtuallaw libraryred
"1. Whether the award
of P100,000.00 in favor of private respondent as and by way of
attorney’s
[fees] for the handling of petitioners’ case before the services of the
former was legally terminated is tenable under the facts of this case.cralaw:red
2 Whether the respondent
Honorable Court of Appeals misapplied the principle of Estoppel in this
case."[16]
As both issues are interrelated,
we shall resolve them jointly.chanrobles virtuallaw libraryred
Petitioners spouses
claim that they have already paid private respondent Moya the total
amount
of P36,000.00 in acceptance and appearance fees.[17]
However, a perusal of the records shows that no competent evidence,
oral
or documentary, was presented to prove said claim. It is settled that
he
who alleges a fact has the burden of proving it; that mere allegation
is
not evidence.[18]
Besides, records show that the alleged payment by petitioners of said
amount
was never raised before the lower court. It was only raised on appeal
with
respondent appellate court. Settled is the rule that litigants cannot
raise
an issue for the first time on appeal as this would contravene the
basic
rules of fair play and justice.[19]chanrobles virtuallaw libraryred
Nevertheless, petitioners’
main contention is that the award of P100,000.00 to private respondent
Moya as and by way of attorney’s fees "is unconscionable and
unreasonable."
On its face, the Order
dated July 2, 1991 appears to be explicit and leaves no room for any
other
interpretation. The first paragraph of said Order states that parties
in
open Court agreed that the attorney’s fees in the amount of P100,000.00
shall be paid out of any check paid by the plaintiff to defendants.[20]
The said agreement is therefore in the nature of a compromise agreement.cralaw:red
However, petitioners
contend that they agreed to pay private respondent P100,000.00 out of
the
three (3) checks paid by FSMDC on June 4, 1991 and not out of any other
check issued by FSMDC. This contention finds support in the prayer of
private
respondent, Atty. Moya himself, in his Urgent Motion to Fix Attorney’s
Fees, Etc.- explicitly asking that he "be paid immediately upon the
encashment
of the P1,000,000.00 check dated June 10, 1991 by the defendants". He
even
expressed concern that he "may not be paid the corresponding attorney’s
fees out of the check that is due for payment on said date".[21]
Clearly therefrom, the amount of P100,000.00 due to Atty. Moya was
expected
to be taken not from any check paid by FSMDC to petitioners but
specifically
from the check dated June 10, 1991 given to petitioners spouses.chanrobles virtuallaw libraryred
As already stated, the
Order in question appears to be a compromise agreement between spouses
Cortes and Atty. Moya. It is true that under the doctrine of estoppel,
an admission or representation is rendered conclusive upon the person
making
it, and cannot be denied or disproved as against the person relying
thereon.[22]
A party may not go back on his own acts and representations to the
prejudice
of the other party who relied upon them.[23]
But, in technical estoppel, the party to be estopped must knowingly
have
acted so as to mislead his adversary, and the adversary must have
placed
reliance on the action and acted as he would otherwise not have done.[24]
In the present case,
petitioners had evidently agreed to pay private respondent P100,000.00
out of the checks paid by FSMDC on June 4, 1991. However, the trial
court
ordered the payment to be sourced out of any check paid by FSMDC to
petitioners.
Yet, it does not appear from the original records that both the
petitioners
and the private respondent were actually sent copies of the Order of
July
2, 1991. Thus, petitioners spouses were deprived of the opportunity to
question the content of the Order on ground of mistake or excusable
negligence,
pursuant to the remedy provided for under Section 1, Rule 38 of the
Rules
of Court. Since petitioners did not receive a copy of the said Order
they
could not therefore be considered as having knowingly agreed to it as
to
mislead the court or the private respondent into believing that they
unconditionally
acceded to pay private respondent the amount of P100,000.00 out of any
check given by FSMDC. Consequently, they are not estopped from
questioning
the correctness of such Order. Elementary fairness dictates that
petitioners,
who were unaware of the questioned Order, should not be estopped from
questioning
the same.chanrobles virtuallaw libraryred
Having disposed of the
issue on estoppel, we now turn to the question of whether or not the
amount
of P100,000.00 awarded to the private respondent is in consonance with
the prevailing principles and guidelines governing compensation due to
attorneys for the professional services they have rendered.cralaw:red
The reasonableness of
the amount of attorney’s fees awarded to private respondent should be
properly
gauged on the basis of the long-standing rule of quantum meruit,
meaning,
"as much as he deserves". Where a lawyer is employed without agreement
as to the amount to be paid for his services, the courts shall fix the
amount on quantum meruit basis. In such a case, he would be entitled to
receive what he merits for his services.[25]
In this respect, Section 24, Rule 138 of the Rules of Court provides:
"Sec. 24. Compensation
of attorneys, agreement as to fees. - An attorney shall be entitled to
have and recover from his client no more than a reasonable compensation
for his services, with a view to the importance of the subject matter
of
the controversy, the extent of the services rendered, and the
professional
standing of the attorney. x x x"
In addition, the following
circumstances, codified in Rule 20.1, Canon 20 of the Code of
Professional
Responsibility, serves as a guideline in fixing a reasonable
compensation
for services rendered by a lawyer on the basis of quantum meruit:chanrobles virtuallaw libraryred
a) The time spent and the extent of the services rendered or required;
b) The
novelty and difficulty of the questions involved;
c) The
importance of the subject matter;
d) The
skill demanded;chanrobles virtuallaw libraryred
e) The
probability of losing other employment as a result of acceptance of the
proffered case;
f) The
customary charges for similar services and the schedule of fees of the
IBP chapter to which he belongs;
g) The
amount involved in the controversy and the benefits resulting to the
client
from the services;
h) The
contingency or certainty of compensation;
i) The
character of the employment, whether occasional or established; and
j) The
professional standing of the lawyer.
In the present case,
aside
from invoking his professional standing, private respondent claims that
he was the one responsible in forging the initial compromise agreement
wherein FSMDC agreed to pay P2,754,380.00. The fact remains, however,
that
such agreement was not consummated because the checks given by FSMDC
were
all dishonored. It was not the private respondent who was responsible
in
bringing into fruition the subsequent compromise agreement between
petitioners
and FSMDC.
Nonetheless, it is undisputed
that private respondent has rendered services as counsel for the
petitioners.
He prepared petitioners’ Answer and Pre- Trial Brief, appeared at the
Pre-Trial
Conference, attended a hearing held on July 13, 1990, cross-examined
the
witness of FSMDC, and was present in the conference at the Manila Hotel
between the parties and their respective counsels. All these services
were
rendered in the years 1990 and 1991 where the value of a peso is
higher.
Thus, we find the sum of P100,000.00 awarded to private respondent as
his
attorney’s fees to be disproportionate to the services rendered by him
to petitioners.cralaw:red
The amount of P50,000.00
as compensation for the services rendered by Atty. Moya is just and
reasonable.cralaw:red
Besides, the imposition
of legal interest on the amount payable to private respondent is
unwarranted.
Article 2209[26]
of the Civil Code invoked by Atty. Moya and cited by the appellate
court,
finds no application in the present case. It is a provision of law
governing
ordinary obligations and contracts. Contracts for attorney’s services
in
this jurisdiction stand upon an entirely different footing from
contracts
for the payment of compensation for any other services.[27]chanrobles virtuallaw libraryred
We have held that lawyering
is not a moneymaking venture and lawyers are not merchants.[28]
"Law advocacy x x x
is not capital that yields profits. The returns it births are simple
rewards
for a job done or service rendered. It is a calling that, unlike
mercantile
pursuits which enjoy a greater deal of freedom from government
interference,
is impressed with a public interest, for which it is subject to State
regulation."[29]
Thus, a lawyer’s compensation
for professional services rendered are subject to the supervision of
the
court, not just to guarantee that the fees he charges and receives
remain
reasonable and commensurate with the services rendered, but also to
maintain
the dignity and integrity of the legal profession to which he belongs.[30]
WHEREFORE, the decision
appealed from is AFFIRMED WITH MODIFICATIONS to the effect that the
attorney’s
fees awarded to private respondent Felix Moya is REDUCED to P50,000.00
and the legal interest of 6% per annum imposed by the Court of Appeals
on the amount due to respondent Moya is DELETED.cralaw:red
No costs.chanrobles virtuallaw libraryred
SO ORDERED.cralaw:red
Bellosillo, J.,
(Chairman),
Mendoza, Quisumbing, and Callejo, Sr., JJ., concur.chan
robles virtual law library
____________________________
Endnotes:
[1]
In CA G.R. CV No. 41779, entitled, "F.S. Management and Development
Corporation,
Plaintiffs, vs. Elnora R. Cortes and Edmundo Cortes,
Defendants-Appellants;
Felix L. Moya, Movant-Appellant."
[2]
CA Rollo, p. 90
[3]
Docketed as Civil Case No. TG-1125.
[4]
Original Records, p. 90.
[5]
OR, p. 98.
[6]
OR, p. 110.
[7]
OR, p. 118.
[8]
OR, p. 123.
[9]
OR, p. 142.
[10]
OR, p. 144.
[11]
OR, p. 145.
[12]
OR, pp. 147 and 151.
[13]
OR, p. 150.chanrobles virtuallaw libraryred
[14]
CA Rollo, p. 82.
[15]
CA Rollo, p. 119.
[16]
Petition for Review on Certiorari, p. 18, Rollo; Memorandum for the
Petitioners,
p. 123, Rollo.
[17]
Petition for Review on Certiorari, p. 19, Rollo; Brief for
Oppositor-Appellants,
pp. 25-26, CA Rollo.
[18]
Marubeni Corporation, et. al. vs. Felix Lirag, G.R. No. 130998, August
10, 2001; Sadhwani vs. Court of Appeals 281, SCRA 75, 87.
[19]
Sumbad vs. Court of Appeals, 308 SCRA 575, 596; Cojuangco, Jr. vs.
Court
of Appeals, 309 SCRA 602, 614; PAMECA Wood Treatment Plant, Inc. vs.
Court
of Appeals, 310 SCRA 281; Ysmael vs. Court of Appeals, 318 SCRA 215,
227.
[20]
Original Records, p. 110.
[21]
OR, p. 90.chanrobles virtuallaw libraryred
[22]
Ducat vs. Court of Appeals, 322 SCRA 695.
[23]
Laureano Investment and Development Corporation vs. Court of Appeals,
272
SCRA 253, 263 citing Caltex (Philippines), Inc. vs. Court of Appeals,
212
SCRA 448, 457.
[24]
Maglucot-Aw vs. Maglucot, 329 SCRA 78.
[25]
Traders Royal Bank Employees Union-Independent vs. NLRC, 269 SCRA 733,
751 citing Sesbreño vs. Court of Appeals, 245 SCRA 30; Lorenzo
vs.
Court of Appeals, 189 SCRA 260.
[26]
Art. 2209. If the obligation consists in the payment of a sum of money,
and the debtor incurs in delay, the indemnity for damages, there being
no stipulation to the contrary, shall be the payment of the interest
agreed
upon, and in the absence of stipulation, the legal interest, which is
six
percent per annum.
[27]
Mambulao Lumber Co. vs. Philippine National Bank, 22 SCRA 359, 371.
[28]
Canon 12, Canons of Professional Ethics.chanrobles virtuallaw libraryred
[29]
Metropolitan Bank & Trust Company vs. Court of Appeals, 181 SCRA
367,
377 citing Canlas vs. Court of Appeals, 164 SCRA 160.
[30]
Sumaoang vs. Judge, RTC, Br. XXXI, Guimba, Nueva Ecija, 215 SCRA 136,
143. |