Philippine Supreme Court Resolutions > Year 2008 > September 2008 Resolutions > [A.C. No. 7904 : September 22, 2008] RHODORA B. YUTUC V. ATTY. DANIEL RAFAEL B. PENUELA :

Quoted hereunder, for your information, is a resolution of this Court dated 22 September 2008:

A.C. No. 7904 (Rhodora B. Yutuc v. Atty. Daniel Rafael B. Penuela)

Complainant Rhodora B. Yutuc charges Atty. Daniel Rafael B. Penuela with misconduct and negligence and seeks his disbarment.

In her sworn complaint, with enclosures, Yutuc alleged that on November 22, 2005, she engaged the services of Penuela to handle, for an agreed fee of PhP 50,000, an ejectment case against the occupants of her parents' property in Kabangkalan City, Negros Occidental. For the purpose, she executed a Special Power of Attorney (SPA) in favor of Penuela and gave him PhP 25,000 as advance attorney's fees. Yutuc further alleged that a year after returning from abroad where she was a resident, she learned that Penuela had yet to file the case. Her demand for the return of at least a part of the attorney's fees thus advanced went, according to her, unheeded.

In his answer filed in compliance with an order from the Integrated Bar of the Philippines (IBP) Commission on Bar Discipline, Penuela alleged that of the amount he received, PhP 20,000 represented his acceptance fee and the PhP 5,000 was to answer for filing fees, transportation, and other similar expenses. Explaining the non-filing of the ejectment suit, Penuela stated that, as of January 3, 2006, a demand letter to vacate had already been sent out, but he could not as yet file an ejectment case because a Declaration of Heirship was not yet in his possession. This document, so Penuela alleged, was a jurisdictional requirement per a Court of Appeals (CA) ruling he recently encountered.^[1] He also alleged telling Yutuc of the said requirement only on October 5, 2006 upon her return from abroad and explained, when asked, the reason why he was not able to contact Yutuc's son, Erwin, or Yutuc's attorney-in-fact, Bethel Esceller.

To the answer, Yutuc countered with a reply, to which Penuela filed a rejoinder.

Following the submission by the parties of their respective position papers, the Commission, thru Commissioner Antonio S. Tria, submitted an Investigation Report dated January 25, 2008 which the IBP Board of Governors later adopted and forwarded to this Court. In the report, the Commission recommended that Penuela be adjudged guilty of negligence in violation of Canon 16, Rule 16.01, and Canon 18, Rule 18.03 of the Code of Professional Responsibility respectively providing:

Canon 16, Rule 16.01.-A lawyer shall account for all money or property collected or received for or from the client.

Canon 16, Rule 18.03.-A lawyer shall not neglect a legal matter entrusted to him, and his negligence in connection therewith shall render him liable.

The Commission predicated its inculpatory finding on Penuela's conflicting statements respecting the fees he received, implying lack of candor on his part, inordinate delay, and failure to file the ejectment case for which he had already received an acceptance fee. The Commission recommended that Penuela be meted the penalty of one-year suspension from the practice of law.

The recommendation is well-taken.

Attorneys are expected to exercise due diligence on legal matters entrusted to them by their clients. Every case they accept deserves their full attention, diligence, and skill.^[2] They too owe it to the court, their clients, and other lawyers to be candid and fair.^[3] In this regard, the Rules of Court provides that a member may be suspended or removed from office as an attorney for any malpractice or misconduct in office.^[4] A scrutiny of the pleadings of both parties readily reveals Penuela's guilt for misconduct, negligence, and lack of candor. A period of one year after receipt of his acceptance fee is far too long a time for a lawyer to prepare and file a simple ejectment complaint. Recall that an SPA was executed as early as November 22, 2005 to enable Penuela to file the necessary complaint. His proffered excuse of still needing an extrajudicial Declaration of Heirship as a condition to such filing is disingenuous, to say the least. The alleged precedent CA decision, entitled Spouses Eduardo Gargar and Mismar Jumawan v. Milagros Ciocon and docketed as CA-G.R. CV No. 59005,^[5] Penuela cited as basis for requiring such declaration was promulgated on May 8, 2006, or some six (6) months after he agreed to accept the ejectment case. Penuela's act of superimposing a new date, April 21, 2006, over the date November 22, 2005, the original date of the SPA,^[6] was a crude but dishonorable attempt to mislead the Commission and eventually this Court.

Just as censurable was Penuela's bent on muddling the facts of the case. The following excerpts from the investigation report suggest as much:

In [respondent's] answer,^[7] the entire case was for the amount of Php 50,000.00, half of which was paid in cash. Yet in his rejoinder to the Reply,^[8] he makes a turn around and asserts that "the total amount of the package for the services of the undersigned respondent is not for the Amount of Fifty Thousand (Php 50,000.00) [P]esos but merely for the amount of Twenty Thousand (Php 20,000.00) Pesos as acceptance fee and the remaining amount that was yet to be paid of Twenty Five Thousand (Php 25,000.00) Pesos was intended for the expenses in the execution of the judgment and demolition of the houses of the supposed three (3) defendants."

Again, in his Position Paper, respondent asserts "The Parties agreed that the entire case was for the amount of Fifty thousand (Php 50,000.00) Pesos. Out of said amount Twenty Thousand (Php 20,000.00) Pesos will be the retainership/acceptance fee of counsel, Five Thousand (Php 5,000.00) Pesos will be used to cover filing fee, transportation fees, mailing, paper, reproduction, notarization and other related expenses." (Footnotes added.)

In all then, Penuela, after receiving an advance from Yutuc, has failed to render the legal services agreed upon. A reciprocal effort towards complying with his part of the bargain would have been becoming of Penuela, as a professional of good will. But that kind of gesture has already been overtaken by events. Penuela had shown, through his dealing with Yutuc involving the recovery of a piece of land from alleged illegal occupants, a want of due diligence and basic candor expected of members of the bar. We thus agree with the findings of the Commission as to Penuela's culpability, but not only for negligence. Accordingly, the Court hereby adopts the Commission's recommendation with modification that Penuela be made to account or return to complainant Yutuc the PhP 25,000 he received with legal interest from the time he received the same. Money entrusted to a lawyer for a specific purpose, such as for filing fee, but not used for failure to file the case, should be immediately returned.^[9] Once a lawyer accepts money from a client, an attorney-client relationship is established, giving rise to the duty of fidelity to the client's cause.^[10] The Code mandates that every lawyer shall hold in trust all funds of the client that may come into the lawyer's possession.^[11] Since he was not able to file the ejectment case, then reimbursement is proper to prevent unjust enrichment on the part of Penuela.

The records of the Bar Confidant indicate that Penuela does not have any record of administrative cases and sanctions against him. Accordingly, the recommended penalty of suspension from the practice of law for one (1) year would suffice to protect the interests of the public and the legal profession. The Court reiterates that the power to disbar must be exercised with great caution and only in clear cases of misconduct that seriously affect the standing and character of the lawyer as an officer of the court and a member of the bar.^[12] Considering the serious consequence of disbarment, said penalty shall be imposed only when the lawyer's misconduct constitutes a criminal act and/or is committed under revolting or scandalous circumstance as to shock the common sense of decency.^[13]

WHEREFORE, Atty. Daniel Rafael B. Penuela is adjudged GUILTY of misconduct, negligence, and lack of candor in the performance of his responsibilities to his client in violation of Canon 15, Canon 16, and Rule 18.03, Canon 18 of the Code of Professional Responsibility. He is hereby SUSPENDED from the practice of law for a period of one (1) year effective upon receipt of this Resolution. He is also ordered to return to complainant Rhodora B. Yutuc, the amount of PhP 25,000 with legal interest of six (6) percent per annum from the time of his receipt of the money on November 22, 2005 up to finality of this Resolution and twelve (12) percent per annum from finality thereof until paid.

Let copies of this Resolution be furnished the Office of the Bar Confidant to be entered into respondent's personal record as attorney. Copies shall likewise be furnished the IBP and the Office of the Court Administrator for circulation to all courts concerned.

SO ORDERED.

Endnotes:

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^[1] Rollo, p. 14.

^[2] In Re: Atty. David Briones, A.C. No. 5486, August 15, 2001, 363 SCRA 1, 6.

^[3] CODE OF PROFESSIONAL RESPONSIBILITY, Canon 15.

^[4] Rule 138, Sec. 27.

^[5] Rollo, pp. 55-62.

^[6] Id. at 20.

^[7] Id. at 11.

^[8] Id. at 50.

^[9] Adrimisin v. Javier, A.C. No. 2591, September 8, 2006, 501 SCRA 192, 199.

^[10] Id. at 198.

^[11] Canon 16.

^[12] Dantes v. Dantes, A.C. No. 6486, September 22, 2004, 438 SCRA 582, 590.

^[13] Id. at 588.