August 2012 - Philippine Supreme Court Decisions/Resolutions

Philippine Supreme Court Jurisprudence


Philippine Supreme Court Jurisprudence > Year 2012 > August 2012 Decisions > A.C. No. 9094 - Santos Ventura Hocorma Foundation, Inc., represented by Gabriel H. Abad v. Atty. Richard V. Funk:




A.C. No. 9094 - Santos Ventura Hocorma Foundation, Inc., represented by Gabriel H. Abad v. Atty. Richard V. Funk

PHILIPPINE SUPREME COURT DECISIONS

THIRD DIVISION

[A.C. NO. 9094 - August 15, 2012]

SANTOS VENTURA HOCORMA FOUNDATION, INC., represented by GABRIEL H. ABAD, Complainant, v. ATTY. RICHARD V. FUNK, Respondent.

D E C I S I O N

ABAD, J.:

This is a disbarment case against a lawyer who sued a former client in representation of a new one.

The Facts and the Case

Complainant Santos Ventura Hocorma Foundation, Inc. (Hocorma Foundation) filed a complaint for disbarment against respondent Atty. Richard Funk. It alleged that Atty. Funk used to work as corporate secretary, counsel, chief executive officer, and trustee of the foundation from 1983 to 1985.1 He also served as its counsel in several criminal and civil cases.

Hocorma Foundation further alleged that on November 25, 2006 Atty. Funk filed an action for quieting of title and damages against Hocorma Foundation on behalf of Mabalacat Institute, Inc. (Mabalacat Institute). Atty. Funk did so, according to the foundation, using information that he acquired while serving as its counsel in violation of the Code of Professional Responsibility (CPR) and in breach of attorney-client relationship.2ςrνll

In his answer, Atty. Funk averred that Don Teodoro V. Santos (Santos) organized Mabalacat Institute in 1950 and Hocorma Foundation in 1979. Santos hired him in January 1982 to assist Santos and the organizations he established, including the Mabalacat Institute, in its legal problems. In 1983 the Mabalacat Institute made Atty. Funk serve as a director and legal counsel.3ςrνll

Subsequently, according to Atty. Funk, when Santos got involved in various litigations, he sold or donated substantial portions of his real and personal properties to the Hocorma Foundation. Santos hired Atty. Funk for this purpose. The latter emphasized that, in all these, the attorney-client relationship was always between Santos and him. He was more of Santos' personal lawyer than the lawyer of Hocorma Foundation.4ςrνll

Atty. Funk claimed that before Santos left for America in August 1983 for medical treatment, he entered into a retainer agreement with him. They agreed that Atty. Funk would be paid for his legal services out of the properties that he donated or sold to the Hocorma Foundation. The foundation approved that compensation agreement on December 13, 1983. But it reneged and would not pay Atty. Funk's legal fees.5ςrνll

Atty. Funk also claimed that Santos executed a Special Power of Attorney (SPA) in his favor on August 13, 1983. The SPA authorized him to advise Hocorma Foundation and follow up with it Santos' sale or donation of a 5-hectare land in Pampanga to Mabalacat Institute, covered by TCT 19989-R. Out of these, two hectares already comprised its school site. The remaining three hectares were for campus expansion.

Atty. Funk was to collect all expenses for the property transfer from Hocorma Foundation out of funds that Santos provided. It was Santos' intention since 1950 to give the land to Mabalacat Institute free of rent and expenses. The SPA also authorized Atty. Funk to register the 5-hectare land in the name of Mabalacat Institute so a new title could be issued to it, separate from the properties of Hocorma Foundation.6 When Santos issued the SPA, Atty. Funk was Mabalacat Institute's director and counsel. He was not yet Hocorma Foundation's counsel.7 When Santos executed the deeds of conveyances, Atty. Funk's clients were only Santos and Mabalacat Institute.8ςrνll

According to Atty. Funk, on August 15, 1983 Santos suggested to Hocorma Foundation's Board of Trustees the inclusion of Atty. Funk in that board, a suggestion that the foundation followed.9 After Santos died on September 14, 1983, Atty. Funk was elected President of Mabalacat Institute, a position he had since held.10ςrνll

Atty. Funk claims that in 1985 when Hocorma Foundation refused to pay his attorney's fees, he severed his professional relationship with it. On November 9, 1989, four years later, he filed a complaint against the foundation for collection of his attorney's fees. The trial court, the Court of Appeals (CA), and the Supreme Court decided the claim in his favor.11ςrνll

After hearing, the Committee on Bar Discipline (CBD) found Atty. Funk to have violated Canon 15, Rule 15.0312 of the Code of Professional Responsibility (CPR) with the aggravating circumstance of a pattern of misconduct consisting of four court appearances against his former client, the Hocorma Foundation. The CBD recommended Atty. Funk's suspension from the practice of law for one year.13 On April 16, 2010 the IBP Board of Governors adopted and approved the CBD's report and recommendation.14 Atty. Funk moved for reconsideration but the IBP Board of Governors denied it on June 26, 2011.

The Issue Presented

The issue here is whether or not Atty. Funk betrayed the trust and confidence of a former client in violation of the CPR when he filed several actions against such client on behalf of a new one.

The Court's Ruling

Canon 15, Rule 15.03 of the CPR provides that a lawyer cannot represent conflicting interests except by written consent of all concerned given after a full disclosure of the facts. Here, it is undeniable that Atty. Funk was formerly the legal counsel of Hocorma Foundation. Years after terminating his relationship with the foundation, he filed a complaint against it on behalf of another client, the Mabalacat Institute, without the foundation's written consent.

An attorney owes his client undivided allegiance. Because of the highly fiduciary nature of their relationship, sound public policy dictates that he be prohibited from representing conflicting interests or discharging inconsistent duties. An attorney may not, without being guilty of professional misconduct, act as counsel for a person whose interest conflicts with that of his present or former client. This rule is so absolute that good faith and honest intention on the erring lawyer's part does not make it inoperative.15ςrνll

The reason for this is that a lawyer acquires knowledge of his former client's doings, whether documented or not, that he would ordinarily not have acquired were it not for the trust and confidence that his client placed on him in the light of their relationship. It would simply be impossible for the lawyer to identify and erase such entrusted knowledge with faultless precision or lock the same into an iron box when suing the former client on behalf of a new one.

Here, the evidence shows that Hocorma Foundation availed itself of the legal services of Atty. Funk in connection with, among others, the transfer of one of the properties subject of the several suits that the lawyer subsequently filed against the foundation. Indeed, Atty. Funk collected attorney's fees from the foundation for such services. Thus, he had an obligation not to use any knowledge he acquired during that relationship, including the fact that the property under litigation existed at all, when he sued the foundation.

The Court finds it fitting ti adopt the CBD's recommendation as well as the IBP Board of Governor's resolution respecting the case.

WHEREFORE, the Court AFFIRMS the resolution of the Board of Governors of the Integrated Bar of the Philippines dated April 16, 2010 and June 26, 2011 and SUSPENDS Atty. Richard Funk from the practice of law for one year effective immediately. Serve copies of this decision upon the Office of the Court Administration for dissemination, the Integrated Bar of the Philippines, and the Office of the Bar Confidant so the latter may attach its copy to his record.

SO ORDERED.

Endnotes:

* Designated Acting Member in lieu of Associate Justice Estela M. Perlas-Bernabe per Special Order 1283 dated August 6, 1012.

1 Rollo, Vol. I, p. 2.

2 Id. at 2-5.

3 Id., Vol. II, p. 4.

4 Id. at 5-6.

5 Id. at 6.

6 Id. at 4-5.

7 Id. at 5.

8 Id. at 7.

9 Id.

10 Id. at 4.

11 Id. at 10.

12 Rule 15.03 - A lawyer shall not represent conflicting interests except by written consent of all concerned given after a full disclosure of the facts.

13 Rollo, Vol. III, p. 6.

14 Id. at 1.

15 Artezuela v. Atty. Maderazo, 431 Phil. 135, 143 (2002), citing Maturan v. Gonzales, 350 Phil. 882, 886-887 (1998).

chanrobles virtual law library



Back to Home | Back to Main




















chanrobles.com





ChanRobles On-Line Bar Review

ChanRobles Internet Bar Review : www.chanroblesbar.com

ChanRobles MCLE On-line

ChanRobles Lawnet Inc. - ChanRobles MCLE On-line : www.chanroblesmcleonline.com






August-2012 Jurisprudence                 

  • A.C. No. 9094 - Santos Ventura Hocorma Foundation, Inc., represented by Gabriel H. Abad v. Atty. Richard V. Funk

  • A.C. No. 6116 - Engr. Gilbert Tumbokon v. Atty. Mariano R. Pefianco

  • A.C. No. 9259 - Jasper Junno F. Rodica v. Atty. Manuel M. Lazaro, et al.

  • A.C. No. 9390 - Emilia O. Dhaliwal v. Atty. Abelardo B. Dumaguing

  • A.M. No. P-10-2809 - Manolito C. villordon v. Marilyn C. Avila, Court Interpreter I, Municipal Trial Court in Cities. Branch 3, Cebu City

  • A.M. No. P-12-3029 Formerly OCA I.P.I. No. 08-2850-P - Astorga and Repol Law Offices, represented by Atty. Arnold B. Lugares v. Leodel N. Roxas, Sheriff IV, Regional Trial Court, Branch 66, Makati City

  • A.M. No. P-12-3033 Formerly A.M. No. 10-8-97-MeTC - Memoranda of Judge Eliza B. Yu issued to Legal Researcher Marie Joy P. Lagman and to Court Stenographer Soledad J. Bassig, all of Metropolitan Trial Court, Branch 47, Pasay City

  • A.M. No. P-12-3080 Formerly OCA I.P.I. No. 10-3543-P - Judge Armando S. Adlawan, Presiding Judge, 6th MCTC, Bonifacio-Don Mariano Marcos, Misamis Occidental v. Estrella P. Capilitan, 6th MCTC, Bonifacio-Don Mariano Marcos, Misamis Occidental

  • G.R. No. 137582 - Jose I. Medina v. The Hon. Court of Appeals, et al.

  • G.R. No. 154213 - Eastern Mediterranean Maritime Ltd., et al. v. Estanislao Surio, et al.

  • G.R. No. 155830 - Numeriano P. Abobon v. Felicitas Abata Abobon, et al.

  • G.R. No. 157917 - Spouses Teodorico and Nanette Pere a v. Spouses Nicolas and Teresita L. Zarate, et al.

  • G.R. No. 159508 - Juan B. Ba ez, Jr. v. Hon. Crisanto C. Concepcion, et al.

  • G.R. No. 160444 - Wallem Maritime Services, Inc. v. Ernesto C. Tanawan

  • G.R. No. 163026 - Heirs of Arcadio Castro, Sr. represented by Arcadio Castro, Jr. v. Renato Lozada, et al.

  • G.R. No. 163286, G.R. No. 166025 and G.R. No. 170269 - Mindanao Terminal and Brokerage Service, Inc. v. Court of Appeals and Philippine Ports Authority/Philippine Ports Authority v. Hon. Cesar M. Solis, etc., et al.

  • G.R. No. 163859 - Dr. Fernando A. Melendres M.D., Executive Director of the Lung Center of the Philippines (LCP) v. President Anti-Graft Commission, et al.

  • G.R. No. 165166 - Charles Gotardo v. Divina Buling

  • G.R. No. 166660 - Dorotea Catayas v. Hon. Court of Appeals, Special Former Twentieth Division, Cebu City, et al.

  • G.R. NOS. 166948-59 - People of the Philippines v. Meinrado Enrique A. Bello, et al.

  • G.R. No. 168856 - Eastern Telecommunications Philippines, Inc. v. The Commissioner of Internal Revenue

  • G.R. No. 169254 - De la Salle University v. De la Salle University Employees Association

  • G.R. No. 171076 - Goldloop Properties, Inc. v. Government Service Insurance System

  • G.R. No. 171132 - Manuel D. Yngson, Jr., (in his capacity as the Liquidator of ARCAM & Co., Inc.) v. Philippine National Bank

  • G.R. No. 171182 - University of the Philippines, et al. v. Hon. Agustin S. Dizon, et al.

  • G.R. No. 172008 - Heirs of Rogelio Isip, Sr., et al. v. Rodolfo Quintos, et al.

  • G.R. No. 173268 - Ernesto A. Fajardo v. Office of the Ombudsman, et al.

  • G.R. No. 173474 - People of the Philippines v. Reynaldo Belocura y Perez

  • G.R. No. 174431 - The Heirs of Jolly R. Bugarin namely Ma. Aileen H. Bugarin, Ma. Linda B. Abiog and Ma. Annette B. Sumulong v. Republic of the Philippines

  • G.R. No. 175256 - Lily Lim v. Kou Co Ping a.k.a. Charlie Co/Kou Co Ping a.k.a. Charlie Co v. Lili Lim

  • G.R. No. 175301 - Edito Gulfo and Emmanuela Gulfo v. Jose P. Ancheta

  • G.R. No. 175969 - Jarl Construction and Armando K. Tejada v. Simeon A. Atencio

  • G.R. No. 176984 and G.R. NO. 179131 - Metropolitan Bank and Trust Company v. Servando Arguelles, et al./Marilou Trinidad, et al. v. Servano Arguelles, et al.

  • G.R. No. 177137 - People of the Philippines v. Pedro G. Banig

  • G.R. No. 177907 - Fair Shipping Corp. and/or Kohyu Marine Co, Ltd. v. Joselito T. Medel

  • G.R. No. 178288 - Sps. Charlie Fortaleza and Ofelia Fortaleza v. Sps. Raul Lapitan and Rona Lapitan

  • G.R. No. 179232 and G.R. No. 179290 - The DOW Chemical Company and Occidental Chemical Corporation v. Cecilio Abenon, et al./Del Monte Fresh Produce N.A. and Del Monte Fresh Produce Company v. DOW Chemical Company, et al.

  • G.R. No. 180614 - Leonardo Notarte, et al. v. Godofredo Notarte

  • G.R. No. 181180 - Philasia Shipping Agency Corporation, et al. v. Andres G. Tomacruz

  • G.R. No. 182435 - Lilia B. Luz, et al. v. Florante Baylon

  • G.R. No. 184746 - Spouses Crispin Galang and Caridad Galang v. Spouses Conrado S. Reyes and Fe De Kastro Reyes (As substituted by their legal heir: Hermenigildo K. Reyes)

  • G.R. No. 186169 - Mylene Carvajal v. Luzon Development Bank and/or Oscar Z. Ramirez

  • G.R. No. 186993 - Theodore and Nancy Ang, represented by Eldrige Marvin B. Aceron v. Spouses Alan and Em Ang

  • G.R. No. 187713 - Radio Philippine Network, Inc., et al. v. Ruth F. Yap, et al.

  • G.R. No. 187734 - People of the Philippines v. Antonio Osma, Jr. y Agaton

  • G.R. No. 189529 - Government Service Insurance System (GSIS) and Winston F. Garcia, ih his capacity as President and General Manager of the GSIS v. Maricar B. Buenviaje-Carreon

  • G.R. No. 189998 - Makati Shangri-La Hotel and Resort, Inc. v. Ellen Johanne Harper, et al.

  • G.R. No. 190071 - Union Bank of the Philippines v. Maunlad Homes, Inc., and all other persons or entities claiming rights under it

  • G.R. No. 190144 - Bank of the Philippine islands v. Carlito Lee

  • G.R. No. 190907 - Veterans Philippine Scout Security Agency, Inc. v. First Dominion Prime Holdings, Inc.

  • G.R. No. 191192 - People of the Philippines v. Edgar Balquedra

  • G.R. No. 191532 - Margarita Ambre Y Cayuni v. People of the Philippines

  • G.R. No. 192908 - Republic of the Philippines, represented by the Department of Public Works and Highways (DPWH) v. St. Vincent De Paul Colleges, Inc.

  • G.R. No. 194721 - People of the Philippines v. John Brian Amarillo y Mapa a.k.a. "Jao Mapa"

  • G.R. No. 195097 - Republic of the Philippines v. Marlon Medida

  • G.R. No. 195243 - People of the Philippines v. Raul Beriber y Fuentes

  • G.R. No. 195428 - Jomar S. Verdadero v. Barney Autolines Group of Companies Transport, Inc., et al.

  • G.R. No. 198742 - Teodora Sobejana-Condon v. Commission on Elections, Luis M. Bautista, Robelito V. Picar & Wilma P. Pagaduan

  • G.R. No. 199877 - People of the Philippines v. Arturo Lara y Orbista

  • G.R. No. 200134 - Roberto Otero v. Roger Tan