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RULE 8.02 NOT ENCROACH ON PROFESSIONAL EMPLOYMENT

MANUEL N. CAMACHO, co m plainant , vs . ATTYS. LUIS MEINRADO C.

PANGULAYAN, REGINA D. BALMORES, CATHERINE V. LAUREL andHUBERT JOAQUIN P. BUSTOS of PANGULAYAN AND ASSOCIATESLAW OFFICES, respondents .

D E C I S IO N

VITUG, J .: JVITUG

Respondent lawyers stand indicted for a violation of the Code of ProfessionalEthics, specifically Canon 9 thereof, viz:

"A lawyer should not in any way communicate upon the subject ofcontroversy with a party represented by counsel, much lessshould he undertake to negotiate or compromise the matter withhim, but should only deal with his counsel. It is incumbent uponthe lawyer most particularly to avoid everything that may tend tomislead a party not represented by counsel and he should notundertake to advise him as to law." barth

Atty. Manuel N. Camacho filed a complaint against the lawyers comprising thePangulayan and Associates Law Offices, namely, Attorneys Luis Meinrado C.Pangulayan, Regina D. Balmores, Catherine V. Laurel, and Herbert JoaquinP. Bustos. Complainant, the hired counsel of some expelled students from the

AMA Computer College ("AMACC"), in an action for the Issuance of a Writ ofPreliminary Mandatory Injunction and for Damages, docketed Civil Case No.Q-97-30549 of the Regional Trial Court, Branch 78, of Quezon City, chargedthat respondents, then counsel for the defendants, procured and effected onseparate occasions, without his knowledge, compromise agreements ("Re-

Admission Agreements") with four of his clients in the aforementioned civilcase which, in effect, required them to waive all kinds of claims they might

have had against AMACC, the principal defendant, and to terminate all civil,criminal and administrative proceedings filed against it. Complainant averredthat such an act of respondents was unbecoming of any member of the legalprofession warranting either disbarment or suspension from the practice oflaw.

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In his comment, Attorney Pangulayan acknowledged that not one of his co-respondents had taken part in the negotiation, discussion, formulation, orexecution of the various Re-Admission Agreements complained of and were,in fact, no longer connected at the time with the Pangulayan and AssociatesLaw Offices. The Re-Admission Agreements, he claimed, had nothing to dowith the dismissal of Civil Case Q-97-30549 and were executed for the solepurpose of effecting the settlement of an administrative case involving ninestudents of AMACC who were expelled therefrom upon the recommendationof the Student Disciplinary Tribunal. The students, namely, Ian DexterMarquez, Almira O. Basalo, Neil Jason R. Salcedo, Melissa F. Domondon,Melyda B. De Leon, Leila D. Joven, Signorelli A. Santiago, Michael Ejercito,and Cleo B. Villareiz,, were all members of the Editorial Board of DATALINE,who apparently had caused to be published some objectionable features orarticles in the paper. The 3-member Student Disciplinary Tribunal wasimmediately convened, and after a series of hearings, it found the studentsguilty of the use of indecent language and unauthorized use of the studentpublication funds. The body recommended the penalty of expulsion againstthe erring students. Jksm

The denial of the appeal made by the students to Dr. Amable R. Aguiluz V, AMACC President, gave rise to the commencement of Civil Case No. Q-97-30549 on 14 th March 1997 before the Regional Trial Court, Branch 78, ofQuezon City. While the civil case was still pending, letters of apology and Re-

Admission Agreements were separately executed by and/or in behalf of someof the expelled students, to wit: Letter of Apology, dated 27 May 1997, of NeilJason Salcedo, assisted by his mother, and Re-Admission Agreement of 22June 1997 with the AMACC President; letter of apology, dated 31 March1997, of Mrs. Veronica B. De Leon for her daughter Melyda B. De Leon andRe-Admission Agreement of 09 May 1997 with the AMACC President; letter ofapology, dated 22 May 1997, of Leila Joven, assisted by her mother, and Re-

Admission Agreement of 22 May 1997 with the AMACC President; letter ofapology, dated 22 September 1997, of Cleo Villareiz and Re-Admission

Agreement of 10 October 1997 with the AMACC President; and letter ofapology, dated 20 January 1997, of Michael Ejercito, assisted by his parents,

and Re-Admission Agreement of 23 January 1997 with the AMACC President. Following the execution of the letters of apology and Re-Admission

Agreements, a Manifestation, dated 06 June 1997, was filed with the trialcourt where the civil case was pending by Attorney Regina D. Balmores of thePangulayan and Associates Law Offices for defendant AMACC. A copy of themanifestation was furnished complainant. In his Resolution, dated 14 June

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1997, Judge Lopez of the Quezon City Regional Trial Court thereupondismissed Civil Case No. Q-97-30549.

On 19 June 1999, the Board of Governors of the Integrated Bar of thePhilippines ("IBP") passed Resolution No. XIII-99-163, thus:

"RESOLVED to ADOPT and APPROVE, as it is hereby ADOPTED and APPROVED, the Report and Recommendation ofthe Investigating Commissioner in the above-entitled case, hereinmade part of this Resolution/Decision as Annex 'A,' and, findingthe recommendation fully supported by the evidence on recordand the applicable laws and rules, with an amendment Atty.Meinrado Pangulayan is suspended from the practice of law forSIX (6) MONTHS for being remiss in his duty and DISMISSAL ofthe case against the other Respondents for they did not take partin the negotiation of the case." Chief

It would appear that when the individual letters of apology and Re-Admission Agreements were formalized, complainant was by then already the retainedcounsel for plaintiff students in the civil case. Respondent Pangulayan had fullknowledge of this fact. Although aware that the students were represented bycounsel, respondent attorney proceeded, nonetheless, to negotiate with themand their parents without at the very least communicating the matter to theirlawyer, herein complainant, who was counsel of record in Civil Case No. Q-97-30549. This failure of respondent, whether by design or because ofoversight, is an inexcusable violation of the canons of professional ethics andin utter disregard of a duty owing to a colleague. Respondent fell short of thedemands required of him as a lawyer and as a member of the Bar.

The allegation that the context of the Re-Admission Agreements centers onlyon the administrative aspect of the controversy is belied by theManifestation [1] which, among other things, explicitly contained the followingstipulation; viz:

"1.......Among the nine (9) signatories to the complaint, four (4) ofwhom assisted by their parents/guardian already executed a Re-

Admission Agreement with AMACC President, AMABLE R. AGUILUZ V acknowledging guilt for violating the AMACOMPUTER COLLEGE MANUAL FOR DISCIPLINARY

ACTIONS and agreed among others to terminate all civil, criminaland administrative proceedings which they may have against the

AMACC arising from their previous dismissal. Esm

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"x x x......x x x......x x x

"3. Consequently, as soon as possible, an Urgent Motion toWithdraw from Civil Case No. Q-97-30549 will by filed them."

The Court can only thus concur with the IBP Investigating Commission andthe IBP Board of Governors in their findings; nevertheless, the recommendedsix-month suspension would appear to be somewhat too harsh a penaltygiven the circumstances and the explanation of respondent.

WHEREFORE , respondent Atty. Luis Meinrado C. Pangulayan is orderedSUSPENDED from the practice of law for a period of THREE (3) MONTHSeffective immediately upon his receipt of this decision. The case against theother respondents is DISMISSED for insufficiency of evidence.

Let a copy of this decision be entered in the personal record of respondent asan attorney and as a member of the Bar, and furnished the Bar Confidant, theIntegrated Bar of the Philippines and the Court Administrator for circulation toall courts in the country.

SO ORDERED.

CAMACHO V. PANGULAYAN DIGEST

FACTS9 students from the AMA Computer College (AMACC), all members of the

Editorial Board of DATALINE, allegedly published certain objectionable features. TheStudent Disciplinary Tribunal found them guilty and the students were expelled. The 9students appealed but were denied by the AMACC President, giving rise to a civil casecalling for the Issuance of a Writ of Preliminary Mandatory Injunction with Camacho astheir counsel and Pangulayan and associates representing the defendant, AMACC.While the case was pending, letters of apology and re-admission agreements wereseparately executed in behalf of the students by their parents. Following this, thePangulayan Law Offices filed a Manifestation stating, among other things, that 4 of thestudents had acknowledged their guilt and agreed to terminate all proceedings.

Apparently, Pangulayan procured and effected the re-admission agreements throughnegotiations with said students and their parents without communicating with Camacho

ISSUE

WON Pangulayan is guilty of disregarding professional ethics

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HELD

YES, this action violates Canon 9 of the Code of Professional Ethics which states:

A lawyer should not in anyway communicate upon the subject of controversy with a party represented by counsel, much less should he undertake to negotiate orcompromise the matter with him, but should only deal with his counsel. It is incumbentupon the lawyer most particularly to avoid everything that may tend to mislead a partynot represented by counsel and he should not undertake to advise him as to law.

Respondent violated professional ethics and disregarded a duty owing to his colleague .The Board of Governors of the IBP passed a resolution suspending Pangulayan for 6months and dismissed the case against the other respondents since they took no part init. The court concurred with IBPs findings, but reduced the suspension to 3 months.

CANON 9 UNAUTHORIZED PRACTICE OF LAW

SPOUSES SUAREZ V. SALAZAR

FACTS

At the hearing on the same date, Atty. Filemon A. Manangan admitted that he isnot a lawyer entitled to practice law in the Philippines. He is also the same Filemon A.Manangan who was found by the Court in Filemon Manangan v. CFI Nueva Vizcaya,Br.28, decided on August 30, 1999, to be in reality Andres Culanag who is not amember of the Philippine Bar.

ISSUE

WON Filemon Manangan / Andres Culanag should be held in indirect contempt of theCourt

RULING

Yes. Despite the facts as found by the Court, he has continued to misrepresent himselfto be an attorney-at-law and has appeared as counsel for petitioners in this case. Atty.Filemon A. Manangan, who is in reality Andres Culanag, is hereby declared in indirectcontempt of this Court. Wherefore, he is hereby sentenced to 3 months imprisonment to

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be served at the Headquarters of the National Bureau of Investigation, Taft Ave.,Manila, until further orders of this Court.

DONNA MARIE S. AGUIRRE, compla inan t , vs . EDWIN L.RANA, responden t .

D E C I S I O NCARPIO, J .:

The Case

Before one is admitted to the Philippine Bar, he must possess the requisitemoral integrity for membership in the legal profession. Possession of moralintegrity is of greater importance than possession of legal learning. Thepractice of law is a privilege bestowed only on the morally fit. A bar candidatewho is morally unfit cannot practice law even if he passes the barexaminations.

The Facts

Respondent Edwin L. Rana (respondent) was among those who passedthe 2000 Bar Examinations.

On 21 May 2001, one day before the scheduled mass oath-taking ofsuccessful bar examinees as members of the Philippine Bar, complainantDonna Marie Aguirre (complainant) filed against respondent a Petition forDenial of Admission to the Bar. Complainant charged respondent withunauthorized practice of law, grave misconduct, violation of law, and gravemisrepresentation.

The Court allowed respondent to take his oath as a member of the Barduring the scheduled oath-taking on 22 May 2001 at the PhilippineInternational Convention Center. However, the Court ruled that respondentcould not sign the Roll of Attorneys pending the resolution of the chargeagainst him. Thus, respondent took the lawyers oath on t he scheduled datebut has not signed the Roll of Attorneys up to now.

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Complainant charges respondent for unauthorized practice of law andgrave misconduct. Complainant alleges that respondent, while not yet alawyer, appeared as counsel for a candidate in the May 2001 elections beforethe Municipal Board of Election Canvassers (MBEC) of Mandaon,Masbate. Complainant further alleges that respondent filed with the MBEC apleading dated 19 May 2001 entitled Formal Objection to the Inclusion in theCanvassing of Votes in Some Precincts for the Office of Vice-Mayor. In thispleading, respondent represented himself as counsel for and in behalf of ViceMayoralty Candidate, George Bunan, and signed the pleading as counsel forGeorge Bunan (Bunan).

On the charge of violation of law, complainant claims that respondent is amunicipal government employee, being a secretary of the SangguniangBayan of Mandaon, Masbate. As such, respondent is not allowed by law toact as counsel for a client in any court or administrative body.

On the charge of grave misconduct and misrepresentation, complainantaccuses respondent of acting as counsel for vice mayoralty candidate GeorgeBunan (Bunan) without the latter engaging respondentsservices. Complainant claims that respondent filed the pleading as a ploy toprevent the proclamation of the winning vice mayoralty candidate.

On 22 May 2001, the Court issued a resolution allowing respondent totake the lawyers oath but disallowed him from signing the Roll of Atto rneysuntil he is cleared of the charges against him. In the same resolution, theCourt required respondent to comment on the complaint against him.

In his Comment, respondent admits that Bunan sought his specificassistance to represent him before the MBEC. Respondent claims that hedecided to assist and advice Bunan, not as a lawyer but as a person whoknows the law. Respondent admits signing the 19 May 2001 pleading thatobjected to the inclusion of certain votes in the canvassing. He explains,however, that he did not sign the pleading as a lawyer or represented himselfas an attorney in the pleading.

On his employment as secretary of the Sangguniang Bayan, respondentclaims that he submitted his resignation on 11 May 2001 which was allegedlyaccepted on the same date. He submitted a copy of the Certification ofReceipt of Revocable Resignation dated 28 May 2001 signed by Vice-MayorNapoleon Relox. Respondent further claims that the complaint is politicallymotivated considering that complainant is the daughter of Silvestre Aguirre,the losing candidate for mayor of Mandaon, Masbate. Respondent prays thatthe complaint be dismissed for lack of merit and that he be allowed to sign theRoll of Attorneys.

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On 22 June 2001, complainant filed her Reply to respondents Commentand refuted the claim of respondent that his appearance before the MBECwas only to extend specific assistance to Bunan. Complainant alleges that on19 May 2001 Emily Estipona- Hao (Estipona -Hao) filed a petition forproclamation as the winning candidate for mayor. Respondent signed ascounsel for Estipona-Hao in this petition. When respondent appeared ascounsel before the MBEC, complainant questioned his appearance on twogrounds: (1) respondent had not taken his oath as a lawyer; and (2) he wasan employee of the government.

Respondent filed a Reply (Re: Reply to RespondentsComment) reiterating his claim that the instant administrative case ismotivated mainly by political vendetta.

On 17 July 2001, the Court referred the case to the Office of the BarConfidant (OBC) for evaluation, report and recommendation.

OBCs Report and Recommendation

The OBC found that respondent indeed appeared before the MBEC ascounsel for Bunan in the May 2001 elections. The minutes of the MBECproceedings show that respondent actively participated in theproceedings. The OBC likewise found that respondent appeared in the MBECproceedings even before h e took the lawyers oath on 22 May 2001. The OBC

believes that respondents misconduct casts a serious doubt on his moralfitness to be a member of the Bar. The OBC also believes that respondentsunauthorized practice of law is a ground to deny his admission to the practiceof law. The OBC therefore recommends that respondent be denied admissionto the Philippine Bar.

On the other charges, OBC stated that complainant failed to cite a lawwhich respondent allegedly violated when he appeared as counsel for Bunanwhile he was a government employee. Respondent resigned as secretary andhis resignation was accepted. Likewise, respondent was authorized by Bunanto represent him before the MBEC.

The Courts Ruling

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We agree with the findings and conclusions of the OBC that respondentengaged in the unauthorized practice of law and thus does not deserveadmission to the Philippine Bar.

Respondent took his oath as lawyer on 22 May 2001. However, the

records show that respondent appeared as counsel for Bunan prior to 22 May2001, before respondent took the lawyers oath. In the pleadingentitled Formal Objection to the Inclusion in the Canvassing of Votes in SomePrecincts for the Office of Vice-Mayor dated 19 May 2001, respondent signedas coun sel for George Bun an. In the first paragraph of the same pleadingrespondent stated that he was the (U)ndersigned Counsel for, and inbehalf of Vice Mayoral ty Candid ate, GEORGE T. BUNAN . Bunan himselfwrote the MBEC on 14 May 2001 that he had authorized Atty. Edwin L. Ranaas his counsel to represent him before the MBEC and similar bodies.

On 14 May 2001, mayoralty candidate Emily Estipona- Hao also retainedrespondent as her counsel. On the same date, 14 May 2001, Erly D. Haoinformed the MBEC that Atty. Edwin L. Rana has been authorized byREFORMA LM-PPC as the legal counsel of the party and the candidate of thesaid party. Respondent himself wrote the MBEC on 14 May 2001 that hewas entering his appearance as co uns el for Mayoral ty Candid ate EmilyEstipona-Hao and for the REFORMA LM-PPC . On 19 May 2001,respondent signed as counsel for Estipona-Hao in the petition filed before theMBEC praying for the proclamation of Estipona-Hao as the winning candidatefor mayor of Mandaon, Masbate.

All these happened even b efore respondent took the lawyersoath. Clearly, respondent engaged in the practice of law without being amember of the Philippine Bar.

In Philippine Lawyers Association v. Agrava , [1] the Court elucidated that:

The practice of law is not limited to the conduct of cases or litigation in court; itembraces the preparation of pleadings and other papers incident to actions and special

proceedings, the management of such actions and proceedings on behalf of clients before judges and courts, and in addition, conveyancing. In general, all advice toclients , and all action taken for them in matters connected with the law, incorporationservices, assessment and condemnation services contemplating an appearance before a

judicial body, the foreclosure of a mortgage, enforcement of a creditor's claim in bankruptcy and insolvency proceedings, and conducting proceedings in attachment,and in matters of estate and guardianship have been held to constitute law practice, asdo the preparation and drafting of legal instruments, where the work done involves the

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determination by the trained legal mind of the legal effect of facts and conditions . (5Am. Jur. p. 262, 263). (Italics supplied) x x x

In Cayetano v. Monso d , [2] the Court held that practice of law means anyactivity, in or out of court, which requires the application of law, legalprocedure, knowledge, training and experience. To engage in the practice oflaw is to perform acts which are usually performed by members of the legalprofession. Generally, to practice law is to render any kind of service whichrequires the use of legal knowledge or skill.

Verily, respondent was engaged in the practice of law when he appearedin the proceedings before the MBEC and filed various pleadings, withoutlicense to do so. Evidence clearly supports the charge of unauthorizedpractice of law. Respondent called himself counsel knowing fully well that hewas not a member of the Bar. Having held himself out as counsel knowing

that he had no authority to practice law, respondent has shown moralunfitness to be a member of the Philippine Bar . [3]

The right to practice law is not a natural or constitutional right but is aprivilege. It is limited to persons of good moral character with specialqualifications duly ascertained and certified. The exercise of this privilegepresupposes possession of integrity, legal knowledge, educational attainment,and even public trus t[4] since a lawyer is an officer of the court. A barcandidate does not acquire the right to practice law simply by passing the barexaminations. The practice of law is a privilege that can be withheld even fromone who has passed the bar examinations, if the person seeking admissionhad practiced law without a license . [5]

The regulation of the practice of law is unquestionably strict. In Beltran,Jr. v. Abad , [6] a candidate passed the bar examinations but had not taken hisoath and signed the Roll of Attorneys. He was held in contempt of court forpracticing law even before his admission to the Bar. Under Section 3 (e) ofRule 71 of the Rules of Court, a person who engages in the unauthorizedpractice of law is liable for indirect contempt of court . [7]

True, respondent here passed the 2000 Bar Examinations and took the

lawyers oath. However, it is the signing in the Roll of Attorneys that finallymakes one a full-fledged lawyer. The fact that respondent passed the barexaminations is immaterial. Passing the bar is not the only qualification tobecome an attorney-at-law . [8] Respondent should know that two essentialrequisites for becoming a lawyer still had to be performed, namely: hislawyers oath to be administered by this Court and his signature in the Roll of

Attorneys . [9]

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On the charge of violation of law, complainant contends that the law doesnot allow respondent to act as counsel for a private client in any court oradministrative body since respondent is the secretary of the SangguniangBayan.

Respondent tendered his resignation as secretary of the SangguniangBayan prior to the acts complained of as constituting unauthorized practice oflaw. In his letter dated 11 May 2001 addressed to Napoleon Relox, vice-mayor and presiding officer of the Sangguniang Bayan, respondent stated thathe was resigning effective upon your acceptance. [10] Vice-Mayor Reloxaccepted respondents resignation effective 11 May 2001 . [11] Thus, theevidence does not support the charge that respondent acted as counsel for aclient while serving as secretary of the Sangguniang Bayan.

On the charge of grave misconduct and misrepresentation, evidenceshows that Bunan indeed authorized respondent to represent him as hiscounsel before the MBEC and similar bodies. While there was nomisrepresentation, respondent nonetheless had no authority to practice law.

WHEREFORE , respondent Edwin L. Rana is DENIED admission to thePhilippine Bar.

SO ORDERED.

AGUIRRE V RANA DIGEST

FACTSOn May 21, 2001, one day before respondent Edwin Rana participated the oath-taking

of successful bar examinees as member of the Philippine bar, complainant Donna Marie Aguirre filed against respondent a Petition for Denial of Admission to the Bar on theground of unauthorized practice of law, grave misconduct, violation of law, and gravemisrepresentation. The Court allowed respondent to take the oath, but did not allow himto sign the Roll of Attorneys. The complainant charges him with unauthorized practice oflaw and grave misconduct since she claims that he already appeared as counsel forand in behalf of Vice Mayoralty Candidate of Mandaon, Masbate, George Bunan beforethe Municipal Board of Canvassers. She also claims that he signed the pleading dated19 May 2001 entitled Formal Objection to the Inclusion in the Canvassing of Votes inSome Precincts for the Office of Vice-Mayor as counsel for the said candidate. On thecharge of violation of law, complainant claims that the respondent is a municipalgovernment employee and as such, he is not allowed by law to act as counsel for aclient in any court or administrative body. On the charge of grave misconduct andmisrepresentation, complainant accuses respondent of acting as counsel GeorgeBunan without the latter engaging respondents services. Complainant claims that

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respondent filed the pleading as a ploy to prevent the proclamation of the winning vicemayoralty candidate. Respondent claims though George Bunan sought his specificassistance, he decided to assist and advice Bunan, not as a lawyer but as a p ersonwho knows the law. He also admitted signing the pleading, but not as a lawyer. In replyto the charge of violation of law, he claims that he already resigned from the said

government post May 11, 2001. He further claims that the complaint is politicallycharged since the complainant is the daughter of the losing candidate for mayor ofMandaon, Masbate. In the complainants reply to the respondents comments, shefurther alleges that on May 19, Emily Estipona-Hao filed a petition for proclamation asthe winning candidate for mayor wherein the respondent signed as counsel for her. OnJuly 17, the Court referred the case to the Office of the Bar Confident (OBC). The OBCfound that the respondent indeed appeared before the MBEC as counsel for Bunan, asseen in the minutes of the MBEC proceedings. The OBC also believes thatrespondents unauthorized practice of law is a ground to deny his admission to thepractice of law.

ISSUE

WON the respondent should be denied admission to the Philippine Bar

RULING

Yes. Records show that he indeed appeared as lawyer for Bunan. He also signed thepleading as his lawyer. In the first paragraph of the same pleading respondent statedthat he was the Undersigned Counsel for, and in behalf of Vice Mayoralty Candidate,GEORGE T. BUNAN . Bunan himself also wrote to the MBEC that he had authorized

Atty. Edwin L. Rana as his counsel to represent him before the MBEC and similarbodies. Emily Estipona-Hao also wrote to the MBEC that the respondent will be thelegal counsel for her party. The respondent also signed the pleading as their lawyer. Allthese happened before he took his lawyers oath. It is clear that he engaged in thepractice of law. It is also irrelevant the respondent has already passed the bar and takenhis oath, for it is the signing in the Roll of Attorneys which makes one a full-fledgedlawyer. As for the charge of violation of law, it is clear that the respondent has alreadyresigned from the said position before appearing as counsel. On the charge of gravemisconduct and misrepresentation, evidence shows that Bunan indeed authorizedrespondent to represent him as his counsel before the MBEC and similar bodies. While

there was no misrepresentation, respondent nonetheless had no authority to practicelaw. Respondent is denied admission to the Philippine Bar

OFFICE OF THE COURT ADMINISTRATOR, complainant, vs. ATTY.MISAEL M. LADAGA, Branch Clerk of Court, Regional Trial Court,Branch 133, Makati City, respondent .

R E S O L U T I O N

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KAPUNAN, J .:

In a Letter, dated August 31, 1998, respondent Atty. Misael M. Ladaga, Branch Clerk ofCourt of the Regional Trial Court of Makati, Branch 133, requested the Court Administrator,Justice Alfredo L. Benipayo, for authority to appear as pro bono counsel of his cousin, Narcisa

Naldoza Ladaga, in Criminal Case No. 84885, entitled People vs. Narcisa Naldoza Ladaga forFalsification of Public Document pending before the Metropolitan Trial Court of Quezon City,Branch 40 .[1] While respondents letter -request was pending action, Lisa Payoyo Andres, the

private complainant in Criminal Case No. 84885, sent a letter to the Court Administrator, datedSeptember 2, 19 98, requesting for a certification with regard to respondents authority to appearas counsel for the accused in the said criminal case .[2] On September 7, 1998, the Office of theCourt Administrator referred the matter to respondent for comment .[3]

In his Comment ,[4] dated September 14, 1998, respondent admitted that he had appeared inCriminal Case No. 84885 without prior authorization. He reasoned out that the factualcircumstances surrounding the criminal case compelled him to handle the defense of his cousinwho did not have enough resources to hire the services of a counsel de parte ; while, on the other

hand, private complainant was a member of a powerful family who was out to get even with hiscousin. Furthermore, he rationalized that his appearance in the criminal case did not prejudicehis office nor the interest of the public since he did not take advantage of his position. In anycase, his appearances in court were covered by leave application approved by the presiding

judge.

On December 8, 1998, the Court issued a resolution denying respondents request forauthorization to appear as counsel and directing the Office of the Court Administrator to fileformal charges against him for appearing in court without the required authorization from theCourt .[5] On January 25, 1999, the Court Administrator filed the instant administrative complaintagainst respondent for violating Sec. 7(b)(2) of Republic Act No. 6713, otherwise known as theCode of Conduct and Ethical Standards for Public Officials and Employees, which provides:

Sec. 7. Prohibited Acts and Transactions. In addition to acts and omissions of publicofficials and employees now prescribed in the Constitution and existing laws, thefollowing shall constitute prohibited acts and transactions of any public official andemployee and are hereby declared to be unlawful:

x x x

(b) Outside employment and other activities related thereto.- Public officials and employeesduring their incumbency shall not:

x x x

(2) Engage in the private practice of their profession unless authorized by theConstitution or law, Provided, that such practice will not conflict or tend toconflict with their official functions;

In our Resolution, dated February 9, 1999, we required respondent to comment on theadministrative complaint.

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In his Comment, respondent explained that he and Ms. Ladaga are close blood cousinswho belong to a powerless family from the impoverished town of Bacauag, Surigao del

Norte. From childhood until he finished his law degree, Ms. Ladaga had always supported andguided him while he looked up to her as a mentor and an adviser. Because of their closerelationship, Ms. Ladaga sought respondents help and advice when she was charged in Criminal

Case No. 84885 for falsification by the private complainant, Lisa Payoyo Andres, whose only purpose in filing the said criminal case was to seek vengeance on her cousin. He explainedthat his cousins discord with Ms. Andres started when the latters husband, SPO4 Pedro Andres,left the conjugal home to cohabit with Ms. Ladaga. During the course of their illicit affair, SPO4Andres and Ms. Ladaga begot three (3) children. The birth certificate of their eldest child is thesubject of the falsification charge against Ms. Ladaga. Respondent stated that since he is theonly lawyer in their family, he felt it to be his duty to accept Ms. Ladagas plea to be her counselsince she did not have enough funds to pay for the services of a lawyer. Respondent also pointedout that in his seven (7) years of untainted government service, initially with the Commission onHuman Rights and now with the judiciary, he had performed his duties with honesty andintegrity and that it was only in this particular case that he had been administratively charged for

extending a helping hand to a close relative by giving a free legal assistance for humanitarian purpose. He never took advantage of his position as branch clerk of court since the questionedappearances were made in the Metropolitan Trial Court of Quezon City and not in Makati wherehe is holding office. He stressed that during the hearings of the criminal case, he was on leave asshown by his approved leave applications attached to his comment.

In our Resolution, dated June 22 , 1999, we noted respondents comment and referred theadministrative matter to the Executive Judge of the Regional Trial Court of Makati, JudgeJosefina Guevarra-Salonga, for investigation, report and recommendation.

In her Report, dated September 29, 1999, Judge Salonga made the following findings andrecommendation:

There is no question that Atty. Misael Ladaga appeared as counsel for and in behalf ofhis cousin, Narcisa Naldoza Ladaga, an accused in Criminal Case No. 84-885 forFalsification of Public Documents before the METC of Quezon City. It is alsodenied that the appearance of said respondent in said case was without the previous

permission of the Court.

An examination of the records shows that during the occasions that the respondentappeared as such counsel before the METC of Quezon City, he was on official leaveof absence. Moreover, his Presiding Judge, Judge Napoleon Inoturan was aware of

the case he was handling. That the respondent appeared as pro bono counsel likewisecannot be denied. His cousin-client Narcisa Ladaga herself positively declared thatthe respondent did not receive a single centavo from her. Helpless as she was andrespondent being the only lawyer in the family, he agreed to represent her out of hiscompassion and high regard for her.

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It may not be amiss to point out, this is the first time that respondent ever handled acase for a member of his family who is like a big sister to him. He appeared for freeand for the purpose of settling the case amicably. Furthermore, his Presiding Judgewas aware of his appearance as counsel for his cousin. On top of this, during all theyears that he has been in government service, he has maintained his integrity andindependence.

RECOMMENDATION

In the light of the foregoing, it appearing that the respondent appeared as counsel forhis cousin without first securing permission from the court, and considering that this ishis first time to do it coupled with the fact that said appearance was not for a fee andwas with the knowledge of his Presiding Judge, it is hereby respectfully recommendedthat he be REPRIMANDED with a stern warning that any repetition of such act would

be dealt with more severely .[6]

We agree with the recommendation of the investigating judge.

Respondent is charged under Sec. 7(b)(2) of the Code of Conduct and Ethical Standards forPublic Officials and Employees which prohibits civil servants from engaging in the private

practice of their profession. A similar prohibition is found under Sec. 35, Rule 138 of theRevised Rules of Court which disallows certain attorneys from engaging in the private practiceof their profession. The said section reads:

SEC. 35. Certain attorneys not to practice.- No judge or other official or employee ofthe superior courts or of the Office of the Solicitor General, shall engage in private

practice as a member of the bar or give professional advise to clients.

However, it should be cl arified that private practice of a profession, specifically the law profession in this case, which is prohibited, does not pertain to an isolated court appearance;rather, it contemplates a succession of acts of the same nature habitually or customarily holdingones self to the public as a lawyer.

In the case of People vs. Villanueva , [7] we explained the meaning of the term private practice prohibite d by the said section, to wit:

We believe that the isolated appearance of City Attorney Fule did not constitute

private practice, within the meaning and contemplation of the Rules. Practice is morethan an isolated appearance, for it consists in frequent or customary action, asuccession of acts of the same kind. In other words, it is frequent habitual exercise(State vs. Cotner, 127, p. 1, 87 Kan. 864, 42 LRA, N.S. 768) Practice of law to fallwithin the prohibition of statute has been interpreted as customarily or habituallyholding ones self out to the public, as a lawyer and demanding payment for suchservices (State vs. Bryan, 4 S.E. 522, 98 N.C. 644, 647). The appearance as counsel

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on one occasion, is not conclusive as determinative of engagement in the private practice of law. The following observation of the Solicitor General is noteworthy:

Essentially, the word private practice of law implies that one must have presented himself to be in the active and continued practice of the legal professionand that his professional services are available to the public for a compensation,as a source of his livelihood or in consideration of his said services.

For one thing, it has never been refuted that City Attorney Fule had been given permission by his immediate superior, the Secretary of Justice, to represent thecomplainant in the case at bar, who is a relative .[8]

Based on the foregoing, it is evident that the isolated instances when respondent appearedas pro bono counsel of his cousin in Criminal Case No. 84885 does not constitute the private

practice of the law profession contemplated by law.

Nonetheless, while respondents isolated court appeara nces did not amount to a private practice of law, he failed to obtain a written permission therefor from the head of theDepartment, which is this Court as required by Section 12, Rule XVIII of the Revised CivilService Rules, thus:

Sec. 12. No officer or employee shall engage directly in any private business,vocation, or profession or be connected with any commercial, credit, agricultural, orindustrial undertaking without a written permission from the head of theDepartment : Provided , That this prohibition will be absolute in the case of thoseofficers and employees whose duties and responsibilities require that their entire time

be at the disposal of the Government; Provided , further , That if an employee isgranted permission to engage in outside activities, time so devoted outside of officehours should be fixed by the agency to the end that it will not impair in any way theefficiency of the officer or employee: And provided, finally , That no permission isnecessary in the case of investments, made by an officer or employee, which do notinvolve real or apparent conflict between his private interests and public duties, or inany way influence him in the discharge of his duties, and he shall not take part in themanagement of the enterprise or become an officer of the board of directors .[9]

Respondent entered his appearance and attended court proceedings on numerous

occasions, i.e., May 4-15, 1998, June 18, 1998, July 13, 1998 and August 5, 1998, as borne out by his own admission. It is true that he filed leave applications corresponding to the dates heappeared in court. However, he failed to obtain a prior permission from the head of theDepartment. The presiding judge of the court to which respondent is assigned is not the head ofthe Department contemplated by law.

WHEREFORE , in view of the foregoing, respondent Atty. Misael M. Ladaga is herebyREPRIMANDED with a stern warning that any repetition of such act would be dealt with moreseverely.

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SO ORDERED.

OFFICE OF THE COURT ADMINISTRATOR V. LADAGA DIGEST

FACTS

Respondent Atty. Misael M. Ladaga, Branch Clerk of Court of the RTC of Makati,represented his cousin Narcisa Naldoza Ladaga as pro bono counsel in a criminal casefor falsification of public document. The Court denied respondents request forauthorization to appear as counsel and directed the Office of the Court Administrator tofile formal charges against him for appearing in court without the required authorization.In his Comment, respondent explained that he and Ms. Ladaga are close bloodcousins who belong to a powerless family from an impoverished town in Surigao delNorte. Ms. Ladaga had supported and guided respondent from childhood until hefinished his law degree. Because of their close relationship, Ms. Ladaga sought

respondents help and advice when she was charged in a criminal case by Lisa Payoyo Andres. Respondent claims that Ms. Andres only purpose in filin g the case was toseek vengeance on Ms. Ladaga. He explains that the discord between his cousin andMs. Andres started when the latters husband, SPO4 Pedro Andres, left the conjugalhome to cohabit with Ms. Ladaga. During the course of their illicit affair, SPO4 Andresand Ms. Ladaga begot 3 children. The birth certificate of their eldest child is the subjectof the falsification charge against Ms. Ladaga. Respondent stated that he felt it was hisduty to accept Ms. Ladagas plea to be her counsel as she could not pay for theservices of a lawyer and he was the only lawyer in the family. Respondent also pointedout that in 7 years of government service he had performed his duties with honesty andintegrity and it was only in this particular case that he had been administratively chargedfor helping a close relative by giving free legal assistance for a humanitarian purpose.He never took advantage of his position as branch clerk of court since the questionedappearances were made in the MTC of Quezon City and not in Makati where he isholding office. Respondent also stressed that during his court appearances, he was onleave as shown by his approved leave applications.

ISSUES

1. WON respondent violated the Code of Conduct and Ethical Standards for Public

Officials and Employees by appearing as counsel2. WON respondent obtained written permission from the head of the department asrequired by Sec. 12, Rule XVIII of the Revised Civil Service Rules

HELD

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1. No. Private practice of a profession, specifical ly the law profession, does not refer toan isolated court appearance. It contemplates a succession of acts of the same naturehabitually or customarily holding ones self to the public as a lawyer. The isolatedinstances when respondent appeared as pro bono counsel for his cousin does notconstitute the private practice of the law profession as contemplated by law.

2. No. It is true that respondent filed leave applications corresponding to the dates heappeared in court, which were approved. However, the presiding judge of the court towhich respondent is assigned is not the head of the Department contemplated by law.

Respondent is REPRIMANDED with a stern warning that any repetition of such actwould be dealt with more severely.

RULE 138-A

Law Student Practice Rule

Section 1. Conditions for student practice. A law student who has successfullycompleted his 3rd year of the regular four-year prescribed law curriculum and is enrolledin a recognized law school's clinical legal education program approved by the Supreme

Court, may appear without compensation in any civil, criminal or administrative casebefore any trial court, tribunal, board or officer, to represent indigent clients accepted by

the legal clinic of the law school.

Section 2. Appearance. The appearance of the law student authorized by this rule,shall be under the direct supervision and control of a member of the Integrated Bar of

the Philippines duly accredited by the law school. Any and all pleadings, motions, briefs,memoranda or other papers to be filed, must be signed by the supervising attorney for

and in behalf of the legal clinic.

Section 3. Privileged communications. The Rules safeguarding privilegedcommunications between attorney and client shall apply to similar communications

made to or received by the law student, acting for the legal clinic.

Section 4. Standards of conduct and supervision. The law student shall comply withthe standards of professional conduct governing members of the Bar. Failure of anattorney to provide adequate supervision of student practice may be a ground for

disciplinary action. (Circular No. 19, dated December 19, 1986).

RULE 9.02 NOT TO DIVIDE LEGAL FEES

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FORTUNATO HALILI, doing business under the name and style HALILI TRANSIT (substitutedby Emilia de Vera de Halili), petitionervs.COURT OF INDUSTRIAL RELATIONS and HALILI BUS DRIVERS AND CONDUCTORS UNION(PTGWO), respondents.

G.R. No. L-27773 November 19, 1985

EMILIA DE VERA VDA. DE HALILI, petitioner,vs.COURT OF INDUSTRIAL RELATIONS and HALILI BUS DRIVERS AND CONDUCTORS UNION(PTGWO), respondents.

G.R. No. L-38655 November 19, 1985

FELICIDAD M. TOLENTINO, et al., petitioners,vs.COURT OF INDUSTRIAL RELATIONS, et al., respondents.

G.R. No. L-30110 November 19, 1985

EMILIA DE VERA. VDA. DE HALILI, petitioner,

vs,

HALILI BUS DRIVERS AND CONDUCTORS UNION (PTGWO) and COURT OF INDUSTRIALRELATIONS, respondents.

Ruben C. Asedillo counsel for Manila Bank.

Pedro A. Lopez counsel for Halili Bus Drivers Transport Hall.

R E S O L U T I O N

MAKASIAR, C.J.:

On April 30, 1985, We resolved an urgent motion to cite Atty. Benjamin C. Pineda, Ricardo Capunoand Manila Bank (Cubao Branch) in contempt for their continued failure to comply with this Court'stemporary mandatory restraining order issued on September 1, 1983 and with Its resolution datedSeptember 13, 1983 which required compliance with the aforesaid restraining order. WE disposed ofthe above motion in the following terms:

WHEREFORE, ATTY. BENJAMIN PINEDA IS HEREBY FOUND GUILTY OFINDIRECT CONTEMPT OF COURT FOR WHICH HE IS HEREBY SENTENCED TOIMPRISONMENT IN THE MANILA CITY JAIL UNTIL THE ORDERS OF THISCOURT DATED SEPTEMBER 1 AND SEPTEMBER 13, 1983 ARE COMPLIEDWITH.

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ATTY. BENJAMIN PINEDA IS ALSO DIRECTED TO SHOW CAUSE WHY HESHOULD NOT BE DISBARRED UNDER RULE 138 OF THE REVISED RULES OFCOURT.

LET COPIES OF THIS RESOLUTION AND THE RESOLUTION OF OCTOBER18,1983 BE FURNISHED THE MINISTRY OF LABOR AND THE TANODBAYAN

FOR APPROPRIATE ACTION (p. 424, L- 27773 rec.).

Atty. Benjamin Pineda moved for reconsideration of the aforecited resolution on May 13, 1985,therein stating, among other things, that he could not comply with Our resolution of September 1,1983 since after withdrawals and disbursements, only P 2,022.70 remained from his account withthe Manila Bank (Cubao Branch); that he admits the wrong he has committed, apologizes for thesame and promises that he will do his best to make restitution; that as evidence of his act ofrepentance and restitution, he delivered to the NLRC on May 10, 1985 TCT No. 181023 covering hisregistered real estate property consisting of 633 square meters and the amount of P30,000.00 incash, in partial compliance with this Court's resolution of April 30, 1985; that he helped in facilitatingthe sale in order to pay the accumulated real estate taxes; and that his retainer's contract wasannotated at the back of the title of said property (TCT No. 205785) as attorney's lien, MovantPineda now prays for a reconsideration of Our April 30, 1985 resolution (p. 426, L-27773 rec.).

On May 21, 1985, movant Pineda filed his supplement to motion for reconsideration therein stating,among other things, that in compliance with this Court's resolution of October 18, 1983, remandingthese cases to the NLRC for further proceedings, Labor Arbiter Antonio Tria Tirona conducted ahearing on May 20, 1985 where the union, Atty. Jose C. Espinas, Atty. Pedro Lopez and hereinmovant appeared; and, that the aforenamed parties agreed on these terms:

1. that movant is still answerable for the uncontested amount of P407,424.00representing the 10% excess attorney's fees in the amount of P203,712.00, to berefunded to the Union and the 10% attomey's fees due to Atty. Espinas and Atty.Lopez in the amount of P203,712.00, as per NLRC order dated April 24, 1985. Saidorder awarded 7% attorney's fees to Atty. Espinas; 3% to Atty, Lopez and 10% tomovant Pineda, which apportionment corresponds to the 20% attorney's fees asadjudged in subject resolution.

2. that the real property covered by TCT No. 181023 which movant delivered to theNLRC plus the amount of P30,000.00 remitted to the NLRC shall answer for hisobligation; and he will sell the said property and deposit the proceeds therefrom tothe NLRC, for further proceedings.

In the aforesaid supplement, movant reiterates his averments that he negotiated the sale of theunion property in 1983 under the impression that the NLRC had the authority to allow the questionedtransaction and that it was as honest opinion that when the CIR was abolished and replaced by theNLRC, the jurisdiction, power and functions of the former were transferred to the latter agency

which, he presumed, had the authority to authorize the purchase. Finally, he claims that his actswere all done in good faith and reiterates his contrition and is making restitution for the same (p. 435,L- 27773 rec.).

On May 21, 1985, this Court issued a resolution denying movant's motion for reconsideration of April30, 1985 for lack of merit (p. 431 L-27773 rec.).

Movant counsel filed on June 6, 1985 his second motion for reconsideration of Our original subjectresolution and the aforecited minute resolution dated May 21, 1985 denying his first motion for

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reconsideration and the supplement thereto for lack of merit. In this motion, movant alleges that hisaccountability as of June 5, 1985 (date of motion) has been reduced to P377,424.00 and notanymore P710,969.30 as originally computed; that he restates that his accountability to Attys. JoseC. Espinas and Pedro Lopez and the union is P407,424.00 only which amount was arrived at andagreed upon by the parties in the proceedings held on May 20, 1985 and which represents the 20%attorney's fees due the three lawyers on record (Pineda, Espinas and Lopez). The aforesaid

attorney's fees were awarded in the order of the NLRC issued on April 24, 1985; that per NLRCrecords, Atty, Espinas has already been paid P50,000.00 and Atty. Lopez has already receivedP20,000.00 as partial attomey's fees; that movant's accountability remains at P377,424.00 afterdeducting the amount of P30,000.00 (remitted on May 10, 1985) from the above amount ofP407,424.00; that movant has been doing his best to comply with this Court's order and purgehimself of the contempt citation in these cases; and, not being able to produce immediately theamount of P 407,424:00, he initially remitted the said amount of P30,000.00 and delivered to theNLRC the title to his property as aforesaid; that in the hearing before the NLRC on June 3, 1985,movant manifested on record in the presence of Atty. Espinas and the union officers that he isselling as other properties to satisfy his remaining obligation and that Atty. Espinas and the unionofficers gave him reasonable time within which to sell said other properties; and, that in the June 3hearing at the NLRC, movant submitted a xerox copy of Cashier's Check No. 340573 dated June 23,1983 of the Manila Bank -in the amount of P101,856.00 paid by him to the Halili Bus Drivers &Conductors Union, for the account of the payee only. Movant now prays for the necessary correctionof his accountability from P710,969.30 to the reduced amount of P377,424.00 and for a chance tosell his properties, as agreed upon by the parties, to enable him to pay the remaining amount ofP377,424.00 (p. 444, L-27773, rec.).

On June 19, 1985, Arbiter Raymundo Valenzuela filed his manifestation and/or comment wherein hecontends, among other things, that sometime in the second week of August, 1982, the Office of theExecutive Labor Arbiter Benigno L. Vivar of the NCR, NLRC endorsed to him a pleading entitled"Motion and/or Manifestation" under caption of "Halili Bus Drivers and Conductors Union (PTGWO),complainants, versus Fortunato F. Halili doing business under the name and style Halili Transit,"Respondent, CIR Case No. 1099-V"; and, that said motion was signed under the heading "B.C.Pineda, Counsel for the Complainant, c/o North Harbor Labor Federation-TUCP 1106-1005 Marcos

Road Fronting Pier 6, North Harbor, Tondo, Manila." Also, he claims that the aforecited motion withthree attached documents (Notice of Judgment dated May 3, 1976 in G.R. Nos.L-38655 and L30110; TCT No. 205755 and Order dated February 9, 1983 of herein movant) werethe only records endorsed to him for the resolution of Atty. Pineda's motion and that he was verballyinformed by the former that the records of CIR Case No. 1099-V could not be located anymore at theNLRC offices. He furthere alleges that since there were no other records except the aforesaidmotion of Atty. Pineda with the three annexes and, for the reasons that Atty. Pineda is a brother inthe profession and an officer of the Court and that this case started in 1958 and transferred from thedefunct CIR to the NLRC, he had reasonable ground to believe that the records of the case couldnot be found anymore. Labor Arbiter Valenzuela also claims Chat as labor arbiter, he has the power,under Article 300 of the labor Code, to execute and implement final and executory judgments.Finally, he avers that since the motion of Atty. Pineda filed on December 1, 1982 with this Courtpraying for authority to dispose of subject property was merely "Noted" by said Court, such action

bolstered his belief that his office possesses the jurisdiction to authorize the questioned sale (p. 491,L-27773 rec.).

On June 25, 1985, Atty. Jose C. Espinas submitted his comment on the motions for reconsiderationof Atty. B.C. Pineda and on the manifestation and/or comment of Labor Arbiter Valenzuela, On thelatter's manifestation and/or comment, Atty. Espinas points to the following inaccuracies in theaforesaid pleading of Labor Arbiter Valenzuela:

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1. Labor Arbiter Valenzuela, in citing the inscription at the transfer certificate of title, omitted somewords which would show that there are other counsel in these cases. He quotes the acurate notationthus:

PE-1101/T-205755 Attorney's Lien This property is subject to attorney's lien andother counsel in CIR Case No. 1099-B pursuant to their retainer contracts. (Doc No.

75, Page No. 16, Book I of the Notary Public of Rizal, A.G. Gatmaytan).

2. It is not correct to say that in the "Notice of Judgment" by this Court in Cases L-38655 and L-30110, the counsel named therein for the union was only Atty. Pineda when the fact is that the decisionof this Court in the aforecited cases dated February 27 1976, acknowledges the representation ofother lawyers in these words of its dispositive portion: " subject to attorney's lien in favor of Atty, B.CPineda and other counsel in said case pursuant to their retainer contracts . (Emphasis supplied).

3. It is inaccurate for Labor Arbiter Valenzuela to allege That he did not determine attomey's fees inhis orders when it appears that in his order of February 9, 1983, the following was ordered:

(b) The Attorney's Lien equivalent to Thirty-Five percent (35%) of the total purchase

price of said parcel of land covered by TCT No 205755, as annotated at the back ofsaid Title per Entry PE-1101/T-205755 in favor of Atty. Benjamin C. Pineda. ...

4. While Labor Arbiter Valenzuela manifests that in cases L-38655 andL-30110, Volume 69 of the SCRA which published the decision, carries the name of Atty. B.C.Pineda as counsel for the union, he nevertheless avoids pointing out that in L-24864 which waspreviously published in Volume 22 of the SCRA, Atty. Jose C. Espinas was named as the lonecounsel.

5. Before Labor Arbiter Valenzuela acted on the motions of Atty. B.C. Pineda, he should have firstexerted all efforts to reconstitute the records since he very well knew that the records were notcomplete. He should have informed the Executive labor Arbiter, who assigned to him the case thatthe records thereof were missing. He committed an act of omission.

6. It is incorrect for Labor Arbiter Valenzuela to state that Atty. J.C. Espinas sought for a reduction ofattorney's fees from 35% to 20% when the evidence would have shown, if a hearing on the twomotions was conducted, that the contract for services was contingent (20%) only for all lawyers ofthe firm per resolution of the union's general membership) as found by Arbiter Tirona in his decisionof April 24, 1985.

Atty. Espinas submits the following comment on Atty. Pineda's motion for reconsideration:

1. Atty. Pineda has never complied with this Court's three resolutions dated September 1,September 13 and October 18, 1983. Except for the check he issued on June 23, 1983 in theamount of P2,022.70 in favor of the union, he allegedly spent P710,959.30 within a period of 2months and 7 days (between June 23 and September 1, 1983). The declaration of Atty. Pineda thatthe temporary mandatory restraining orders have become moot and academic by reason ofexhaustion of the funds imply that said orders are unimportant to him.

2. When Atty. Pineda filed his motion requesting for authority to sell the property on August 9, 1982,he attached a zerox copy of the certificate of title thereto. The notation on the said title showed thathe was not the only lawyer in his case, Yet, he represented before Arbiter Valenzuela that he aloneand the latter readily believed him. one was the counsel

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3. Atty. Pineda's apologetic stance and allegation of good faith are negated by the fact that theadditional cash payment P25.000.00 to the union when the property was transferred to themintended for the payment of taxes, was never accounted for; and, the fact that in alienating subjectproperly which was held in trust by the union, the consent of the members workers, not only theirleaders, is legally required.

4. The reduction of Atty. Pineda's accountability to P377,424.00 is premature since the proceedingsfor the determination of his liability is still pending consideration before Arbiter Tirona. Thedetermination of his liability for P101,856.00 given to the union through Domingo Cabading and legalinterests and damages claimed by the anion members against him are also pending resolution.

5. In his order dated April 24, 1985, Labor Arbiter Tirona directed Atty. Pineda to deposit 25% of the35% attorney's fees collected by him (minus P2,022,70) previously deposited with the Commissionfor proper disposition, because Atty. Pineda did not comply with the temporary mandatory restrainingorder of this Court (p. 538, L-27773 rec.).

The Solicitor General filed on July 28, 1985 his comment on the two motions for reconsideration andthe supplement hereto of Atty. B.C. Pineda. The Solicitor General submits that the attorney's fees of

P 203,712.00 is deductible since Atty. Pineda is entitled to said fees as per order of Arbiter Tirona:that the amount of P30,000.00 may also be deducted since it corresponds to partial restitution of hisliability; and, that the alleged donation of P101,856.00 may not be deducted because it amounts to arebate or a commission as already noted by this Court. He also submits that such donation is aviolation of Canon 34 of Legal Ethics. Furthermore. he reports that there was nothing in the hearingof May 20, 1985 which authorizes Atty. Pineda to deduct the above donation and that after deductingall amounts the latter has deposited including the P20,000.00 on June 19, 1985, his accountabilityremains at P457,257.30 The Solicitor General finally submits that contemnor Pineda's repeatedprotestations of good faith have no basis considering that he responded in cavalier fashion to thisCourt's resolutions by simply stating in effect that since he has already spent the money, the ordersshould be deemed moot and academic; that he maintained an arrogant attitude towards theproceedings in the NLRC; and that he utterly failed, as union counsel, to protect the rights of theworkers when he allowed realty taxes on the lot to accumulate for 8 years, when he did not exert

utmost diligence in causing the sale of the lot and when he charged excessive attorney's feesamounting to over half a million pesos and spending the amount in over two months. The SolicitorGeneral thus prays for the denial of the motions for reconsideration for lack of merit (p. 225, L-38655, rec.).

On August 7, 1985, contemnor Atty. B.C. Pineda filed his comment on the comment of Atty. Jose C.Espinas dated June 25, 1985. He substantially alleges that Atty. Espinas continues harping on the"scheme" allegedly employed by the former In this case: what Atty. Espinas file his urgent motion of

August 25, 1983 when they failed to agree on the " balato " or token payment which said lawyer askedof am; that contemnor Atty. Pineda is not running away from his obligations to the parties concerned,which obligation is the reduced amount of P355,401.30; and, that he be given time, up toSeptember, 1985, to dispose of his property in Mindoro, to enable him to pay his accountability,aside from his property in Quezon City which is also for sale (p. 237, L-38655, rec.).

The Solicitor General filed its manifestation and motion in lieu of reply on August 30, 1985 incompliance with Our resolution of June 27, 1985. In the above pleading, the Solicitor Generalsubmits that reply to the manifestation and or comment of Arbiter Valenzuela should be referred tothe Ministry of Labor and Employment since the said ministry, has direct supervision and controlover Valenzuela and it possesses the resources the veracity of his explanations. The SolicitorGeneral further resources with which to conduct an exhaustive investigation her manifests that withrespect to the comment of Atty. Jose Espinas on the two motions for reconsideration of Atty. Pineda

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he received a copy of such comment as early as July 1, 1985 and hence, he was then able toincorporate some of Atty. Espinas' observations to which he concurs in his consolidated comment onthe same two motions which was later filed on July 23, 1985. With regard to the comment of Atty.Espinas on the manifestation of Atty. Pineda, he reiterates his submission that the MOLE is in abetter position to investigate the veracity of Valenzuela's claim, and also to appreciate theobservations and conclusions of Atty. Espinas on such claims.

He therefore prays to be excused from filing a reply (p. 243, L-38655 rec.).

We will first tackle the two motions for reconsideration of B.C. Pineda. WE intend to treat separatelythe manifestation and/or comment of Labor Arbiter Raymundo

The two motions for reconsideration of Atty. B.C. Pineda And the supplement thereto seeking areconsideration of Our resolution dated April 30, 1985 and praying for relief from contumacy arewithout merit.

In the aforecited resolution We have clearly established the continued defiance by contemnorPineda of Our previous resolutions of September 1 and 13, 1983. and adjudged him guilty of the

indirect contempt charge.

WE stand firm on Our pronouncements in the April 30, 1985 resolution which We restate hereunder:

For civil contempt, Section 7, Rule 71 of the Revised Rules of court explicitlyprovides:

Sec. 7, Rule 71 Imprisonment until order obeyed. When thecontempt consists in the omission to do an act which is vet in thepower of the accused to perform, he may be imprisoned by order of asuperior court until he performs it.'

Thus, in the case of Harden vs. Director of Prisons (L-234981 Phil. 741 [Oct. 22,1948]), where petitioner was confined in prison for contempt of court, this Court, indenying the petition and resolving the question of petitioner's indefinite confinement,had the occasion to apply and clarify the aforequoted provision in tile following tenor:

The penalty complained of is neither cruel, unjust nor excessive. InEx-parte Kemmler 136 U.S. 436, the United States Supreme Courtsaid that punishments are cruel when they involve torture or alingering death, but the punishment of death is not cruel, within themeaning of that word as used in the constitution. It implies theresomething inhuman and barbarous, something more than theextinguishment of life.

The punishment meted out to the petitioner is not excessive. It issuitable and adapted to its objective: and it accords with Section 7,Rule 64 of the Rules of Court which provides that "when the contemptconsists in the omission to do an act which is vet in the power of theaccused to perform, he may be imprisoned by order of a superiorcourt until he performs it.

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If the term of imprisonment in this case is indefinite and might last through the naturallife of the petitioner, vet by the terms of the sentence the way is left open for him toavoid serving any part of it by complying with the orders of the court, and in tomanner put an end to his incarceration. In these circumstances, the judgment cannotbe said to be excessive or unjust (Davis vs. Murphy [1947], 188 P. 229-231). Asstated in a more recent case (De Wees [1948], 210 S.W., 2d, 145-147), "to order that

one be imprisoned for an indefinite period in a civil contempt is purely a remedialmeasure. Its purpose is to coerce the contemnor to do an act within his or her powerto perform, He must have the means by which he may purge himself of thecontempt." The latter decision cites Staley vs. South Jersey Realty Co., 83 N.J. Eq.,300, 90 A., 1042, 1043, in which the theory is expressed in this language:

In a civil contempt the proceeding is remedial, it is a step in the case the object ofwhich is to coerce one party for the benefit of the other party to do or to refrain fromdoing some act specified in the order of the court. Hence, if imprisonment beordered, it is remedial in purpose and coercion in character, and to that end mustrelate to something to be done by the defendant by the doing of which he maydischarge himself, As quaintly expressed, the imprisoned man "carries the keys tohis prison in his own pocket" (pp. 747-748).

Likewise, American courts had long enunciated these rulings:

The commitment of one found in contempt of a court order only until the contemnorshall have purged himself of such contempt by complying with the order is a decisivecharacteristic of civil contempt,Maggio v. Zeitz 333 US 56, 92 L. ed, 476, 68 S Ct401.

Civil or quasi-criminal contempt is contemplated by a statute providing that if anyperson refused to obey or perform any rule, order, or judgment of court, such courtshall have power to fine and imprison such person until the rule, order or judgmentshall be complied with. Evans v. Evans, 193 Miss 468, 9 So 2d. 641. [17 Am. Jur. 2d](pp, 418-420, L-27773 rec., emphasis supplied).

This Court takes note of the fact that in compliance with its resolution dated October 18, 1983, Labor Arbiter Antonio Tria Tirona of the NLRC, after due hearing where all the parties concerned werepresent, issued an order on April 24, 1985 definitely fixing the percentages to which the union andthe lawyers should be entitled. The dispositive portion of the said order thus provides:

Wherefore, based on the records and the participation of all the lawyers in the case, Atty. Espinas is entitled to attorney's fees equal to 7% of the total proceeds of thesale; Atty. Lopez 35% and Atty. Pineda 10%. The excess of 15% fees on the 35%fees charged should be refunded to the union for distribution to its members. Nothaving complied with the mandatory restraining order of the Supreme Court on

September 1, 1983, Atty. Benjamin C. Pineda is directed to deposit 25% out of the35% collected by him as fees (minus P2,022.70 previously deposited by the ManilaBank for his account) with the commission for proper disposition.

The aforesaid apportionment is fair and reasonable. Atty. Pineda collected the amount of P712,992.00 or 35% of the selling price of P2,037,120.00.

Since his share in the fees is only P203,712.00, which is 10% of P2,037,120.00, Atty. Pineda is nowaccountable for and should return the following amounts to:

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1. Atty. Jose Espinas P14259840 or 7% of P2,037,120.00

2. Atty. Pedro Lopez P61,113.60 or 3% or 3% P2,037, 120.00

3. Union P305,568.00 or 15% of P2,037,120.00

The total amount, therefore, which contemnor Pineda should account for is P509,280.00 (before anyremittance or payments were made). By far lie has only paid or remitted thru NLRC P2,022.70 plusP50,000.00 (to Atty. Espinas) plus P20,000.00 (to Atty. Lopez) as per as allegation in his secondmotion for reconsideration filed on June 6, 1985, or a total or P72,022.70.

Evidently, it appears from the within records that contemnor Pineda is still far from returning theremaining accountability of P437,257.80, exclusive of interests. He has not even satisfied 15% of theoriginal accountability of P509,280.00. Deliberately or inadvertently, contemnor failed to include inhis accounting (reflected in his second motion for reconsideration? the amount of P305,568.00 whichcorresponds to the 15% Secs collected beyond the 20% allowed for attorney's fees. Likewise, thewithin records bring out the fact that the amount of P101,856.00 which contemnor Pineda allegedlydonated to the. Union was actually taken from the purchase price of P2,037,120.00 and not from

P712,992.00 which he originally collected.

From the foregoing, contemnor Pineda has miserably failed to commonly with Our resolution dated April 30, 1985. For such non-compliance or better still, for not fully performing the act required ofhim, he cannot as yet purge himself of contumacy

For, it is clear from the provision of Section 7, Rule 17 of the Revised Rules of Court that therationale behind the punishment of the contemnor is for him to make complete restitution to the partyinjured by the violation of an order. Thus, if the contumacious act consists in the failure to perform anact or obligation which is yet in the power of the contemnor to do, he may be imprisoned indefinitelyuntil full and complete compliance with our order or resolution.

The essence of the imposition of an indefinite imprisonment on the contemnor is the ultimate andtotal performance of an obligation required by an order of a superior court. This is why contumacyshould be indivisible it cannot be the subject of piece-meal compliance; otherwise, the very reasonfor which it is imposed, which is the complete compliance with an order, would be defeated. Courtorders and injunctions would be easily defied or ignored by litigants if, every time a contemnorpartially satisfies the same, he would be released from the contempt charge. This premature purgingof contumacy would not prevent the other party from filing another motion for contempt and thiswould naturally result in endless litigations. hence, unless and until our courts show they meanbusiness in exacting. full compliance with their orders, the contempt of court might, become a futileexercise of judicial power. And eventually, litigants and their counsel might lose respect for ourcourts.

Significantly, some American courts have the following pronouncements on the matter. Thus:

Except where the fundamental power of the court to imprison for contempt has beenrestricted by statute, and subject to constitutional prohibitions, where a contemnorfails or refuses to obey an order of the court for the payment of money lie may beimprisoned to compel obedience to such order. [Fla. Revell v. Dishong 175 So. 129Fla. 9; Va Branch v. Branch, S.E. 303; 144 Va. 244]. (17 C.J.S. 287).

xxx xxx xxx

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...It has been said that imprisonment for contempt as means of coercion for civilpurpose cannot be resorted to until all other means fail [Mich. Atchison, etc. R. Co.v. Jennison, 27 N.W. 6, 60 Mich. 232], but the court's power to order the contemnor'sdetention continues so long as the contumacy persists [Ark. Lane v. Alexander, 271S.W. 710, 168 Ark. 700] (17 C.J.S. 289).

Even as contemnor Atty, Pineda pleads good faith in having committed the contumacious acts andoffers contrition, apologies and restitution, such posture is not enough to purge himself of his legaland moral obligations particularly so because he is a counsel for the workers whose interests he isduty bound to protect. Instead, he exploited their ignorance.

What really comes to Our minds now is this question: After all that the contemnor has done, could hestill be considered a competent, trustworthy and decent member of the Bar? Thus, in the case ofBorromeo vs. Court of Appeals (L-39253, 87 SCRA 67 [November 24, 1978]), this Court had thecandor to say that good faith alone is not a ground for exoneration of the contempt charge.

Nevertheless, We are constrained to point out certain observations on and assessment of themanifestation and/or comment of Arbiter Valenzuela which has been addressed to this Court.

Offhand, his allegations therein suffer from flaws and unwarranted assumptions, evenmisrepresentations.

Thus, when Arbiter Valenzuela quoted the inscription at the back of the Transfer Certificate of Titlerelative to attorney's lien, he did not put the complete wording which should include the words " andother counsel in CIR Case No. 1099-B " after the words "attorney's hen." Without the completeinscription, one would get the impression that there were no other lawyers in the transaction.

Then again, Arbiter Valenzuela did not reveal the fact that in this Court's decision in L-38655 and L-301 10 dated February 27, 1976, said Court recognized the presence of other lawyers by statingtherein thus: " subject to attorney's liens in favor of Atty. B.C. Pineda and other counsel in said case

pursuant to their retainer contracts " (please see paragraph one, page 6 of manifestation; underliningsupplied).

Arbiter Valenzuela also disclaims that he never determined the extent of attorney's fees in hisquestioned order dated February 9, 1983, when the fact is that in letter (b) of said order's dispositiveportion, he specifically fixed the attorney's lien equivalent to 35% of the total purchase price of theparcel of land in favor of Atty. B.C. Pineda,

It is indeed quite revealing for Arbiter Valenzuela to say that " on the basis of the available recordsthen in the possession of the undersigned Labor Arbiter, and the non-disclosure by A Atty. B. CPineda that there are other lawyers involved " he awarded attorney's fees in favor of contemnorPineda only. This shows that Arbiter Valenzuela issued the two questioned orders on the basis ofpatently wrong assumptions. He assumed that even without the intervention of the NLRC, assuccessor of the CIR, the property could be disposed of. He forgot that there are still existing laws

which should be considered. Again, he erred in assuming that when the motions of Atty. Pineda withannexes were indorsed to him for resolution in 1983, there were no other records which he could digup. He wrongly assumed that just because Atty. Pineda was a "brother in the profession and anOfficer of the Court", the latter's verbal representation that the other records of Case No. 1099-Vcould not be found, should be accepted readily. Finally, when contemnor Pineda's motion filed onDecember 1, 1982 before this Court seeking authority to sell the subject property was merely "noted"by said Court, Arbiter Valenzuela likewise wrongly assumed that his Office had the jurisdiction toauthorize the sale of the same. As a lawyer, he should have known that the word "noted" did not

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mean approval or inaction. He should have filed a motion with this Court for the necessarilyclarification. Instead he acted with precipitate haste.

All the foregoing facts indicate his connivance with Atty. Pineda.

Arbiter Valenzuela now assumes that as such labor arbiter, is empowered under Article 300 of theLabor Code, as amended, to execute final judgments. But a thorough reading of said article does notshow any such provision, which reads thus:

Art. 300. Disposition of pending cases All cases pending before the Court ofIndustrial Relations and the National Labor Relations Commission established underPresidential Decree No. 21 on the date of effectivity of this Code shall be transferredto and processed by the corresponding labor relations divisions or the National LaborRelations Commission created under this Code having cognizance of the same inaccordance with the procedure laid down herein and its implementing rules andregulations. Cases on labor relations on appeal with the Secretary of Labor or theOffice of the President of the Philippines as of the date of effectivity of this Code shallremain under their respective jurisdiction and shall be decided in accordance with the

rules and regulations in force at the time of appeal.

All workmen's compensation cases pending before the Workmen's CompensationUnits in the regional offices of the Department of Labor and those pending before theWorkmen's Compensation Commission as of March 31, 1975, shall be processedand adjudicated in accordance with the law, rules and procedure existing, prior to theeffectivity of the Employees' Compensation and State Insurance Fund.

It is very sad to note that for a lawyer who has served the government for 29 years, ArbiterValenzuela puts up the defense that when he acted on the two motions of Atty. Pineda, he wasprimarily guided by his conscience. Then all of a sudden he says that if there was an error, it was anerror of the mind and not of the heart,

From the foregoing, it appears that Arbiter Valenzuela failed to observe the degree of prudenceexpected of him as a government lawyer of 29 years. When the motions of Atty. Pineda wereindorsed to him for proper action, he should have first exhausted all efforts in locating orreconstructing the records upon as discovery that the same were incomplete. He should haveinformed as superior officer or the one who assigned to him the motions that the records werelacking. He should have initiated a reconstitution of the records by requiring all the lawyers in thecase to produce their own records or have sought their assistance in locating the records,

It took Atty. Espinas and some workers to locate and produce such records. Arbiter Valenzuela'sacts may be treated as nonfeasance and gross neglect of duty.

WHEREFORE, THE MOTIONS FOR RECONSIDERATION OF ATTY. BENJAMIN C. PINEDA AREHEREBY DENIED FOR LACK OF MERIT. FOR CONTEMPT OF COURT, HE IS ORDEREDIMPRISONED IN THE MANILA CITY JAIL UNTIL HE COMPLIES FULLY WITH THE RESOLUTIONOF THIS COURT DATED APRIL 30,1985.

EIGHT (8) MEMBERS OF THE COURT VOTED TO DELETE THE THIRD PARAGRAPH ON PAGE30 OF THE RESOLUTION OF APRIL 30,1985, WHICH READS AS FOLLOWS:

LABOR ARBITER RAYMUNDO VALENZUELA SHOULD BE MADE TO ANSWERFOR HAVING ACTED WITHOUT OR BEYOND HIS AUTHORITY IN PROPER

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ADMINISTRATIVE CHARGES, HE COULD ALSO BE PROSECUTED BEFORETHE TANODBAYAN UNDER THE PROVISIONS OF THE ANTI GRAFT LAW,INDEPENDENTLY OF HIS LIABILITIES AS A GOVERNMENT OFFICER ' HECOULD BE THE SUBJECT OF DISBARMENT PROCEEDINGS UNDER SECTION27, RULE 138 OF THE REVISED RULES OF COURT.

LET COPIES OF THIS RESOLUTION BE FURNISHED THE MINISTRY OF LABOR ANDEMPLOYMENT AND THE TANODBAYAN FOR APPROPRIATE ACTION,

Teehankee, J., reserves his vote.

Aquino and Plana, JJ., took no part.

Gutierrez, Jr., took no part as regards Atty. Pineda.

Melencio-Herrera and Relova, JJ., are on leave.

Separate Opinions

ESCOLIN, J., concurring:

I concur but not on the findings as to Labor Arbiter Valenzuela.

CUEVAS, J., concurring:

I concur but vote to reconsider that portion adversely affecting Arbiter Valenzuela.

ALAMPAY, J ., concurring:

I vote to reconsider the portions of our Resolution of April 30, 1985, adversely affecting Labor ArbiterRaymundo Valenzuela.

In the Manifestation and/or Comment [dated 17 June, 1985] of Labor Arbiter Raymundo F.

Valenzuela, he prays that this Court reconsider and set aside that portion of our Resolutionpromulgated on April 30, 1985 wherein it is stated that "Labor Arbiter Raymundo Valenzuela shouldbe made to answer for having acted without or beyond his authority in proper administrative charges.He could also be prosecuted before the Tanodbayan under the provisions of the Anti-Graft Law.Independently of his liabilities as a government officer, he could be the subject of disbarmentproceedings under Section 27, Rule 138 of the Revised Rules of Court." (pg. 30, Resolution of April30, 1985).

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The dispositive portion of the aforestated resolution does not carry any mandatory directive thatdisciplinary action should be formally taken against him. Nevertheless, said Labor Arbiter feltimpelled to submit to this Court a "Manifestation and/or Comment" to the said Resolution of April 30,1985, wherein he