SECOND DIVISION
[A.C. No. 6349. February 22, 2017.]
LEOPOLDO GONZAGA, petitioner,vs. ATTY. RODOLFO B. TA-ASAN, JR., respondent.
NOTICE
Sirs/Mesdames :
Please take notice that the Court, Second Division, issued a Resolution dated 22 February 2017 which reads as follows: ATICcS
"A.C. No. 6349: LEOPOLDO GONZAGA v. ATTY. RODOLFO B. TA-ASAN, JR.
This case involves a lawyer's failure to account for or to return money he received on behalf of his client, in violation of Canon 16 of the Code of Professional Responsibility.
Complainant Leopoldo Gonzaga (Gonzaga) filed a Complaint-Affidavit 1 dated March 18, 2004 against respondent Atty. Rodolfo B. Ta-asan, Jr. (Atty. Ta-asan), before the Office of the Court Administrator. He alleged that he obtained the services of Atty. Ta-asan as legal counsel in several collection cases against his former customers. 2 One of the cases he filed was for violation of Batas Pambansa Blg. 22 against the spouses Jun and Ernina Cagas (Cagas Spouses). 3 Gonzaga and the Cagas Spouses agreed to settle the case amicably. 4 The Cagas Spouses were given until April 15, 2004 to fully pay their debt to Gonzaga. 5 In one of the collection case hearings in January 2004, the Cagas Spouses approached Gonzaga to inquire on why he was still interested in pursuing the case despite their payment to Atty. Ta-asan of P9,000.00 in May 2002. 6 Gonzaga claimed that he was not informed that this amount had been received by his then counsel and that he had not received the alleged payment. 7 As evidence of payment, however, the Cagas Spouses showed Gonzaga receipts issued by the office of Atty. Ta-asan. 8
In his Complaint, Gonzaga admitted that Atty. Ta-asan no longer represented him in his collection cases as he had been unable to pay Atty. Ta-asan's fees. 9 Atty. Ta-asan's demand for the payment of attorney's fees were stated and reiterated in two letters received by Gonzaga. In the letter 10 dated November 6, 2003, Atty. Ta-asan reminded Gonzaga to settle his accountabilities and informed him that he had collected the amount of P9,000.00 from his debtors, namely Mary Maude Tiongson, Lito Bautista, Liza Impis, Lilia Alcachopas, Armando Susmiran, and Clarita Torres. Atty. Ta-asan asked if he could apply the collected amount against the unpaid attorney's fees. 11 However, no arrangement was finalized to offset Gonzaga's accountabilities with the collected amount. In the letter 12 dated January 6, 2004, Atty. Ta-asan again reminded Gonzaga to fully settle his accountabilities. This time, Atty. Ta-asan applied the collected P9,000.00 against Gonzaga's accountabilities without the latter's permission. 13
Gonzaga stated that in spite of his willingness to settle his account with Atty. Ta-asan, the failure to recover his investment in any of the collection cases handled by Atty. Ta-asan made Gonzaga hesitate to do it. 14 Gonzaga learned from one of the letters that the P9,000.00 collected by Atty. Ta-asan was applied as payment of attorney's fees. 15 ETHIDa
Gonzaga also alleged that the non-payment of fees could have been the reason why Atty. Ta-asan recommended that the collection cases be handled by a Tagum-based lawyer instead. 16 Gonzaga prayed that Atty. Ta-asan be administratively disciplined by this Court for violating Canon 16 of the Code of Professional Responsibility. 17
In his Comment 18 dated July 29, 2004, Atty. Ta-asan admitted that after sending a demand letter to the Cagas Spouses for their five bounced checks, the latter remitted to his office, on two separate occasions, the total amount of P9,000.00 as partial payment. 19 The payments were received by the secretary of Atty. Ta-asan's law office, Mary Jane Castillote, and were properly issued receipts. 20 Atty. Taasan claimed that the payments were deposited to Gonzaga's bank account and that Gonzaga was duly informed of the payment. 21 Atty. Ta-asan alleged that Gonzaga initially refused to receive the P9,000.00 as this was insufficient to cover the whole obligation. 22 Later, he instructed that the payment made by the Cagas Spouses be applied to his obligation to Atty. Ta-asan. 23 After a few months, criminal cases were filed against the Cagas Spouses when they failed to pay the balance. 24
More than a year after the institution of the case against the Cagas Spouses, Ernina Cagas (Ernina) demanded the return of the P9,000.00 as "she cannot be bound by the parties' prior arrangement in 2002 to apply the same to Gonzaga's then unpaid accounts." 25 The amount was returned to the Cagas Spouses, and this was reported in court through a Manifestation signed by both Atty. Ta-asan and Ernina. 26
The other debtors of Gonzaga also made partial payments, which totaled P9,000.00, through Atty. Ta-asan. 27 These were itemized in the Statement of Account attached to the November 6, 2003 letter of Atty. Ta-asan to Gonzaga. 28
Finally, Atty. Ta-asan argued that his withdrawal as Gonzaga's counsel was justified. He averred that he was charged in a criminal case for falsification of document due to "a spurious and falsified Business Permit and License" provided by Gonzaga. 29 Atty. Ta-asan allegedly suffered "gross humiliation, undue embarrassmen[t] and traumatic sleepless nights[.]" 30 Gonzaga also urged Atty. Ta-asan to file an unfounded disbarment case against a prosecutor involved in one of the collection cases and a motion for inhibition against the presiding judge where some of his cases were raffled. 31 Atty. Ta-asan's withdrawal as counsel was also due to Gonzaga's failure to pay the balance of P141,500.00 for legal services. 32 TIADCc
Investigating Commissioner Oliver A. Cachapero (Commissioner Cachapero) was of the position that the Complaint should be dismissed for lack of merit. In his Report and Recommendation 33 dated March 12, 2012, he stated:
[N]ot any single document shows that Respondent had appropriated the amount to himself or automatically credited the same as payment of his agreed attorney's fees with Complainant. If at all, it was only Complainant's say so or bare allegation that was presented to prove that the Respondent had supposedly appropriated the amount to himself.
In any event, the Respondent's letters asking for the setting-off of the P9,000.00 to his attorney's fees and Manifestation are instructive. In the letters, it was clear that Respondent sought approval of the set-off. In the Manifestation, however, the propose[d] set-off was rendered moot because Respondent returned the amount of P9,000.00 to Ernina Cagas, the other half of the Cagas Spouses, before the filing of the instant complaint. Ernina Cagas acknowledged her receipt of the same by affixing her signature in the document.
Thus, it is clear, that Respondent did not keep or appropriate the P9,000.00 to himself. His returning the same through [sic] quite late is indisputably a gesture of good faith particularly of his lack of intent to appropriate the same. To the undersigned, his returning the amount had validated Respondent's earlier claim that Complainant had rejected the payment and refused to accept the same because it was a mere pittance compared with what the Cagas Spouses were supposed to pay which is P81,670.00. This prompted Respondent to deposit the amount, as he had claimed, in the account of his office and not in his own personal account.
As to the Respondent's withdrawal as counsel for Complainant, the undersigned finds the reason advance by Respondent in his letter to be in accord with law. He was sued along with Complainant for a document the latter had furnished him. Also, he was asked by Complainant to inhibit the judge from hearing his case and file an unfounded disbarment case against Prosecutor Divina T. Samson without valid reason. These twin actions are apparently unjust and clearly Respondent was being asked to allow himself to be a party to his client's scheme to defraud or to unduly make the adverse party suffer. Under this scenario, Complainant is allowed to retire from the litigation as he in fact did. He did it right because as jurisprudence had enshrined, an attorney who continues representing a client notwithstanding the occurrence of any of the valid grounds for withdrawal opens himself to possible disciplinary action by the court. 34 (Citations omitted, emphasis in the original) cSEDTC
The Board of Governors of the Integrated Bar of the Philippines (Board of Governors) passed a Resolution 35 dated March 20, 2013, adopting with modification the Report and Recommendation of Commissioner Cachapero:
RESOLUTION NO. XX-2013-226
RESOLVED to ADOPT and APPROVE, as it is hereby unanimously ADOPTED and APPROVED, with modification, the Report and Recommendation of the Investigating Commissioner in the above-entitled case, herein made part of this Resolution as Annex "A", and finding the recommendation fully supported by the evidence on record and the applicable laws and rules and considering that Respondent received the amount of P9,000.00 in trust for his client but did not disclose the same and complainant came to know about it only after 2 years and the money received by respondent as settlement of the case was made without the knowledge and consent of complainant, Atty. Rodolfo B. Ta-asan Jr. is hereby sternly Warned to be more circumspect in his dealings and repetition of the same acts shall be dealt with more severely. 36 (Emphasis in the original)
Gonzaga filed a Motion for Reconsideration, 37 which was opposed 38 by Atty. Ta-asan.
The Board of Governors favorably considered Gonzaga's Motion for Reconsideration in its Extended Resolution 39 dated June 2, 2014. It stated that Atty. Ta-asan must be admonished:
Complainant's allegation is consistent with the evidence on hand. Complainant's Annex "B" [referring to the November 6, 2003 letter of Atty. Ta-asan with an attached Statement of Accounts] indicates that respondent would put into writing the payments he had received from complainant's debtors so it stands to reason that the Php9,000.00 would have been properly documented as well. But respondent could not show any letter or receipt given to complainant of the Php9,000.00 payment. It also follows that with respondent's failure to account for the Php9,000.00, he would have as well failed to inform complainant of the settlement of the case. 40 AIDSTE
The Board of Governors passed a new Resolution 41 dated May 3, 2014:
RESOLUTION NO. XXI-2014-253
Leopoldo Gonzaga vs.
RESOLVED to GRANT Complainant's Motion for Reconsideration, considering Respondent's failure to account and return promptly the money that came into his possession for his client, the Complainant, and for disclosing the settlement of the case he handled for said Complainant only after two years. Thus, Resolution No. XX-2013-226 dated March 20, 2013 is hereby REVERSED and SET ASIDE and accordingly Atty. Rodolfo B. Ta-asan, Jr. is ADMONISHED. 42 (Emphasis in the original)
For resolution is the issue of whether respondent is guilty of violating Canon 16 of the Code of Professional Responsibility.
The pertinent rules of Canon 16 of the Code of Professional Responsibility read:
Canon 16 — A lawyer shall hold in trust all moneys and properties of his client that may come into his possession.
Rule 16.01 A lawyer shall account for all money or property collected or received for or from the client.
xxx xxx xxx
Rule 16.03 A lawyer shall deliver the funds and property of his client when due or upon demand. However, he shall have a lien over the funds and may apply so much thereof as may be necessary to satisfy his lawful fees and disbursements, giving notice promptly thereafter to his client. He shall also have a lien to the same extent on all judgments and executions he has secured for his client as provided for in the Rules of Court.
It is well-settled that "[t]he fiduciary nature of the relationship between the counsel and his [or her] client imposes on the lawyer the duty to account for the money or property collected or received for or from his [or her] client." 43 Failure to account for the money or property received is a violation of the trust reposed on the lawyer. 44
It is not disputed that respondent received P9,000.00 from the Cagas Spouses as partial payment of their debt to complainant. However, respondent has contrary claims on what he did with the amount received. SDAaTC
In his Comment, he stated:
On May 3, 2002, the spouses Cagas went to the law office and remitted to respondent's secretary Mary Jane Castillote the amount of P8,000.00 pesos, as partial payment of the obligation. They promised to return and additionally paid P1,000.00 pesos on May 15, 2002. Said payments of P9,000.00 pesos were properly issued receipts . . . by the secretary Ms. Castillote and were deposited in the separate office Client's Account No. 001-1-0016281-9 with Banco Davao, as the respondent personally maintain another separate account with the bank. Unfortunately, no check can be returned to spouses Cagas because, they were all in the possession of complainant Gonzaga.
Contrary to [Gonzaga's] allegation, the respondent Atty. Ta-asan and his secretary Ms. Castillote promptly informed the client Mr. Gonzaga of the partial payment of P9,000.00 pesos made by the spouses Cagas, but the complainant initially refused to receive the money because, it was insufficient for the obligation of P81,670.00. Mr. Gonzaga, who regularly goes to the office weekly to file the other cases, later instructed us that said payment be applied to his unpaid balance of P2,500.00 and in the Cagas case . . . and other accounts . . . in the office.
xxx xxx xxx
. . . [O]n February 3, 2004 or after one (1) year and 3 months, Mrs. Ernina Cagas came to respondent's office for the return to her of the amount of P9,000.00 pesos, which was immediately given her as indicated in the same receipts . . . Said return of P9,000.00 was then reported in court by Manifestation . . . dated February 3, 2004 signed and filed by both the respondent Atty. Ta-asan and Mrs. Ernina F. Cagas. 45 (Emphasis supplied)
First, respondent asserted that complainant was informed of the collection and that the P9,000.00 was deposited in the latter's bank account. These allegations were not supported by any document, receipt, or affidavit that would show that complainant was notified. Evidence to substantiate respondent's claim would have been easy to produce since a law firm would logically keep track or record transactions affecting their clients.
Second, he claimed that he returned the amount to Ernina, upon her demand. If respondent indeed deposited the partial payment of the Cagas Spouses to complainant's bank account, it would not have been possible for him to return it to Ernina. The P9,000.00 would have already been in the possession of complainant. Atty. Ta-asan's act of returning the P9,000.00 to Ernina contradicts his claim that a deposit has been made to complainant's bank account. acEHCD
Respondent's failure to account for the money he received in trust for his client constitutes a violation of Canon 16 of the Rules of Professional Responsibility. His omission, however, justifies the imposition of penalties as severe as disbarment or suspension from the practice of law. Two considerations work in his favor and tilt our appreciation of his actions as not having been tainted by such a degree of malevolence as to warrant the imposition of severe penalties. First is complainant's failure to properly and timely pay his attorney's fees. Second is his act of voluntarily returning the money to the Cagas Spouses.
WHEREFORE, this Court finds Atty. Rodolfo B. Ta-asan, Jr. guilty of violating Canon 16, Rule 16.01 and Rule 16.03 of the Code of Professional Responsibility.
Respondent is hereby ADMONISHED with a WARNING that a repetition of the same or similar act shall be dealt with more severely.
Let a copy of this Resolution be furnished the Office of the Bar Confidant, to be appended to respondent's personal record as attorney, and the Integrated Bar of the Philippines for their information and guidance.
SO ORDERED."
Very truly yours,
MA. LOURDES C. PERFECTODivision Clerk of Court
By:
(SGD.) TERESITA AQUINO TUAZONDeputy Division Clerk of Court
Footnotes
1.Rollo, pp. 2-4.
2.Id. at 2.
3.Id.
4.Id.
5.Id.
6.Id.
7.Id.
8.Id.
9.Id.
10.Id. at 8.
11.Id.
12.Id. at 11.
13.Id. at 3.
14.Id.
15.Id.
16.Id.
17.Id. at 1.
18.Id. at 16-25.
19.Id. at 18.
20.Id.
21.Id.
22.Id.
23.Id.
24.Id.
25.Id. at 19.
26.Id.
27.Id.
28.Id.
29.Id. at 20.
30.Id.
31.Id. at 20-21.
32.Id. at 22.
33.Id. at 606-609.
34.Id. at 608-609.
35.Id. at 605.
36.Id.
37.Id. at 610-618.
38.Id. at 621-622.
39.Id. at 632-635.
40.Id. at 634.
41.Id. at 630-631.
42.Id. at 630.
43.Sison, Jr. v. Camacho, A.C. No. 10910, January 12, 2016 <http://sc judiciary.gov.ph/pdf/web/viewer.html?file=/jurisprudence/2016/january2016/10910.pdf> 8 [Per Curiam, En Banc].
44.Ramos v. Mandagan, A.C. No. 11128, April 6, 2016 <http://sc.judiciary.gov.ph/pdf/web/viewer.html?file=/jurisprudence/2016/april2016/11128.pdf> 4 [Per J. Reyes, Third Division].
45.Rollo, pp. 18-19.