Tipawan v. Gerochi

FIRST DIVISION

[A.C. No. 7381. October 7, 2020.]

CUSTODIA N. TIPAWAN, complainant, vs. ATTY. ROMEO P. GEROCHI, respondent.

NOTICE

Sirs/Mesdames :

Please take notice that the Court, First Division, issued a Resolution dated October 7, 2020 which reads as follows:

"A.C. No. 7381 —Custodia N. Tipawan v. Atty. Romeo P. Gerochi

Antecedents

Complainant Custodia N. Tipawan filed a disbarment case against respondent Atty. Romeo P. Gerochi for conflict of interest, deceit, grossly unethical conduct, malpractice, and betrayal of trust.

In her Affidavit-Complaint, Tipawan essentially alleged:

She was the registered owner of Lot 3775-A covered by Transfer of Certificate of Title No. (TCT) EPT-150 and Lot 3775-B covered by TCT EPT-151. The properties are located in Brgy. Nabitasan, La Paz, Iloilo City. 1

On January 5, 2005, she engaged the services of respondent to protect her rights and interest over said properties. For this purpose, a Retainership Agreement was executed between her and respondent. 2

On January 17, 2005, she entered into a Contract to Sell with Spouses Nestor Espinosa and Alicia Espinosa (Spouses Espinosa) over a three thousand (3,000) sq.m. portion of Lot 3775-A at Three Thousand (P3,000.00) per sq.m. or a total of Nine Million Pesos (P9,000,000.00). 3

Meantime, on March 8, 2004, she sold to Spouses Lorenzo Coloso, Jr. and Virginia Coloso (Spouses Coloso) a separate three thousand (3,000) sq.m. portion identified as Lot 3775-A-2. Eventually, TCT 155489 was issued in the name of Spouses Coloso. 4

After the title was issued to Spouses Coloso, respondent strangely insisted that Lot 3775-A-2 was the same portion of lot subject of her Contract to Sell with Spouses Espinosa. 5

Due to respondent's failure to protect her property rights, she terminated the retainership agreement with him effective October 12, 2005. 6

On July 3, 2006, Spouses Espinosa, represented by respondent, filed a complaint for specific performance, nullity of title, damages with prayer for preliminary injunction against complainant and Spouses Coloso on ground of double sale. The case was raffled to the Regional Trial Court (RTC)-Branch 35, Iloilo City. 7

Respondent likewise filed a complaint for legal redemption dated October 20, 2006 on behalf of Zenaida Bales and Letty Bales de los Santos against her and her co-heirs over subject Lot 3775-A. The case was raffled to RTC-Branch 33, Iloilo City. 8

Respondent's act of initially representing her to protect her rights over Lot 3775-A and now suing her for the same property was clearly a conflict of interest. The cases filed by respondent were even based on the same documents she entrusted him as her counsel. 9

In compliance with the Court's Resolution dated February 5, 2007, respondents filed his comment, 10 refuting the charges. He said the Spouses Espinosa were his close family friends. Prior to the execution of the Contract to Sell with complainant, Spouses Espinosa consulted him on their plan to buy a portion of Lot 3775-A from complainant. He told them that there was a prior sale of an undivided and unsegregated portion of said lot to Spouses Coloso. Thus, he advised Spouses Espinosa to make a down payment for the portion of lot and only pay in full after the title had been released to them. 11

On October 12, 2005, complainant had terminated the retainership agreement between her and himself. Thus, when he filed the complaint for nullity of title on behalf of Spouses Espinosa on July 3, 2006, he was no longer the counsel of complainant. 12

He, thus, had an obligation to protect the rights and interests of Spouses Espinosa since they already paid Three Million Pesos (P3,000,000.00) to complainant. 13

Finally, while lawyer-client relationship was not dependent on payment of fees, complainant here had never paid him for his services. 14

The case was referred to the Integrated Bar of the Philippines (IBP) for investigation and report.

Meantime, on January 7, 2009, complainant's representative Myrna Tipawan Parita formally informed the IBP of complainant's death on November 13, 2007. She, nonetheless, expressed that the heirs of complainant wanted to pursue the case against respondent. 15

During the investigation before the Investigating Commissioner, respondent filed his position paper reiterating his allegations in the answer.

The Report and Recommendation of the IBP

In his Report and Recommendation 16 dated December 6, 2017, the Investigating Commissioner found respondent guilty of representing conflicting interest and recommended his suspension from the practice of law for one (1) year.

The Investigating Commissioner opined that respondent was bound to protect the interests of complainant despite termination of their retainership agreement. For the trust and confidence reposed upon him by complainant was not extinguished with the termination of the legal relationship between them.

The rule prohibits a lawyer from representing new clients whose interests oppose those of a former client in any manner. By representing Spouses Espinosa on a complaint against complainant, respondent violated the rule against conflict of interest. 17

As for the absence of legal fees paid to respondent, the same does not exempt lawyers from complying with the prohibition against pursuing cases with conflict of interests. The prohibition attaches the moment the attorney-client relationship is established and extends beyond the duration of the professional relationship. 18

By Resolution dated June 29, 2018, the IBP Board of Governors adopted the aforesaid Report and Recommendation. 19

Respondent's motion for reconsideration was denied under Resolution dated June 17, 2019. 20

Ruling

We adopt in full the IBP's factual findings and legal conclusions.

Rule 15.03, Canon 15 of the Code of Professional Responsibility (CPR) ordains:

Canon 15 — A lawyer shall observe candor, fairness and loyalty in all his dealings and transactions with his clients.

xxx xxx xxx

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

A lawyer is therefore prohibited from representing new clients whose interests oppose those of a former client in any manner, whether or not they are parties in the same action or on totally unrelated cases. 21

Paces Industrial Corporation vs. Atty. Salandanan22 enunciated:

Conflict of interest exists when a lawyer represents inconsistent interests of two or more opposing parties. The test is whether or not in behalf of one client, it is the lawyer's duty to fight for an issue or claim, but it is his duty to oppose it for the other client. In short, if he argues for one client, this argument will be opposed by him when he argues for the other client. This rule covers not only cases in which confidential communications have been confided, but also those in which no confidence has been bestowed or will be used. Also, there is conflict of interests if the acceptance of the new retainer will require the attorney to perform an act which will injuriously affect his first client in any matter in which he represents him and also whether he will be called upon in his new relation to use against his first client any knowledge acquired through their connection. Another test of the inconsistency of interests is whether the acceptance of a new relation will prevent an attorney from the full discharge of his duty of undivided fidelity and loyalty to his client or invite suspicion of unfaithfulness or double-dealing in the performance of said duty. The prohibition is founded on the principles of public policy and good taste.

Here, records show that on January 5, 2005, complainant hired respondent to protect her property rights and interests. On October 12, 2005, complainant terminated the services of respondent.

Meantime, on January 17, 2005, complainant and Spouses Espinosa entered into a Contract to Sell covering a portion of complainant's properties. Later, however, Spouses Espinosa claimed that the portion of the lot subject of the Contract to Sell was the same portion of lot sold to Spouses Coloso and covered by TCT 155489 under the latter's name. Thus, Spouses Espinosa, represented by respondent, filed a complaint against complainant and Spouses Coloso for nullity of title, specific performance, and damages on ground of double sale.

Notably, the property subject of the retainership agreement between complainant and respondent, on one hand, and the property subject of the complaint for nullity of title filed by respondent on behalf of Spouses Espinosa against complainant are one and the same. Verily, respondent's duty to protect complainant's rights and interest over her properties runs counter to his subsequent act of filing of a complaint for nullity of title, specific performance, and damages against complainant herself involving one of these properties. This is conflict of interest plain and simple.

In Tulio v. Atty. Buhangin, the Court decreed that Atty. Buhangin took an inconsistent position when he filed Civil Case No. 6185-R for rescission of the deed of waiver of rights against Tulio whom he had defended and protected as his client in the past. 23

Applying Tulio here, respondent, by initiating the complaint for Spouses Espinosa against complainant, is liable for representing conflicting interests since he had taken a stand directly contrary to his duty to protect the rights and interest of complainant over her properties.

Respondent, nonetheless, insists that there was no conflict of interest because he was no longer complainant's counsel when he filed the complaint against her on behalf of Spouses Espinosa.

Respondent is mistaken. Canon 21 of the Code of Professional Responsibility expressly declares that "[a] lawyer shall preserve the confidences and secrets of his client even after the attorney-client relation is terminated." The rationale for this rule is that the client's confidence once given should not be stripped by the mere expiration of the professional employment. Thus, the termination of the attorney-client relationship does not justify a lawyer to represent an interest adverse to or in conflict with that of the former client. The protection given to the client is perpetual and does not cease with the termination of the litigation, nor is it affected by the client's ceasing to employ the attorney and retaining another, or by any other change of relation between them. It even survives the death of the client. 24

Consequently, the termination of the attorney-client relationship between complainant and respondent does not excuse the latter's representation of Spouses Espinosa in a case which directly attacked complainant's property rights and interests which under the retainer's agreement in question, he was duty bound to protect.

On another point, in the absence of complainant's express consent after full disclosure of the conflict of interest, respondent should have either outrightly declined representing and entering his appearance as counsel for Spouses Espinosa or advised the latter to simply engage the services of another lawyer. Respondent, unfortunately, did neither.

On the contrary, he even asserted that since Spouses Espinosa were his family friends, he had an obligation to represent them and protect their rights. The argument must fail. In Tulio, the Court emphasized that the representation of conflicting interest is in good faith and with honest intention on the part of the lawyer does not make the prohibition inoperative. 25

Indeed, a lawyer owes fidelity to the cause of his client and shall be mindful of the trust and confidence reposed on him. 26 By representing Spouses Espinosa on a complaint against complainant, respondent had utterly failed to uphold his duty to protect complainant even beyond the duration of their professional relationship. Respondent is liable for representing conflicting interests.

As for the absence of any monetary consideration for the retainer's agreement, the IBP correctly ruled that the same does not exempt lawyers from complying with the prohibition against pursuing cases with conflicting interests. Thus, the alleged failure of complainant to pay respondent his professional fee will not exculpate him from liability. 27

On the penalty, the Court has sound judicial discretion to impose penalty on erring lawyers. In similar cases, as in here, the Court imposed penalties ranging from reprimand to suspension, or even disbarment in aggravated cases. 28

In Samson v. Atty. Era, the Court found Atty. Era liable for representing conflicting interest in violation of the Code of Professional Responsibility and suspended him from the practice of law for two (2) years with warning that a repetition of the same or similar acts in the future will be dealt with more severely. 29

The Court in Casto-Justo v. Atty. Galing suspended the erring lawyer from the practice of law for one (1) year for representing conflicting interest. 30

Also in Tulio v Atty. Buhangin, respondent lawyer was likewise held liable for representing conflicting interest. The Court suspended Atty. Buhangin from the practice of law for six (6) months with warning that a repetition of the same or similar acts in the future will be dealt with more severely. 31

Here, considering that this is respondent's first offense, the penalty of SUSPENSION from the practice of law for one (1) year is deemed proper. ACCORDINGLY, Atty. Romeo P. Gerochi is found GUILTY of representing conflicting interests in violation of Rule 15.03, Canon 15 of the Code of Professional Responsibility. He is SUSPENDED from the practice of law for ONE (1) YEAR effective upon receipt of this Resolution. He is required to inform the Court of the date of his receipt hereof within five days from notice.

Let a copy of this Resolution be entered in the personal records of Atty. Romeo P. Gerochi as member of the Bar, and copies furnished the Office of the Bar Confidant, the Integrated Bar of the Philippines, and the Office of the Court Administrator for circulation to all courts in the country.

SO ORDERED."

By authority of the Court:

(SGD.) LIBRADA C. BUENADivision Clerk of Court

by:

MARIA TERESA B. SIBULODeputy Division Clerk of Court

 

Footnotes

1.Rollo, p. 3.

2.Id.

3.Id.

4.Id.

5.Id.

6.Id. at 4.

7.Id.

8.Id.

9. Id. at 5.

10.Id. at 105.

11.Id. at 131.

12.Id. at 133-134.

13.Id. at 134.

14.Id. at 139.

15.Id. at 184.

16.Id. at 284-298.

17.Id. at 292-296.

18.Id. at 297.

19.Id. at 282.

20.Id. at 314.

21.Samson v. Atty. Era, 714 Phil. 101, 111 (2013).

22. 814 Phil. 93, 98-99 (2017).

23. 785 Phil. 292, 295 (2016).

24.Supra note 21, at 112-113.

25.Supra note 23, at 300-301.

26.Id. at 301.

27.Castro-Justo v. Galing, 676 Phil. 139, 144 (2011).

28.Venterez v. Atty. Cosme, 561 Phil. 479, 490 (2007).

29.Supra note 24, at 113.

30.Supra note 27, at 146.

31.Supra note 23, at 302.