[A. C. No. 5485. March 16, 2005] ELMER CANOY, complainant, vs. ATTY. JOSE MAX ORTIZ, respondent.

DECISION TINGA, J.: There are no good reasons that would justify a lawyer virtually abandoning the cause of the client in the midst of litigation without even informing the client of the fact or cause of desertion. That the lawyer forsook his legal practice on account of what might be perceived as a higher calling, election to public office, does not mitigate the dereliction of professional duty. Suspension from the practice is the usual penalty, and there is no reason to deviate from the norm in this case. A Complaint[1] dated 10 April 2001 was filed with the Office of the Bar Confidant by Elmer Canoy (Canoy) accusing Atty. Jose Max Ortiz (Atty. Ortiz) of misconduct and malpractice. It was alleged that Canoy filed a complaint for illegal dismissal against his former employer, Coca Cola Bottlers Philippines. The complaint was filed with the National Labor Relations Commission (NLRC) Regional Arbitration Board VI in Bacolod City.[2] Atty. Ortiz appeared as counsel for Canoy in this proceeding. In 1998, the labor arbiter hearing the complaint ordered the parties to submit their respective position papers. Canoy submitted all the necessary documents and records to Atty. Ortiz for the preparation of the position paper. Thereafter, he made several unfruitful visits to the office of Atty. Ortiz to followup the progress of the case. After a final visit at the office of Atty. Ortiz in April of 2000, during which Canoy was told to come back as his lawyer was not present, Canoy decided to follow-up the case himself with the NLRC. He was shocked to learn that his complaint was actually dismissed way back in 1998, for failure to prosecute, the parties not having submitted their position papers.[3] The dismissal was without prejudice. Canoy alleged that Atty. Ortiz had never communicated to him about the status of the case, much less the fact that he failed to submit the position paper. The Comment[4] filed by Atty. Ortiz is the epitome of self-hagiography. He informs the Court that since commencing his law practice in 1987, he has mostly catered to indigent and low-income clients, at considerable financial sacrifice to himself. Atty. Ortiz claims that for more than ten years, his law office was a

virtual adjunct of the Public Attorneys Office with its steady stream of nonpaying clients in the hundreds or thousands.[5] At the same time, he hosted a legal assistance show on the radio, catering to far-flung municipalities and reaching the people who need legal advice and assistance.[6] Atty. Ortiz pursued on with this lifestyle until his election as Councilor of Bacolod City, a victory which he generously attributes to the help of the same people whom he had helped by way of legal assistance before.[7] Canoy was among those low-income clients whom Atty. Ortiz deigned to represent. The lawyer was apparently confident that the illegal dismissal case would eventually be resolved by way of compromise. He claims having prepared the position paper of Canoy, but before he could submit the same, the Labor Arbiter had already issued the order dismissing the case.[8] Atty. Ortiz admits though that the period within which to file the position paper had already lapsed. He attributes this failure to timely file the position paper to the fact that after his election as Councilor of Bacolod City, he was frankly preoccupied with both his functions as a local government official and as a practicing lawyer. Eventually, his desire to help was beyond physical limitations, and he withdrew from his other cases and his free legal services.[9] According to Atty. Ortiz, Mr. Canoy should have at least understood that during all that time, he was free to visit or call the office and be entertained by the secretary as [he] would normally report to the office in the afternoon as he had to attend to court trials and report to the Sanggunian office.[10] He states that it was his policy to inform clients that they should be the ones to follow-up their cases with his office, as it would be too difficult and a financial burden to attend making follow-ups with hundreds of clients, mostly indigents with only two office personnel.[11] Nonetheless, Atty. Ortiz notes that the dismissal of Canoys complaint was without prejudice, thus the prescriptive period had been tolled. He claims not being able to remember whether he immediately informed Canoy of the dismissal of the case, though as far as he could recall, Canoy had conveyed a message to him that he had a lawyer to handle the case, thus his office did not insist on refiling the same.[12]

The matter was referred to the Integrated Bar of the Philippines (IBP) for investigation, report and recommendation.[13] Canoy eventually submitted a motion withdrawing the complaint, but this was not favorably acted upon by the IBP in view of the rule that the investigation of a case shall not be interrupted or terminated by reason of withdrawal of the charges.[14] Eventually, the investigating commissioner concluded that clearly, the records show that [Atty. Ortiz] failed to exercise that degree of competence and diligence required of him in prosecuting his clients (sic) claim, and recommended that Atty. Ortiz be reprimanded.[15] The IBP Commission on Discipline adopted the recommendation, with the slight modification that Atty. Ortiz be likewise warned that a repetition of the same negligence shall be dealt with more severely in the future. The Court is sensitive to the difficulties in obtaining legal representation for indigent or low-income litigants. Apart from the heroic efforts of government entities such as the Public Attorneys Office, groups such as the IBP National Committee on Legal Aid and the Office of Legal Aid of the UP College of Law have likewise been at the forefront in the quest to provide legal representation for those who could not otherwise afford the services of lawyers. The efforts of private practitioners who assist in this goal are especially commendable, owing to their sacrifice in time and resources beyond the call of duty and without expectation of pecuniary reward. Yet, the problem of underrepresentation of indigent or low-income clients is just as grievous as that of nonrepresentation. Admirable as the apparent focus of Atty. Ortizs legal practice may have been, his particular representation of Canoy in the latters illegal dismissal case leaves much to be desired. Several of the canons and rules in the Code of Professional Responsibility guard against the sort of conduct displayed by Atty. Ortiz with respect to the handling of Canoys case. CANON 17A LAWYER OWES FIDELITY TO THE CAUSE OF HIS CLIENT AND HE SHALL BE MINDFUL OF THE TRUST AND CONFIDENCE REPOSED IN HIM. CANON 18A LAWYER SHALL SERVE HIS CLIENT WITH COMPETENCE AND DILIGENCE. ...

Rule 18.03A lawyer shall not neglect a legal matter entrusted to him, and his negligence in connection therewith shall render him liable. Rule 18.04A lawyer shall keep the client informed of the status of his case and shall respond within a reasonable time to the clients request for information. ... CANON 22A LAWYER SHALL WITHDRAW HIS SERVICES ONLY FOR GOOD CAUSE AND UPON NOTICE APPROPRIATE IN THE CIRCUMSTANCES. ... Rule 22.02 A lawyer who withdraws or is discharged shall, subject to a retainer lien, immediately turn over all papers and property to which the client is entitled, and shall cooperate with his successor in the orderly transfer of the matter, including all information necessary for the proper handling of the matter. Atty. Ortiz should have filed the position paper on time, owing to his duty as counsel of Canoy to attend to this legal matter entrusted to him. His failure to do so constitutes a violation of Rule 18.03 of the Code of Professional Responsibility. Once he agrees to take up the cause of a client, a lawyer owes fidelity to such cause and must always be mindful of the trust and confidence reposed in him. He must serve the client with competence and diligence and champion the latter's cause with wholehearted fidelity, care and devotion. Elsewise stated, he owes entire devotion to the interest of the client, warm zeal in the maintenance and defense of his client's rights, and the exertion of his utmost learning and ability to the end that nothing be taken or withheld from his client, save by the rules of law, legally applied. This simply means that his client is entitled to the benefit of any and every remedy and defense that is authorized by the law of the land and he may expect his lawyer to assert every such remedy or defense. If much is demanded from an attorney, it is because the entrusted privilege to practice law carries with it the correlative duties not only to the client but also to the court, to the bar and to the public. A lawyer who performs his duty with diligence and candor not only protects the interest of his client; he also serves the ends of justice, does honor to the bar and helps maintain the respect of the community to the legal profession.[16] If indeed Atty. Ortizs schedule, workload, or physical condition was such that he would not be able to make a

timely filing, he should have informed Canoy of such fact. The relationship of lawyer-client being one of confidence, there is ever present the need for the client to be adequately and fully informed of the developments of the case and should not be left in the dark as to the mode and manner in which his/her interests are being defended.[17] There could have been remedies undertaken to this inability of Atty. Ortiz to file on time the position paper had Canoy been told of such fact, such as a request for more time to file the position paper, or maybe even the hiring of collaborating counsel or substitution of Atty. Ortiz as counsel. Since Atty. Ortiz did not exercise the necessary degree of care by either filing the position paper on time or informing Canoy that the paper could not be submitted seasonably, the ignominy of having the complaint dismissed for failure to prosecute could not be avoided. That the case was dismissed without prejudice, thus allowing Canoy to refile the case, hardly serves to mitigate the liability of Atty. Ortiz, as the failure to file the position paper is per se a violation of Rule 18.03.[18] Neither is the Court mollified by the circumstance of Atty. Ortizs election as a City Councilor of Bacolod City, as his adoption of these additional duties does not exonerate him of his negligent behavior. The Code of Professional Responsibility does allow a lawyer to withdraw his legal services if the lawyer is elected or appointed to a public office. [19] Statutes expressly prohibit the occupant of particular public offices from engaging in the practice of law, such as governors and mayors,[20] and in such instance, the attorney-client relationship is terminated.[21] However, city councilors are allowed to practice their profession or engage in any occupation except during session hours, and in the case of lawyers such as Atty. Ortiz, subject to certain prohibitions which are not relevant to this case.[22] In such case, the lawyer nevertheless has the choice to withdraw his/her services.[23] Still, the severance of the relation of attorney-client is not effective until a notice of discharge by the client or a manifestation clearly indicating that purpose is filed with the court or tribunal, and a copy thereof served upon the adverse party, and until then, the lawyer continues to be counsel in the case.[24] Assuming that Atty. Ortiz was justified in terminating his services, he, however,

cannot just do so and leave complainant in the cold unprotected.[25] Indeed, Rule 22.02 requires that a lawyer who withdraws or is discharged shall, subject to a lien, immediately turn over all papers and property to which the client is entitled, and shall cooperate with his successor in the orderly transfer of the matter. Atty. Ortiz claims that the reason why he took no further action on the case was that he was informed that Canoy had acquired the services of another counsel. Assuming that were true, there was no apparent coordination between Atty. Ortiz and this new counsel. In fact, it took nearly two years before Canoy had learned that the position paper had not been filed and that the case had been dismissed. This was highly irresponsible of Atty. Ortiz, much more so considering that Canoy was one of the indigent clients whom Atty. Ortiz proudly claims as his favored clientele. It does not escape the Courts attention that Atty. Ortiz faults Canoy for not adequately following up the case with his office.[26] He cannot now shift the blame to complainant for failing to inquire about the status of the case, since, as stated above, it was his duty as lawyer to inform his clients of the status of cases entrusted to him.[27] The appropriate sanction is within the sound discretion of this Court. In cases of similar nature, the penalty imposed by the Court consisted of either a reprimand, a fine of five hundred pesos with warning, suspension of three months, six months, and even disbarment in aggravated cases.[28] Given the circumstances, the Court finds the penalty recommended by the IBP too lenient and instead suspends Atty. Ortiz from the practice of law for one (1) month. The graver penalty of suspension is warranted in lieu of an admonition or a reprimand considering that Atty. Ortizs undisputed negligence in failing to timely file the position paper was compounded by his failure to inform Canoy of such fact, and the successive dismissal of the complaint. Lawyers who devote their professional practice in representing litigants who could ill afford legal services deserve commendation. However, this mantle of public service will not deliver the lawyer, no matter how well-meaning, from the consequences of negligent acts. It is not enough to say that all pauper litigants should be assured of legal representation. They deserve quality representation as well.

WHEREFORE, respondent Atty. Jose Max S. Ortiz is ordered SUSPENDED from the practice of law for one (1) month from notice, with the warning that a repetition of the same negligence will be dealt with more severely. Let a copy of this decision be attached to respondent's personal record in the Office of the Bar Confidant and copies be furnished to all chapters of the Integrated Bar of the Philippines and to all the courts in the land. SO ORDERED. Puno, (Chairman), Austria-Martinez, Callejo, Sr., and Chico-Nazario, JJ., concur.

Parties thru counsel submitted following compromise agreement:

the

"1. That the parties agree that defendant is the LESSOR and owner of the premises subject of the herein complaint and that herein plaintiff is the LESSEE thereof who is to vacate the leased premises peacefully on November 7, 1995; 2. That in the possession of defendant are the following amounts: a) P20,000.00 deposited by plaintiff to defendant on June 7, 1994 for utilities; b) 5,400.00 as returnable association dues to plaintiff; c) 30,000.00 deposited by the plaintiff to defendant on August 30, 1994, for telephone [expenses]; d) 55,000.00 [rental] deposit [to be applied as rental payment] for the period of October 7 to November 7, 1995. 3. That likewise plaintiff paid for the 5% withholding taxes to the Bureau of Internal Revenue for the rentals which is due from the defendant amounting to P25,175.00 covering the period from July 1994, to July of 1995, whereon plaintiff is hereto attaching proof of payment or receipts as annexes "A" and "B" of said withholding taxes and had been credited to the defendant entitling plaintiff to full reimbursement; 4. That it is expressly agreed that prior to or on November 7, 1995, defendant will reimburse to plaintiff the withholding taxes paid to the Bureau of Internal Revenue in the name of defendant upon signing of the herein compromise agreement plus the association dues of P5,400.00 or a total of P30,575.00; 5. That with the P55,000.00 consumed by way of rentals up to November 7, 1995, there will be left in the possession of defendant of plaintiffs money in the amount

G.R. No. 150718 2003

March 26,

BASILIO BORJA, SR., petitioner, vs. SULYAP, INC. and THE COURT OF APPEALS, respondents. YNARES-SANTIAGO, J.: This is a petition for review assailing the April 20, 2001 Decision1 of the Court of Appeals in CA-G.R. CV No. 62237, and its October 31, 2001 Resolution2 denying petitioners motion for reconsideration. The antecedent facts reveal that petitioner Basilio Borja, Sr., as lessor, and private respondent Sulyap Inc., as lessee, entered into a contract of lease involving a one-storey office building owned by the petitioner and located at 12th Street, New Manila, Quezon City. Pursuant to the lease, private respondent paid, among others, advance rentals, association dues and deposit for electrical and telephone expenses. Upon the expiration of their lease contract, private respondent demanded the return of the said advance rentals, dues and deposit but the petitioner refused to do so. Thus, on October 5, 1995, the former filed with the Regional Trial Court of Quezon City, Branch 80, a complaint for sum of money against the petitioner.3 Subsequently, the parties entered into and submitted to the trial court a "Compromise Agreement" dated October 16, 1995.4 On the basis thereof, the trial court, on October 24, 1995 rendered a decision5 approving the compromise agreement. The full text of the said decision reads:

of P50,000.00; said amount shall be turned over by defendant to plaintiff within 5 days from arrival of billings for telephone, electrical and water charges only; 6. That the amount shall be subject to actual billings ending November 7, 1995 only and shall immediately as stated, be hand[ed] over to plaintiff; 7. That it is expressly agreed that the parties shall comply in good faith to the terms of the herein compromise agreement and that any amount due not paid within the period stated in this agreement shall earn 2% interest per month until fully paid plus twenty five 25% attorneys fees of the amount collectible and that writ of execution shall be issued as a matter of right. (Emphasis supplied) WHEREFORE, in light of the above, it is respectfully prayed of this Honorable Court that judgment be rendered on the basis of the above compromise agreement. Manila for Quezon City October 16, 1995." Finding the foregoing compromise agreement to be not contrary to law, morals and public policy, the same is hereby APPROVED. WHEREFORE, judgment is hereby rendered in accordance with the terms and conditions set forth in the compromise agreement and the parties are hereby enjoined to comply with and abide by the said terms and conditions thereof. SO ORDERED.6 Petitioner, however, failed to pay the amounts of P30,575.00 and P50,000.00 stated in the judicial compromise. Hence, private respondent filed a motion for the issuance of a writ of execution for the total amounts of P30,575.00 and P50,000.00 or a total of P102,733.12, inclusive of 2% interest and 25% attorneys fees.7 The trial court, in its February 7, 1996 order,8 granted the motion over the opposition9 of the petitioner. On May 24, 1996, the latter

filed a motion to quash the writ of execution, contending that the penalty of 2% monthly interest and 25% attorneys fees should not be imposed on him because his failure to pay the amounts of P30,575.00 and P50,000.00 within the agreed period was due to private respondents fault.10 On February 20, 1997, petitioner filed another motion praying for the quashal of the writ of execution and modification of the decision.11 This time, he contended that there was fraud in the execution of the compromise agreement. He claimed that 3 sets of compromise agreement were submitted for his approval. Among them, he allegedly chose and signed the compromise agreement which contained no stipulation as to the payment of 2% monthly interest and 25% attorneys fees in case of default in payment. He alleged that his former counsel, Atty. Leonardo Cruz, who assisted him in entering into the said agreement, removed the page of the genuine compromise agreement where he affixed his signature and fraudulently attached the same to the compromise agreement submitted to the court in order to make it appear that he agreed to the penalty clause embodied therein. Private respondent, on the other hand, vehemently denied the contention of the petitioner. To refute the latters claim, he presented Atty. Leonardo Cruz, who declared that the petitioner gave his consent to the inclusion of the penalty clause of 2% monthly interest and 25% attorneys fees in the compromise agreement. He added that the compromise agreement approved by the court was in fact signed by the petitioner inside the courtroom before the same was submitted for approval. Atty. Cruz stressed that the penalty clause of 2% interest per month until full payment of the amount due, plus 25% thereof as attorneys fees, in case of default in payment, was actually chosen by the petitioner over another proposed more burdensome penalty clause which states "That it is expressly agreed that the parties shall comply in good faith to the terms of the herein compromise agreement and that any violation thereof shall automatically entitle the aggrieved party to damages in the amount of P250,000.00 plus P50,000.00 attorneys fees."12

On October 26, 1998, the trial court issued the assailed order denying petitioners motion seeking to quash the writ of execution and to modify the judgment on compromise. It gave credence to the testimony of Atty. Leonardo Cruz that petitioner consented to the penalty clause in the compromise agreement. The court further noted that it was only on February 20, 1997, or more than one year from receipt of the judgment on compromise on October 25, 1995, when he questioned the inclusion of the penalty clause in the approved compromise agreement despite several opportunities to raise said objection. The dispositive portion of the said order states: WHEREFORE, premises considered, and as earlier stated, the defendants motion to quash the writ of execution and modification of judgment is denied. SO ORDERED.13 On appeal by the petitioner to the Court of Appeals, the latter affirmed the challenged order of the trial court. Hence, the instant petition. Is the petitioner bound by the penalty clause in the compromise agreement? The settled rule in criminal as well as in civil cases is that, in the matter of credibility of witnesses, the findings of the trial courts are given great weight and highest degree of respect by the appellate court considering that the latter is in a better position to decide the question, having heard the witnesses themselves and observed their deportment and manner of testifying during the trial, unless it plainly overlooked certain facts of substance and value that, if considered, might affect the result of the case. In the case at bar, we are faced with the conflicting claim of the petitioner that the questioned penalty clause was fraudulently added to the compromise agreement approved by the court, and the assertion of private respondent that the petitioner consented to the inclusion thereof in the compromise agreement. A scrutiny of the records reveal that the trial court correctly sustained the claim of private respondent. While a judicial compromise may be annulled or modified

on the ground of vitiated consent or forgery,14 we find that the testimony of the petitioner failed to establish the attendance of fraud in the instant case. Indeed, the testimony of Atty. Leonardo Cruz is worthy of belief and credence. We are inclined to believe that the petitioner had knowledge of and consented to the penalty clause embodied in the agreement considering that the same is less burdensome than the automatic imposition of the penalty of P250,000.00 and attorneys fees of P50,000.00 in case of violation of the terms of the agreement or default in payment. Moreover, we see nothing irregular in the compromise agreement approved by the trial court. No evidence was presented by petitioner other than his bare allegation that his former counsel fraudulently attached the page of the genuine compromise agreement where he affixed his signature to the compromise agreement submitted to the court. What further militates against the claim of the petitioner is his conduct after receiving the judgment based on the compromise agreement. From October 25, 1995, when he received the judgment reproducing the full text of the compromise agreement, to February 19, 1997, he never raised the issue of the fraudulent inclusion of the penalty clause in their agreement. We note that petitioner is a doctor of medicine. He must have read and understood the contents of the judgment on compromise. In fact, on November 13, 1995, he filed, without the assistance of counsel, a motion praying that the amounts of P50,000.00 and 37,575.00 be withheld from his total obligation and instead be applied to the expenses for the repair of the leased premises which was allegedly vandalized by the private respondent.15 He did not question the penalty clause in the compromise agreement. Even when the petitioner was already represented by his new counsel, Atty. Felixberto F. Abad, to whom he allegedly confided his former counsels fraudulent inclusion of the penalty clause, the issue of fraud was never brought to the trial courts attention. On January 31, 1996, when petitioner filed an opposition to the private respondents motion for the issuance of a writ of execution, he likewise failed to mention the fraud complained of. On May 24, 1996, petitioner filed a motion to quash the writ of execution but based on a different ground. He argued that the

penalty of 2% monthly interest and 25% attorneys fees cannot be imposed on him considering that his failure to pay on time was due to the fault of the private respondent. He allegedly refused to pay because the person sent by private respondent to collect payment did not present a special power of attorney authorizing him to receive said payment.16 In effect, therefore, petitioner acknowledged the validity of the penalty clause. Evidently, petitioner cannot feign ignorance of the existence of the penalty clause in the compromise agreement approved by the court. Even assuming that Atty. Leonardo Cruz exceeded his authority in inserting the penalty clause, the status of the said clause is not void but merely voidable, i.e., capable of being ratified.17 Indeed, petitioners failure to question the inclusion of the 2% monthly interest and 25% attorneys fees in the judicial compromise despite several opportunities to do so was tantamount to ratification. Hence, he is estopped from assailing the validity thereof.18 Finally, we find no merit in petitioners contention that the compromise agreement should be annulled because Atty. Leonardo Cruz, who assisted him in entering into such agreement, was then an employee of the Quezon City government, and is thus prohibited from engaging in the private practice of his profession. Suffice it to state that the isolated assistance provided by Atty. Cruz to the petitioner in entering into a compromise agreement does not constitute a prohibited "private practice" of law by a public official. "Private practice" of a profession, specifically the law profession does not pertain to an isolated court appearance; rather, it contemplates a succession of acts of the same nature habitually or customarily holding ones self to the public as a lawyer.19 Such was never established in the instant case. WHEREFORE, in view of all the foregoing, the instant petition is DENIED. The Decision of the Court of Appeals in CAG.R. CV No. 62237, which sustained the trial courts denial of petitioners motion to quash the writ of execution and to modify the compromise judgment, is AFFIRMED. SO ORDERED.

Davide, Jr., C.J., (Chairman), Vitug, Carpio and Azcuna, JJ., concur.