FIRST DIVISION
[A.C. No. 4943. January 26, 2001]
DIANA D. DE GUZMAN, complainant, vs. ATTY. LOURDES I. DE DIOS, respondent.
R E SO L U T I O N
PARDO, J.:
The case before the Court is a
complaint[1] for disbarment against Atty. Lourdes I. De Dios on the ground of
violation of Canon 15, Rule 15.03 of the code of Professional Responsibility,
for representing conflicting interests, and of Article 1491 Civil Code, for
acquiring property in litigation.
In 1995, complainant engaged the
services of respondent as counsel in order to form a corporation, which would
engage in hotel and restaurant business in Olongapo City.
On January 10, 1996, with the
assistance of Atty. De Dios, complainant registered Suzuki Beach Hotel, Inc.
(SBHI) with the Securities and Exchange Commission.[2] Complainant paid on respondent a monthly retainer
fee of P5,000.00.
On December 15, 1997, the
corporation required complainant to pay her unpaid subscribed shares of stock
amounting to two million two hundred and thirty five thousand pesos
(P2,235,000.00) or 22,350 shares, on or before December 30, 1997.
On January 29, 1998,[3] complainant received notice
of the public auction sale of her delinquent shares and a copy of a board
resolution dated January 6, 1998 authorizing such sale.[4] Complainant soon learned
that her shares had been acquired by Ramon del Rosario, one of the
incorporators of SBHI. The sale ousted
complainant from the corporation completely.
While respondent rose to be president of the corporation, complainant
lost all her life’s savings invested therein.
Complainant alleged that she
relied on the advice of Atty. De Dios and believed that as the majority
stockholder, Atty. de Dios would help her with the management of the
corporation.
Complainant pointed out that
respondent appeared as her counsel and signed pleadings in a case where
complainant was one of the parties.[5] Respondent, however, explained that she only
appeared because the property involved belonged to SBHI. Respondent alleged that complainant
misunderstood the role of respondent as legal counsel of Suzuki Beach Hotel,
Inc. Respondent manifested that her appearance as counsel for complainant Diana
de Guzman was to protect the rights and interest of SBHI since the latter was
real owner of the land in controversy.
Respondent further said that the
land on which the resort was established belonged to the Japanese
incorporators, not to complainant. The
relationship of the complainant and the Japanese investors turned sour because
complainant misappropriated the funds and property of the corporation. To save the corporation from bankruptcy,
respondent advised all concerned stockholders that it was proper to call for
the payment of unpaid subscriptions and subsequent sale of the delinquent
shares. These lead to the auction of
the unpaid shares of complainant and hence, the ouster of complainant from the
corporation.
Meantime, Mr. Del Rosario
transferred one hundred (100) shares to respondent in payment of legal services
as evidenced by a Deed of Waiver and Transfer of corporate Shares of Stock.
On October 22, 1999, the
Integrated Bar of the Philippines issued a resolution[6] finding that the acts of respondent were not motivated by ill will as
she acts in the best interest of her client, SBHI. The IBP found that complainant failed to present convincing proof
of her attorney-client relationship with respondent other than the pleadings
respondent filed in the trial court where complainant was one of the parties.
We disagree.
We find merit in the
complaint. There are certain facts
presented before us that created doubt on the propriety of the declaration of
delinquent shares and subsequent sale of complainant’s entire
subscription. Complainant subscribed to
29,800 shares equivalent to two million nine hundred and eighty thousand pesos
(P2,980,000.00). She was the majority
stockholder. Out of the subscribed
shares, she paid up seven hundred forty-five thousand pesos (P745,000.00)
during the stage of incorporation.
How complainant got ousted from
the corporation considering the amount she had invested in it is beyond
us. Granting that the sale of her
delinquent shares was valid, what happened to her original shares? This, at least, should have been explained.
Respondent claims that there was
no attorney-client relationship between her and complainant. The claim has no merit. It was complainant who retained respondent
to form a corporation. She appeared as
counsel in behalf of complainant.
There was evidence of collusion
between the board of directors and respondent.
Indeed, the board of directors nowe included respondent as the
president, Ramon del Rosario as secretary, Hikoi Suzuki as chairman, Agnes
Rodriguez as treasurer and Takayuki Sato as director.[7] The present situation shows a clear case of conflict
of interest of the respondent.
Lawyers must conduct themselves,
especially in their dealings with their clients and the public at large, with
honesty and integrity in a manner beyond reproach.[8]
We said:
“To say that lawyers must at all times uphold and respect the law
is to state the obvious, but such statement can never be overemphasized. Considering that, ‘of all classes and
professions, [lawyers are] most sacredly bound to uphold the law,’ it is
imperative that they live by the law.
Accordingly, lawyers who violate their oath and engage in deceitful
conduct have no place in the legal profession.”[9]
Clearly, respondent violated the
prohibition against representing conflicting interests and engaging in
unlawful, dishonest, immoral or deceitful conduct.[10]
As a lawyer, respondent is bound
by her oath to do no falsehood or consent to its commission and to conduct
herself as a lawyer according to the best of her knowledge and discretion. The lawyer’s oath is a source of obligations
and violation thereof is a ground for suspension, disbarment,[11] or other disciplinary
action.[12] The acts of respondent
Atty. De Dios are clearly in violation of her solemn oath as a lawyer that this
Court will not tolerate.
WHEREFORE, the Court finds respondent Atty. Lourdes I. De Dios
remiss in her sworn duty to her client, and to the bar. The Court hereby SUSPENDS her from the
practice of law for six (6) months, with warning that a repetition of the
charges will be dealth with more severely.
Let a copy ofthis decision be
entered in the personal records of respondent as an attorney and as a member of
the Bar, and furnish the Bar Confidant, the Integrated Bar of the Philippines,
and the Court Administrator for circulation to all courts in the country.
SO ORDERED.
Davide, Jr., C.J. (Chairman), Puno, Kapunan, and Ynares-Santiago, JJ., concur.
[1] Filed
on September 4, 1998.
[2] SEC
Registration No. AS096-000265, Rollo, p. 4-28.
[3] Letter
dated January 20, 1998, Rollo, p. 38.
[4] Rollo,
p. 37.
[5] Entry
of Appearance, Rollo, p. 74.
[6] Rollo,
pp. 119-125.
[7] Rollo,
p. 46.
[8] Resurreccion
v. Sayson, 300 SCRA 129 [1998].
[9] Ibid.,
citing Ex parte Wall, 107 U.S. 265, cited in Malcolm, Legal and Judicial
Ethics, p. 214.
[10] Code
of Professional Responsibility, Canon 1, Rule 1.01.
[11] Magdaluyo
v. Nace, A.C. 3808, February 2, 2000, citing Adez Realty, Inc. v.
CA, 215 SCRA 301 (1992); Richards v. Asoy, 152 SCRA 45, 50 (1987); Diaz v.
Gerong, 141 SCRA 46, 49 (1986).
[12] Magdaluyo
v. Nace, A.C., supra, Note 11, citing Reyes v. Gaa, 246 SCRA 64,
67 (1995).