Legal Ethics

LOTHAR SCHULZ vs. ATTY. MARCELO G. FLORES A.C. No. 4219. December 8, 2003 Legal Ethics

 

FACTS:

Lothar Schulz, a German national filed a verified complaint for disbarment against Atty. Marcelo G. Flores.  He alleged that he engaged the services of respondent for the purposes of filing a complaint against Wilson Ong for revocation of contract and damages for the latter’s failure to deliver the jeep he sold to complainant within the stipulated period.  Respondent advised him that there was no need to refer the complaint for barangay conciliation.  Three months later, respondent instructed him to file his complaint with the Lupon Tagapayapa of Tabuc-tubig, Dumaguete City.  Wilson Ong refused to appear at the conciliation hearings, arguing that the Lupon of Tabuc-tubig had no jurisdiction over his person because he was a resident of Barangay Banilad.  Complainant thus brought the complaint before the Barangay Captain of Banilad.  By that time, however, complainant learned that Wilson Ong had already filed a case for Specific Performance against him before the RTC.  Complainant argued that respondent’s inordinate delay in acting on his case resulted in his being defendant rather than a complainant against Wilson Ong.

Complainant also charged respondent with collecting excessive and unreasonable fees and of unjustifiably refusing to return his files.  He undertook to pay respondent attorney’s fees of P5,000.00 if the case does not reach the court, and P10,000.00 attorney’s fees and P500.00 appearance fees if it reaches the court.  This notwithstanding, respondent alleged in the Answer with Counterclaim which he prepared on behalf of complainant that his attorney’s fees was P50,000.00 and appearance fee was P1,000.00 per hearing.  When complainant questioned him about this, respondent explained that it was Wilson Ong who will be made to pay for the said fees.  This, complainant claimed, showed respondent’s deceit and lack of candor in his dealings with his parties in court.

Further, complainant alleged that since he suspected respondent of not protecting his interest. He instructed respondent to withdraw his appearance as his counsel after the filing of the answer.  Thereafter, he asked respondent to return the amount of P12,000.00 out of the total of P17,000.00 that he has paid to the latter, inasmuch as the amount of P5,000.00 should be sufficient compensation for the minimal services rendered by him.  Respondent, however, refused to return the amount to complainant and, instead, demanded additional fees.  Complainant’s new counsel wrote a formal demand letter to respondent which, however, was ignored.  This prompted complainant to file a complaint with the Lupon Tagapayapa of Barangay Bantayan where respondent resided.  After the parties failed to reach a settlement, complainant instituted an action for sum of money against respondent.

ISSUE:

Was there failure on respondent’s duty to his client?

RULING:

Respondent was presumed to be knowledgeable on the laws, but in this case, it turned out that Atty. Flores knew too little of the provisions and application of PD No. 1508 which mandates that all disputes, except those specifically cited (the dispute between Lothar Schulz and Wilson Ong not included), between and among residents of the same city or municipality should be brought first under the system of barangay conciliation. He was not all certain if the complaint of Lothar Schulz falls under PD No. 1508 or not.  As Lothar Schulz narrated, Atty. Flores told him at first that there was no need for his complaint to be coursed through the barangay authorities.

Furthermore, Respondent has fallen short of the competence and diligence required of every member of the Bar. The pertinent Canons of the Code of Professional Responsibility state:

CANON 17. – A LAWYER OWES FIDELITY TO THE CAUSE OF HIS CLIENT AND HE SHALL BE MINDFUL OF THE TRUST AND CONFIDENCE REPOSED IN HIM.

CANON 18. – A LAWYER SHALL SERVE HIS CLIENT WITH COMPETENCE AND DILIGENCE

 

Likewise, respondent erred in not returning complainant’s money despite demands after his failure to file the case and his devious act of compelling complainant to sign a document stating that he has no financial obligation to complainant in exchange of the return of complainant’s papers.  This conduct violated the following Canon:

CANON 15. – A LAWYER SHALL OBSERVE CANDOR, FAIRNESS, AND LOYALTY IN ALL HIS DEALINGS AND TRANSACTIONS WITH HIS CLIENT.

Rule 16.03. – A lawyer shall deliver the funds and property of client when due or upon demand.

 

WHEREFORE, in view of all the foregoing, respondent Atty. MARCELO G. FLORES is found guilty of negligence and incompetence, and is SUSPENDED from the practice of law for a period of six (6) months effective immediately.  He is ordered to RETURN to complainant Lothar Schulz the amount of Twelve Thousand Pesos (P12,000.00) with legal interest from the date of promulgation of this Resolution, and all papers which came into his custody as a result of having served as counsel for said complainant.  Respondent is further STERNLY WARNED that a commission of the same or similar act in the future will be dealt with more severely.

 

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