De Borja vs. Mendez, Jr.

A lawyer who fails to file a client's appellant's brief within the reglementary period despite notice, resulting in dismissal of the appeal, commits inexcusable negligence in violation of Canon 18 of the Code of Professional Responsibility; and a lawyer who receives money from a client for a specific purpose but fails to use it for that purpose or return it upon demand violates Canon 16, warranting suspension from the practice of law and an order to return the unaccounted balance.

Complainant Jaime S. De Borja, as representative of the Heirs of Deceased Augusto De Borja, engaged the services of R.R. Mendez & Associates Law Offices, where respondent Atty. Ramon R. Mendez, Jr. is a lawyer, for the reconveyance of a parcel of land. The attorney-client relationship was governed by the Code of Professional Responsibility, which mandates lawyers to serve their clients with competence and diligence (Canon 18) and to hold in trust all moneys and properties of clients that come into their possession (Canon 16). The case arose from the lawyer's handling of an appeal before the Court of Appeals and his receipt of P300,000.00 from the client for the titling of a property in Pateros.

Sometime in 2004, Jaime S. De Borja, as representative of the Heirs of Deceased Augusto De Borja, engaged the services of R.R. Mendez & Associates Law Offices, where Atty. Ramon R. Mendez, Jr. is a lawyer, for the reconveyance of a parcel of land. Along with the prosecution of the case, Atty. Mendez demanded Three Hundred Thousand Pesos (P300,000.00) for the titling of a property situated in Pateros. Jaime submitted a copy of the receipt of said amount of money which was acknowledged by Atty. Mendez.

The complaint for reconveyance was dismissed, and Atty. Mendez filed a notice of appeal. On October 20, 2011, the Court of Appeals ordered the Heirs of De Borja to file their Appellant's Brief within forty-five (45) days from receipt of the notice. When Jaime received the notice on October 27, 2011, he inquired with Atty. Mendez about the letter, to which Atty. Mendez committed that he will file the Appellant's Brief as soon as he receives a copy of the notice.

On February 3, 2012, Jaime was surprised to receive a Resolution dated January 27, 2012 from the Court of Appeals dismissing the appealed case for failure to file Appellant's Brief. He asked Atty. Mendez the reason why they weren't able to file the required pleading, and he was told that the firm did not receive a copy of the notice which ordered them to file the appellant's brief. Atty. Mendez assured him that he will file the motion for reconsideration based on non-receipt of the notice, and will subsequently file the appellant's brief.

Unsatisfied, Jaime went to the Court of Appeals and the Postal Office of Caloocan. He discovered that the notice to file appellant's brief was in fact received by one Jennifer Lastimosa, a secretary of the firm R.R. Mendez & Associates Law Offices. Jaime presented a copy of the Certification issued by the Caloocan Central Post Office showing that Lastimosa received on October 28, 2011 the notice from the Court of Appeals.

Disappointed, in a Letter dated February 13, 2012, citing loss of trust and confidence due to the dismissal of their appeal, Jaime terminated the services of Atty. Mendez, and demanded the return of the Three Hundred Thousand (Php300,000.00). Unable to get a reply from Atty. Mendez even after six months, on August 2, 2012, Jaime wrote anew to Atty. Mendez and demanded the return of the money. Thus, the instant administrative complaint against Atty. Mendez for incompetence and malpractice.

In his Answer, Atty. Mendez insisted that his law office did not receive a copy of the court order to file the appellant's brief. He claimed that even their secretary, Jennifer Lastimosa, cannot recall having received said order or mail. He claimed that when Jaime informed him about the dismissal order, he lost no time in preparing the motion for reconsideration and the appellant's brief. He lamented, however, that before the drafted motion for reconsideration and appellant's brief could be filed in court, Jaime already terminated his services as counsel. Atty. Mendez maintained that he has been in the practice of law for more than three (3) decades already and that he was never remiss in his duty to his clients. He claimed that it was unfortunate that his secretary's signature was forged to make it appear that she has received the mail.

Atty. Mendez, however, acknowledged the receipt of 300,000.00 as retainer's fees from Jaime. He averred that considering that he had actually rendered professional services to Jaime, he may refund reasonable portion thereof. Finally, Atty. Mendez asserted that due to the fact that his office actually failed to receive the notice from the court, there is no basis to show that he was unprofessional, thus, does not deserve to be meted any harsh punishment from the Court.

After more than one (1) year, or on June 26, 2013, Atty. Mendez made partial return of Jaime's money in the amount of P140,000.00 which was received by Atty. Marie Diane Bolong, Jaime's new counsel. Atty. Mendez, in his Position Paper, claimed that he does not know how he can return the remaining balance as he already spent it for the titling of the property and that he also used the money for his daily needs considering that said money was also his retainer's fee.

• Negligence in Handling Appeal: Complainant alleged that Atty. Mendez was guilty of incompetence and malpractice for failing to file the appellant's brief despite notice, which resulted in the dismissal of the appeal before the Court of Appeals.
• Non-Receipt of Notice Refuted: Complainant presented a Certification from the Caloocan Central Post Office showing that the notice from the Court of Appeals was received by Jennifer Lastimosa, the firm's secretary, on October 28, 2011, contradicting Atty. Mendez's claim of non-receipt.
• Failure to Return Client Funds: Complainant demanded the return of the P300,000.00 given for the titling of the property, first through a letter dated February 13, 2012 terminating Atty. Mendez's services, and again through a letter dated August 2, 2012, but received no reply from Atty. Mendez.

• Non-Receipt of Notice: Atty. Mendez insisted that his law office did not receive a copy of the court order to file the appellant's brief, and that even their secretary, Jennifer Lastimosa, cannot recall having received said order or mail.
• Forgery of Secretary's Signature: Atty. Mendez claimed that it was unfortunate that his secretary's signature was forged to make it appear that she received the mail.
• Prompt Preparation of Pleadings: Atty. Mendez claimed that when Jaime informed him about the dismissal order, he lost no time in preparing the motion for reconsideration and the appellant's brief, but Jaime terminated his services before these could be filed.
• Long Practice of Law: Atty. Mendez maintained that he has been in the practice of law for more than three decades and was never remiss in his duty to his clients.
• Retainer's Fees: Atty. Mendez acknowledged receipt of P300,000.00 as retainer's fees and averred that since he had actually rendered professional services, he may refund only a reasonable portion thereof.
• Inability to Return Full Amount: Atty. Mendez claimed he does not know how he can return the remaining balance as he already spent it for the titling of the property and for his daily needs, considering that the money was also his retainer's fee.

• Negligence in Filing Appellant's Brief: Whether Atty. Mendez is guilty of negligence for failing to file the appellant's brief within the reglementary period, resulting in the dismissal of the appeal.
• Credibility of Non-Receipt Defense: Whether Atty. Mendez's claim of non-receipt of the notice to file the appellant's brief can overcome the postal certification showing receipt by his office secretary.
• Violation of Fiduciary Duty Over Client Funds: Whether Atty. Mendez violated Canon 16 of the Code of Professional Responsibility for failing to account for and return the P300,000.00 received from the client for the titling of property.
• Sufficiency of Penalty: Whether the six-month suspension recommended by the IBP is sufficient punishment for Atty. Mendez's transgressions.

• Negligence in Filing Appellant's Brief: Yes. Atty. Mendez's failure to file the appellant's brief within the reglementary period despite notice constitutes inexcusable negligence, more so because the failure resulted in the dismissal of the appeal, in violation of Rule 18.03, Canon 18 of the Code of Professional Responsibility.
• Credibility of Non-Receipt Defense: No. The bare allegation of non-receipt of notice cannot prevail over the registry return card, the postmaster's record books, and the certification issued by the Caloocan Central Post Office showing receipt of the notice by the firm's secretary, Jennifer Lastimosa.
• Violation of Fiduciary Duty Over Client Funds: Yes. Atty. Mendez violated Rules 16.01 and 16.03 of Canon 16 of the Code of Professional Responsibility for failing to account for the P300,000.00 received from the client and for failing to return the money upon demand, having only made a partial return of P140,000.00 after more than a year.
• Sufficiency of Penalty: No. The six-month suspension recommended by the IBP-CBD and adopted by the Board of Governors is not sufficient punishment; the Court imposed a one-year suspension considering the totality of circumstances and jurisprudence.

• Negligence in Filing Appellant's Brief: Canon 18 of the Code of Professional Responsibility states that "A lawyer shall serve his client with competence and diligence." Rule 18.03 thereof stresses that a lawyer shall not neglect a legal matter entrusted to him, and his negligence in connection therewith shall render him liable. The Court found Atty. Mendez's guilt as to his failure to do his duty to his client undisputed. His conduct relative to the non-filing of the appellant's brief falls below the standards exacted upon lawyers on dedication and commitment to their client's cause. An attorney is bound to protect his clients' interest to the best of his ability and with utmost diligence. Failure to file the brief within the reglementary period despite notice certainly constitutes inexcusable negligence, more so if the failure resulted in the dismissal of the appeal, as in this case.

• Credibility of Non-Receipt Defense: The Court gave no credence to Atty. Mendez's "lame excuse" that they did not receive the notice to file the appellant's brief, or that their secretary cannot recall receiving the notice. Such bare allegation of non-receipt of notice as against the registry return card, the postmaster's record books and the certification issued by the Caloocan Central Post Office showing receipt of the notice by Jennifer Lastimosa, the firm's secretary, the latter deserves more weight. Likewise, in the absence of proof to support Atty. Mendez's claim of forgery insofar as Jennifer's signature showing receipt of notice, such claim cannot be sustained. The Court observed that making the law office secretary, clerk or messenger the scapegoat or patsy for the delay in the filing of pleadings, motions and other papers and for the lawyer's dereliction of duty is a common alibi of practicing lawyers. Like the alibi of the accused in criminal cases, counsel's shifting of the blame to his office employee is usually a concoction utilized to cover up his own negligence, incompetence, indolence and ineptitude. Other than Atty. Mendez's allegation of non-receipt of the notice, he failed to duly present any reasonable excuse for the non-filing of the appellant's brief despite notice, thus, the allegation of negligence on his part in filing the appellant's brief remains uncontroverted. As a lawyer, it is expected of him to make certain that the appeal brief was filed on time.

• Violation of Fiduciary Duty Over Client Funds: The Court found Atty. Mendez guilty of violating Rule 16.01 of the Code of Professional Responsibility which requires a lawyer to account for all the money received from the client. In line with the highly fiduciary nature of an attorney-client relationship, Canon 16 of the Code requires a lawyer to hold in trust all moneys and properties of his client that may come into his possession. Rule 16.03 of the Code obligates a lawyer to deliver the client's funds and property when due or upon demand. Where a client gives money to his lawyer for a specific purpose, such as to file an action, to appeal an adverse judgment, to consummate a settlement, or to pay a purchase price for a parcel of land, the lawyer, upon failure to spend the money entrusted to him for the purpose, must immediately return the said money entrusted by the client. The Court quoted Del Mundo vs. Atty. Capistrano: "Moreover, a lawyer is obliged to hold in trust money of his client that may come to his possession. As trustee of such funds, he is bound to keep them separate and apart from his own. Money entrusted to a lawyer for a specific purpose such as for the filing and processing of a case if not utilized, must be returned immediately upon demand. Failure to return gives rise to a presumption that he has misappropriated it in violation of the trust reposed on him. And the conversion of funds entrusted to him constitutes gross violation of professional ethics and betrayal of public confidence in the legal profession." In the present case, Atty. Mendez received money from Jaime for the titling of property covered by Tax Declaration No. D-006-01404 on August 30, 2009. However, despite several oral and written demands to Atty. Mendez as evidenced by demand letters dated February 13, 2012 and August 2, 2012, the same fell on deaf ears. Not only did Atty. Mendez fail to use the money for its intended purpose, and return the money after demand, he also did not give Jaime any reply regarding the latter's demands. The Court noted that considering it took more than a year before Atty. Mendez made an initiative to return the money albeit partial only, the same cannot be said to be prompt or immediate return of the money, rather, he was already in delay for a considerable period of time in returning his client's money. Notably, Atty. Mendez not only failed to return the money immediately, but he also failed to return the whole amount of P300,000.00. He was able to return the amount of P140,000.00 only, thus, there is still a remaining balance of P160,000.00. While Atty. Mendez insisted that the remaining balance was used for the titling of the property and his daily needs, there was still no proper accounting as to when, where and how the remaining balance was specifically utilized. Clearly, these acts constitute violations of Atty. Mendez's professional obligations under Canon 16 of the CPR which mandates lawyers to hold in trust and account all moneys and properties of his client that may come into his possession.

• Sufficiency of Penalty: The Court found that the suspension for six (6) months recommended by the IBP-CBD which was adopted by the Board of Governors is not sufficient punishment for Atty. Mendez's transgressions. His failure to discharge his duty properly constitutes an infringement of ethical standards and of his oath. Such failure makes him answerable not just to his client, but also to this Court, to the legal profession, and to the general public. The Court compared jurisprudence: in Jinon vs. Atty. Jiz, the lawyer failed to facilitate the transfer of land to his client's name and failed to return the money he received from the client despite demand, and was suspended for two years; in Agot vs. Atty. Rivera, the lawyer neglected his obligation to secure his client's visa and failed to return his client's money despite demand, and was suspended for two years; in Luna vs. Atty. Galarrita, the lawyer failed to promptly inform his client of his receipt of the proceeds of a settlement for the client, and further refused to turn over the amount received, and was suspended for two years. The Court also sustained the IBP's recommendation ordering respondent to return the amount of P160,000.00 he received from complainant for the titling of their property. The Court clarified that while disciplinary proceedings should only revolve around the determination of the respondent-lawyer's administrative and not his civil liability, this rule remains applicable only to claimed liabilities which are purely civil in nature — for instance, when the claim involves moneys received by the lawyer from his client in a transaction separate and distinct and not intrinsically linked to his professional engagement. Here, since Atty. Mendez received the aforesaid amount as part of his legal fees as he claimed, the Court found it necessary, under the given circumstances, that he return the unaccounted remaining balance of P160,000.00 to Jaime.

• Inexcusable Negligence of Counsel — A lawyer's failure to file a pleading within the reglementary period despite notice constitutes inexcusable negligence, especially when such failure results in the dismissal of the client's appeal. The Court applied this doctrine to find Atty. Mendez liable under Rule 18.03, Canon 18 of the Code of Professional Responsibility, holding that an attorney is bound to protect his clients' interest to the best of his ability and with utmost diligence.

• Scapegoat Defense — Making the law office secretary, clerk or messenger the scapegoat or patsy for the delay in the filing of pleadings, motions and other papers and for the lawyer's dereliction of duty is a common alibi of practicing lawyers. Like the alibi of the accused in criminal cases, counsel's shifting of the blame to his office employee is usually a concoction utilized to cover up his own negligence, incompetence, indolence and ineptitude. The Court applied this doctrine to reject Atty. Mendez's claim of non-receipt of notice, especially given the postal certification showing receipt by his secretary.

• Fiduciary Duty Over Client Funds — A lawyer is obliged to hold in trust money of his client that may come to his possession. As trustee of such funds, he is bound to keep them separate and apart from his own. Money entrusted to a lawyer for a specific purpose such as for the filing and processing of a case if not utilized, must be returned immediately upon demand. Failure to return gives rise to a presumption that he has misappropriated it in violation of the trust reposed on him. The conversion of funds entrusted to him constitutes gross violation of professional ethics and betrayal of public confidence in the legal profession. The Court applied this doctrine to find Atty. Mendez guilty of violating Rules 16.01 and 16.03 of Canon 16.

• Administrative vs. Civil Liability in Disciplinary Proceedings — Disciplinary proceedings should only revolve around the determination of the respondent-lawyer's administrative and not his civil liability. However, this rule remains applicable only to claimed liabilities which are purely civil in nature — for instance, when the claim involves moneys received by the lawyer from his client in a transaction separate and distinct and not intrinsically linked to his professional engagement. The Court applied this doctrine to order the return of P160,000.00, since Atty. Mendez received the amount as part of his legal fees, making it intrinsically linked to his professional engagement.

• "An attorney is bound to protect his clients' interest to the best of his ability and with utmost diligence. Failure to file the brief within the reglementary period despite notice certainly constitutes inexcusable negligence, more so if the failure resulted in the dismissal of the appeal, as in this case." — This passage articulates the standard of diligence required of lawyers and establishes that failure to file a brief despite notice constitutes inexcusable negligence, forming the core of the Court's finding under Canon 18.

• "Making the law office secretary, clerk or messenger the scapegoat or patsy for the delay in the filing of pleadings, motions and other papers and for the lawyer's dereliction of duty is common alibi of practicing lawyers. Like the alibi of the accused in criminal cases, counsel's shifting of the blame to his office employee is usually a concoction utilized to cover up his own negligence, incompetence, indolence and ineptitude." — This passage rejects the common defense of blaming office staff for a lawyer's failure to file pleadings, and was used by the Court to dismiss Atty. Mendez's non-receipt defense.

• "Money entrusted to a lawyer for a specific purpose such as for the filing and processing of a case if not utilized, must be returned immediately upon demand. Failure to return gives rise to a presumption that he has misappropriated it in violation of the trust reposed on him. And the conversion of funds entrusted to him constitutes gross violation of professional ethics and betrayal of public confidence in the legal profession." — Quoted from Del Mundo v. Atty. Capistrano, this passage defines the fiduciary duty of lawyers over client funds and the consequences of failing to return money upon demand, forming the basis of the Canon 16 violation.

• Del Mundo vs. Atty. Capistrano, 685 Phil. 687, 693 (2012) — Cited as instructive authority on the lawyer's obligation to hold in trust client money and to return it immediately upon demand if not utilized for its intended purpose; failure to return gives rise to a presumption of misappropriation.

• Jinon vs. Atty. Jiz, 705 Phil. 321 (2013) — Cited as a comparable case where a lawyer who failed to facilitate the transfer of land to his client's name and failed to return money received despite demand was suspended for two years; used to support the increased penalty.

• Agot vs. Atty. Rivera, 740 Phil. 393 (2014) — Cited as a comparable case where a lawyer who neglected his obligation to secure his client's visa and failed to return money despite demand was suspended for two years; used to support the increased penalty.

• Luna vs. Atty. Galarrita, 763 Phil. 175 (2015) — Cited as a comparable case where a lawyer who failed to promptly inform his client of receipt of settlement proceeds and refused to turn over the amount was suspended for two years; used to support the increased penalty.

• Ford vs. Atty. Daitol, 320 Phil. 53, 58 (1995) — Cited in support of the proposition that failure to file a brief within the reglementary period despite notice constitutes inexcusable negligence.

• Adaza vs. Barinaga, 192 Phil. 198, 201 (1981) — Cited in support of the Court's observation about lawyers making office staff scapegoats for their own negligence.

• Pitcher vs. Atty. Gagate, 719 Phil. 82, 94 (2013) — Cited for the doctrine that disciplinary proceedings should revolve around administrative, not civil, liability, except where the claim involves moneys intrinsically linked to the professional engagement.

• Canon 18, Code of Professional Responsibility — Provides that "A lawyer shall serve his client with competence and diligence." The Court applied this canon to find Atty. Mendez guilty of negligence for failing to file the appellant's brief.

• Rule 18.03, Canon 18, Code of Professional Responsibility — Provides that "A lawyer shall not neglect a legal matter entrusted to him, and his negligence in connection therewith shall render him liable." The Court applied this rule to hold Atty. Mendez liable for his failure to file the appellant's brief.

• Canon 16, Code of Professional Responsibility — Provides that "A lawyer shall hold in trust all moneys and properties of his client that may come into his possession." The Court applied this canon to find Atty. Mendez guilty of violating his fiduciary duty over client funds.

• Rule 16.01, Canon 16, Code of Professional Responsibility — Provides that "A lawyer shall account for all money or property collected or received for or from the client." The Court applied this rule to find Atty. Mendez liable for failing to account for the P300,000.00 received from the client.

• Rule 16.03, Canon 16, Code of Professional Responsibility — Provides that "A lawyer shall deliver the funds and property of his client when due or upon demand." The Court applied this rule to find Atty. Mendez liable for failing to return the client's money despite repeated demands.

Carpio (Chairperson), Perlas-Bernabe, Caguioa, and Reyes, Jr., JJ., concurred.