Mendoza vs. Santiago, Jr.

A lawyer-notary public violates the 2004 Rules on Notarial Practice and the Code of Professional Responsibility when he notarizes multiple documents for the same transaction with conflicting terms, where the evident purpose is to lessen the client's tax liability, as this constitutes an act of defiance against the law and a breach of the solemnity of the notarial act.

The case arose from a property dispute among the heirs of Adela Espiritu-Barlaan. Following her death, certain heirs executed an Extrajudicial Settlement with Waiver and Transfer of Rights, adjudicating the subject property to themselves. This document was notarized by the respondent. Subsequently, the heir who obtained title executed two Deeds of Absolute Sale over a portion of the property in favor of the same buyer, both notarized by the respondent. The first deed stated a sale price of ₱3,130,000.00, while the second, which was submitted to the Registry of Deeds, stated a price of ₱1,500,000.00. This discrepancy formed the basis of the administrative complaint against the respondent.

• Parties and Property: Complainant Celia D. Mendoza is an heir of Adela Espiritu-Barlaan, who died intestate leaving a parcel of land in Makati City.
• Extrajudicial Settlement: On October 25, 2013, other heirs (Gemma S. Barlaan and her children) executed an Extrajudicial Settlement with Waiver and Transfer of Rights, adjudicating the property to themselves. Respondent notarized this document.
• First Deed of Sale: On November 26, 2014, heir John Alexander Barlaan executed a Deed of Absolute Sale over 147 sqm of the property in favor of Monette Abac Ramos for ₱3,130,000.00. Respondent notarized this deed.
• Second Deed of Sale: On March 12, 2015, John Alexander Barlaan executed another Deed of Absolute Sale over the same 147 sqm in favor of Monette Abac Ramos for ₱1,500,000.00. Respondent also notarized this deed. The second deed was submitted to the Registry of Deeds.
• Ejectment Case: Monette Abac Ramos filed an ejectment complaint, attaching her judicial affidavit where she stated the purchase price was ₱3,130,000.00 per the first deed. The MeTC ruled in her favor.
• Administrative Complaint: Complainant filed the instant disbarment complaint, alleging respondent's notarization of the two deeds with different amounts violated ethical rules.

• Legal Personality: Petitioner argued she had legal personality to file the complaint based on her personal knowledge of the facts.
• Violation of Rules: Petitioner maintained that respondent's act of notarizing two deeds with different amounts for the same property was a scheme to minimize taxes, violating the 2004 Rules on Notarial Practice and Canon 1 of the Code of Professional Responsibility.

• Lack of Personality: Respondent countered that complainant had no legal personality to file the complaint and that the ownership issue had been resolved with finality.
• No Moment: Respondent argued that notarizing the two deeds was of no moment because he had already discharged his official functions by submitting the documents to the Bureau of Internal Revenue and the Register of Deeds.

• Notarial Practice and Professional Ethics: Whether respondent violated the 2004 Rules on Notarial Practice and the Code of Professional Responsibility by notarizing two deeds of absolute sale for the same property with different stated considerations.
• Sanctions: What administrative sanctions are appropriate for such a violation.

• Notarial Practice and Professional Ethics: The act of notarizing two deeds with conflicting sale prices for the same property, for the purpose of minimizing the client's tax liability, constitutes a violation of the 2004 Rules on Notarial Practice and Canon 1 (and specifically Rule 1.02) of the Code of Professional Responsibility. The notarization of the second deed with a lower amount facilitated the evasion of correct taxes, which is an activity aimed at defiance of law.
• Sanctions: The appropriate penalties are: (1) suspension from the practice of law for two years; (2) immediate revocation of notarial commission; and (3) disqualification from being commissioned as a notary public for two years. These sanctions are commensurate with the gravity of the offense and are consistent with prevailing jurisudence and the new Code of Professional Responsibility and Accountability (CPRA).

• Solemnity of Notarial Acts — Notarization is not a routinary act but one imbued with substantive public interest. It converts a private document into a public document, entitling it to full faith and credit. A notary public must observe utmost care to protect the integrity of the document and the act it embodies. The Court applied this doctrine to find that the respondent failed in his duty by notarizing a document that was patently intended for an illegal purpose (tax evasion).
• Lawyer's Duty to Uphold the Law — Under Canon 1, Rule 1.02 of the CPR (now reflected in the CPRA), a lawyer shall not counsel or abet activities aimed at defiance of the law. The Court applied this to hold that the respondent, by knowingly participating in the execution of a second deed with a lower consideration to reduce taxes, abetted an illegal scheme and made a mockery of the solemnity of the oath.

• "Notarization is not an empty, meaningless routinary act. It is invested with substantive public interest. The notarization by a notary public converts a private document into a public document, making it admissible in evidence without further proof of its authenticity." — This passage underscores the public duty inherent in notarization, which the respondent breached.
• "When the respondent notarized an illegal and fraudulent document, he is entitling full faith and credit upon the face of the document, which it does not deserve, considering its nature and purpose." — This highlights the consequence of the respondent's act on the integrity of public documents.

• Lopez v. Ramos, A.C. No. 12081 (2020) — Cited as a case with similar circumstances where a lawyer notarized a second deed to reduce capital gains tax. The Court followed its ruling that such an act violates the CPR and Notarial Rules.
• Caalim-Verzonilla v. Pascua — Cited as an analogous case where a lawyer prepared and notarized two extrajudicial settlements with different considerations to evade taxes. The Court applied the penalty imposed therein (two-year suspension, revocation of commission, and two-year disqualification) to the present case.
• Gonzales v. Atty. Ramos, 499 Phil. 345 (2005) — Cited for the doctrine on the solemnity and public interest of notarial acts.

• 2004 Rules on Notarial Practice, Rule IV, Section 4(a) — Prohibits notaries public from performing a notarial act if the transaction is unlawful or immoral. The Court found the respondent violated this by notarizing the second deed intended for tax evasion.
• Code of Professional Responsibility, Canon 1, Rule 1.02 — Provides that a lawyer shall not counsel or abet activities aimed at defiance of the law. The Court held the respondent violated this by facilitating the tax evasion scheme.
• Code of Professional Responsibility and Accountability (CPRA), Section 33(p), Canon VI — Classifies violation of notarial rules attended by bad faith as a serious offense. The Court used this to justify the severity of the sanctions.

• Justice Alfredo Benjamin S. Caguioa (Chairperson)
• Justice Henri Jean Paul B. Inting
• Justice Maria Filomena D. Dimaampao
• Justice Singh