Suan vs. Gonzalez

Disbarment or suspension requires clear, convincing and satisfactory proof of willful and deliberate misconduct seriously affecting the lawyer's standing and character as an officer of the court. Mere mistake in attachment, unproven falsity of estimated allegations, and parallel proceedings of different nature and reliefs do not meet that standard.

Rufa C. Suan served as Director and Vice President of Rural Green Bank of Caraga, Inc., a rural banking corporation with principal place of business at Montilla Boulevard, Butuan City. Atty. Ricardo D. Gonzalez was one of the bank's stockholders. Their dispute centered on inspection, dividend and appraisal rights, corporate governance, and control between minority and majority stockholders of the bank.

On February 11, 2004, Gonzalez filed a case for mandamus, computation of interests, enforcement of inspection, dividend and appraisal rights, damages and attorney's fees against Rural Green Bank of Caraga, Inc. and the members of its Board of Directors before the Regional Trial Court of Butuan City, Branch 33, praying inter alia for a temporary restraining order enjoining the annual stockholders' meeting and election of the Board of Directors. On February 14, 2004, the trial court issued a temporary restraining order conditioned upon posting of a bond. Thereafter, Gonzalez submitted JCL Bond No. 01626 issued by Stronghold Insurance Company, Incorporated together with a certification issued by then Court Administrator, now Associate Justice, Presbitero J. Velasco, Jr. that, according to the Clerk of Court of the Municipal Trial Court in Cities of Butuan City, Stronghold had no pending obligation and/or liability to the government insofar as confiscated bonds in civil and criminal cases were concerned.

According to Suan, submission of that certification constituted unlawful, dishonest, immoral or deceitful conduct because Gonzalez knew it was applicable only to transactions before the Municipal Trial Court in Cities, not the Regional Trial Court. She further alleged the bond was defective because Stronghold released it despite Gonzalez's failure to put up the required ₱100,000.00 collateral. Separately, Gonzalez, together with Eduardo, Purisima, Ruben and Manuel, all surnamed Tan, had filed a complaint before the Bangko Sentral ng Pilipinas against Ismael E. Andaya and the bank's board for alleged gross violation of good corporate governance principles, representing themselves as minority stockholders with total holdings of more or less ₱5 million while controlling stockholders owned approximately 80% of the authorized capital stock. Suan averred perjury because those figures allegedly contradicted Gonzalez's RTC averments that majority stockholders owned 70% of the outstanding capital stock while minority holdings amounted to ₱6 million. She also charged forum shopping on the ground that the RTC and Bangko Sentral ng Pilipinas cases shared the same causes of action.

Gonzalez, for his part, denied the charges. He attributed the filing to the bonding company which inadvertently attached the certification pertaining to the Municipal Trial Court in Cities, and stated that upon discovery he immediately filed an ex-parte motion to replace it with the certification pertaining to the Regional Trial Court. He maintained compliance with Stronghold's requirements as shown in the March 19, 2004 letter of its Officer-in-Charge Evelyn R. Ramirez, denied any inconsistency warranting perjury, and denied forum shopping because the causes of action and reliefs in the two fora were different. He added that Suan herself was guilty of forum shopping as the disbarment suit was the second one filed against him. In reply, Suan insisted she filed only one disbarment suit, while the two other suits were filed by Joseph Omar Andaya and Dr. Arturo Cruz based on different acts.

• Wrong Certification and Dishonesty: Complainant maintained that contrary to the IBP findings, respondent's submission of the wrong certification on Stronghold's capacity to issue bonds was deliberate and with intent to mislead, thereby violating the Code of Professional Responsibility, since one interested in a temporary restraining order is expected to examine all documents and attachments.
• Defective Injunction Bond: Complainant argued that the bond was wrongfully released without the required collateral, as shown in the February 28, 2004 letter of Evelyn R. Ramirez which the IBP ignored, and that protesting the bond before the trial court was not a prerequisite to the administrative complaint, especially as she learned of the defects long after the bond expired.
• IBP Resolution Defective: Complainant argued that the assailed Resolution should be reversed because it failed to state clearly the facts and reasons on which it was based and ignored the evidence she presented.

• Inadvertence and Correction: Respondent argued that the bonding company inadvertently attached the certification pertaining to the Municipal Trial Court in Cities, and that upon discovery he immediately filed with the RTC an ex-parte motion to replace it with the certification pertaining to the RTC.
• Compliance with Collateral: Respondent maintained that he satisfactorily complied with Stronghold's requirements as shown in the March 19, 2004 letter of its Officer-in-Charge Evelyn R. Ramirez.
• No Perjury: Respondent argued that there was no inconsistency between the allegations in the RTC and Bangko Sentral ng Pilipinas complaints and thus no liability for perjury.
• No Forum Shopping and Counter-Charge: Respondent argued that there was no forum shopping because the causes of action and reliefs prayed for before the trial court and the Bangko Sentral ng Pilipinas were different, and that complainant herself was guilty of forum shopping since the present suit was the second disbarment suit filed against him.

• Dishonest Conduct and Defective Bond: Whether respondent violated the Code of Professional Responsibility by deliberately submitting an MTCC certification to the RTC and by obtaining a defective injunction bond without required collateral.
• Perjury: Whether respondent committed perjury by alleging inconsistent stockholding figures in the complaints before the RTC and the Bangko Sentral ng Pilipinas.
• Forum Shopping: Whether respondent committed forum shopping by filing the intra-corporate case before the RTC and the governance complaint before the Bangko Sentral ng Pilipinas.

• Dishonest Conduct and Defective Bond: No. Inadvertent attachment promptly corrected by motion for substitution, without motive or advantage, was not willful falsehood or dishonest conduct, and the later March 19, 2004 letter established compliance with collateral requirements.
• Perjury: No. No contradictory statements were made where BSP figures were qualified as estimates, and falsity plus lack of belief in truth was not proved by clear preponderant evidence.
• Forum Shopping: No. The RTC action and BSP complaint were of different nature and reliefs, with no res judicata effect between them, and disclosure in the certification negated willful and deliberate forum shopping.

• Dishonest Conduct and Defective Bond: Not every mistake or oversight in documents filed in court amounts to dishonest, deceitful or deliberate misleading. Respondent had nothing to gain by submitting the wrong certification and instead risked outright denial or dismissal, while the bonding company was equally qualified to issue bonds for RTC cases, negating reason for deliberate substitution. Prompt filing of a manifestation with motion to replace the MTCC certification with the RTC certification militated against intent to deceive, and complainant failed to show both the dubious character of the act and motivation as required for suspension or disbarment. The February 28, 2004 Ramirez letter was correctly disregarded in light of her March 19, 2004 letter informing the trial court of compliance with the required collateral.
• Perjury: Perjury requires proof of two elements: the statement was false and the maker did not believe it to be true, and conviction cannot rest merely on contradictory sworn statements without other evidence proving which statement is false. No contradiction existed because the BSP pleading alleged minority holdings of more or less ₱5 million and controlling holdings of approximately 80% of authorized capital stock, which as mere estimates did not contradict the RTC allegations of ₱6 million and 70% of outstanding capital stock. No malice was shown, and inexactness was attributed to the bank's refusal to allow inspection of books, leaving the required standard of proof unmet.
• Forum Shopping: Forum shopping exists only with identity of parties or interests, identity of rights asserted and reliefs founded on the same facts, and such identity that judgment in one would be res judicata in the other. The RTC intra-corporate case formally demanded legal rights cognizable only by courts — disclosure of stockholdings, inspection of books and records, damages, and a temporary restraining order against the stockholders' meeting and board election. The BSP complaint invoked supervisory powers over banking operations, seeking investigation of alleged unsafe and unsound practices and corrective measures to prevent collapse, such that a BSP ruling on soundness would not directly affect resolution of intra-corporate controversies. Moreover, forum shopping must be willful and deliberate to merit discipline, and respondent's certification disclosing the BSP complaint substantially complied with Section 5, Rule 7 of the Rules of Court and negated willfulness.

• Burden of Proof in Disbarment — In disbarment proceedings the burden rests on the complainant, and the case must be established by clear, convincing and satisfactory proof, with clear preponderant evidence required in view of the serious consequence of disbarment or suspension. Applied to reject the charges where willful falsehood, dishonest motive, and dubious character of the acts were not shown.
• Perjury; Contradictory Statements and Falsity — Perjury requires (1) proof that the statement is false and (2) proof that the accused did not believe it to be true; a conviction cannot be sustained merely upon contradictory sworn statements without other evidence proving which statement is false. Applied to hold that estimated figures qualified by more or less and approximately were not contradictory, and falsity and disbelief were not proved.
• Forum Shopping; Requisites and Willfulness — Forum shopping is the filing of multiple suits involving the same parties for the same cause of action, simultaneously or successively, to obtain a favorable judgment, requiring (a) identity of parties or interests, (b) identity of rights asserted and reliefs founded on the same facts, and (c) res judicata effect between them; to merit discipline it must be willful and deliberate under Section 5, Rule 7 of the Rules of Court. Applied to distinguish a judicial intra-corporate action from a BSP supervisory complaint seeking different reliefs, with disclosure negating willfulness.
• Disbarment as Public Interest; Exercise with Great Caution — Disbarment proceedings preserve courts from unfit practitioners but the power to disbar must be exercised with great caution and only in a clear case of misconduct seriously affecting the lawyer's standing and character as officer of the court and member of the bar. Applied to affirm dismissal where misconduct was not clearly established, citing Urban Bank, Inc. vs. Peña and Resurreccion vs. Sayson.

• "It is well-settled that in disbarment proceedings, the burden of proof rests upon the complainant and the case against the respondent must be established by clear, convincing and satisfactory proof." — States the evidentiary standard controlling dismissal where dishonest motive and willful falsehood were not proved.
• "There are two essential elements of proof for perjury: (1) the statement made by the defendants must be proven false; and (2) it must be proven that the defendant did not believe those statements to be true." — Recites the canonical perjury test borrowed from Villanueva vs. Secretary of Justice to reject the charge based on estimated figures.
• "The essence of forum shopping is the filing of multiple suits involving the same parties for the same cause of action, either simultaneously or successively, for the purpose of obtaining a favorable judgment." — Defines forum shopping to distinguish the RTC judicial action from the BSP supervisory complaint.
• "However, the power to disbar must be exercised with great caution and only in a clear case of misconduct which seriously affects the standing and character of the lawyer as an officer of the Court and member of the bar." — States the cautionary principle justifying affirmance of dismissal for lack of merit.

• Concepcion vs. Fandiño, Jr., 389 Phil. 474, 481 (2000) — Cited for the rule that clear preponderant evidence is necessary to justify administrative penalty in light of the serious consequence of disbarment or suspension.
• Rudecon Management Corporation vs. Camacho, Adm. Case No. 6403, August 31, 2004, 437 SCRA 202, 208 — Cited for requiring proof not only of the dubious character of the act but also of motivation to establish willful resort to falsehood and dishonest conduct.
• Villanueva vs. Secretary of Justice, G.R. No. 162187, November 18, 2005, 475 SCRA 495 — Controlling precedent on perjury elements and insufficiency of mere contradictory sworn statements without independent proof of falsity.
• Tiboli Agro-Industrial Development, Inc. vs. Solilapsi, 442 Phil. 499, 507 (2002) — Cited for the essence of forum shopping as multiple suits for the same cause of action to obtain a favorable judgment.
• Prubankers Association vs. Prudential Bank & Trust Company, G.R. No. 131247, January 25, 1999, 302 SCRA 74, 83-84 — Cited for the three requisites of forum shopping constitutive of lis pendens and res judicata.
• Supena vs. De La Rosa, 334 Phil. 671, 677 (1997) — Cited to characterize the RTC intra-corporate case as a formal demand of legal rights in a court of justice, not forum shopping.
• Urban Bank, Inc. vs. Peña, 417 Phil. 70, 77 (2001) — Cited for the principle that disbarment proceedings are matters of public interest for public welfare and preservation of courts.
• Resurreccion vs. Sayson, 360 Phil. 313, 321 (1998) — Cited for requiring great caution and a clear case of misconduct seriously affecting standing and character before disbarring.

• Code of Professional Responsibility — Invoked as basis for alleged unlawful, dishonest, immoral or deceitful conduct in submitting the wrong certification; held inapplicable absent proof of deliberate intent to mislead.
• Section 5, Rule 7, Rules of Court — Requires certification against forum shopping with complete statement of any pending action or claim; respondent's disclosure of the BSP complaint was held substantial compliance negating willful and deliberate forum shopping.

Ma. Alicia Austria-Martinez, Romeo J. Callejo, Sr., Minita V. Chico-Nazario, Antonio Eduardo B. Nachura