G.R. No.

173940 September 5, 2006

TOMAS G. TAN & CST ENTERPRISES INC., represented by (Formerly CBD Case No. 02-967)
NELSON G. TAN,

- versus

IBP COMMISSION ON BAR DISCIPLINE and ATTY. JAIME SORIANO

Facts: In January of 2002, petitioner Tomas G. Tan (petitioner Tan), stockholder and director
of co-petitioner CST Enterprises, Inc. (CST), discovered that two parcels of land owned by the
corporation were used to obtain loans from Philippine Business Bank (PBB), with the real estate
mortgage annotated at the back of the titles covering the properties. Upon verification, he learned
that a certain John Dennis Chua, representing CST, mortgaged the properties. Chua was
purportedly authorized by the Board of Directors of the corporation as shown by the Corporate
Secretarys Certificate signed by Atty. Jaime N. Soriano (respondent).

Petitioner Tan filed in his personal capacity and as minority stockholder of CST under a
derivative action, a letter-complaint with the IBP charging respondent of deceit, malpractice,
falsification of public documents, gross misconduct and violation of oath of office. According to
petitioners, respondent has never been elected as corporate secretary nor acted as such for CST,
and in fact no board meeting was held on 30 March 2001 to so authorize John Dennis Chua because
on the said date two of three directors, petitioner Tan and Felipe Chua, were out of the
country. Furthermore, John Dennis Chua has never been connected in any capacity with CST,
petitioners aver.

Petitioners also filed with the RTC of Makati a civil case captioned as Declaration of
Unenforceability of Promissory Notes and Mortgage, Nullity of Secretarys Certificate,
Injunction, Damages, etc. with Prayer for Issuance of TRO/ Preliminary Injunction,
against respondent, Atty. Stephen Z. Taala and PBB, along with other persons. In the civil case,
petitioners claim to have gathered more information and seen the extent of the plot or machinations
of respondent and the participation of other individuals, including Atty. Taala who was the
Assistant Vice President for Legal Services of PBB.

On 16 June 2003, petitioners filed with the IBP, Commission on Bar Discipline
(Commission) a Motion to Amend/Supplement the Complaint with Motion to Admit
Amended/Supplemental Complaint, claiming that respondent and Atty. Taala had facilitated and
recommended the approval of the allegedly spurious loans and mortgage entered into by John
Chua. The Commission denied the motion on the ground that the amendments/supplements
involve proceedings pending before the trial courts and that the determination of the matters
presented belong to said courts which have already acquired jurisdiction over them.
Reconsideration sought by the Petitioner was denied by the Commission.

Petitioners filed before this Court a petition for certiorari under Rule 65, wherein they
impute grave abuse of discretion on the part of the Commission. They claim that the denial to
admit the Amended/Supplemental Complaint would have the effect of preventing petitioners from
filing a new complaint against respondent along with Atty. Taala for their conspiratorial illegal
acts involving the same loan transactions, as any judgment of the Commission on the original
complaint may serve as res judicata to bar judgment on the other acts complained of in the
Amended/Supplemental Complaint.

In his Comment before the Court, respondent claims that petitioners breached the rule that
proceedings against attorneys should be kept private and confidential, when the latter disclosed in
the civil case the contents of his Verified Answer filed before the Commission, quoting almost
verbatim said contents. This had the effect of announcing to the whole world the pending
disbarment case, respondent stresses, and is meant to harass and vex him, as well as to damage his
reputation even before a final verdict is reached by the Commission. Respondent questions
petitioners motive in not filing a separate case before the IBP against Atty. Taala and accordingly
having him tried separately. Finally, respondent posits that the Commission did not commit grave
abuse of discretion in denying petitioners motion to amend its complaint since the nullity or
regularity of the mortgage loan in CSTs name is not an issue in the administrative case against
him.

Issue(s):
1. Whether or not the Commission committed grave abuse of discretion when it denied
petitioners Amended/Supplemental Complaint.
2. Whether or not the petitioners breached Section 18, Rule 139-B of the Rules of Court which
states that proceedings against attorneys should be kept private and confidential.

Ruling:

1. No, the Commission did not commit grave abuse of discretion.

 Petitioners have filed Civil Case No. 02-299, seeking the declaration of unenforceability
of promissory notes and mortgage, nullity of secretarys certificate, injunction, damages, and the
issuance of a temporary restraining order or preliminary injunction. Likewise pending is another
case against respondent and John Dennis Chua, et al. for estafa through falsification of public
documents, docketed as Criminal Case No. 04-3776 of the RTC of Makati which appears to
involve the same allegedly unauthorized mortgage.

Petitioners are seeking similar, if not identical, reliefs from the regular courts and the
Commission. Thus, in addition to the prayer to disbar respondent and Atty. Taala, petitioners
implored the Commission to make a finding that respondent lawyers be found liable for using
untruthful statements under oath, conspiracy to commit estafa, employing deceit and other
manipulative acts as well as fraud, and falsification of public documents charges which are
included in his allegations in the civil and criminal cases.

The Commission is not empowered to resolve matters which are pending resolution by the
regular courts to which jurisdiction properly pertains. The IBP, particularly the Commission on
Bar Discipline, is merely tasked to investigate and make recommendations on complaints for
disbarment, suspension and discipline of lawyers. It is not a regular court and thus is not endowed
with the power to investigate and resolve judicial matters pending before the regular courts.

Disbarment proceedings are sui generis, they belong to a class of their own, and are distinct
from that of civil or criminal actions. To be sure, a finding of liability in a civil case or a conviction
in a criminal case is not necessary for finding a member of the bar guilty in an administrative
proceeding. However, in the instant case, the civil and criminal cases involving the acts referred
to in the proposed amended/supplemental complaint are still pending adjudication before the
regular courts. Prudence dictates that the action of the Commission related to the proposed
amended/supplemental complaint in the administrative case be sustained in order to avoid
contradictory findings in that case and in the court cases.

2. Yes, petitioners divulged confidential information in violation of Section 18, Rule 139-B
of the Rules of Court

Petitioners lifted and cited most of the amendatory averments in respondents Verified Answer
in the administrative case as the core of their Amended Complaint in the civil case. Disciplinary
proceedings against a lawyer are private and confidential until its final determination. The
confidential nature of the proceedings has a three-fold purpose, to wit: (i) to enable the court and
the investigator to make the investigation free from any extraneous influence or interference; (ii)
to protect the personal and professional reputation of attorneys from baseless charges of
disgruntled, vindictive and irresponsible persons or clients by prohibiting the publication of such
charges pending their resolution; and (iii) to deter the press from publishing the charges or
proceedings based thereon.

Petitioners had in effect announced to the world the pending disbarment case against
respondent. Not only did they disclose the ongoing proceedings, they also divulged most, if not all
of the contents of respondents Verified Answer. Clearly, petitioners acts impinged on the
confidential nature of the disbarment proceedings against Atty. Soriano.

WHEREFORE, the petition is DISMISSED. Petitioners are REMINDED to preserve the

confidentiality of the administrative proceedings. The IBP is ordered to resume its hearings in
CBD No. 02-267 consistently with this resolution. Costs against petitioners.