Sison Vs Atty Valdez

July 31, 2017
A.C. No. 11663

NANETTE B. SISON, represented by DELIA B. SARABIA, Complainant
vs.
ATTY. SHERDALE M. VALDEZ, Respondent
Facts:
Sometime in September 2012, complainant, an overseas Filipino worker in Australia, engaged
respondent's legal services to file an action against Engr. Eddie S. Pua of E.S. Pua Construction
(old contractor) and the project manager, Engr. Dario Antonio (project manager), for failing to
construct complainant's house in Nuvali, Canlubang, Calamba, Laguna in due time.3 Although
no written agreement was executed between the parties specifying the scope of legal services,
respondent received the total amount of ₱215,000.00 from complainant, through Sarabia, on
three (3) separate dates.4 Respondent acknowledged receipt of the first two (2) installments in
a handwritten note, stating that the amount of ₱165,000.00 was for litigation
expenses, i.e., attorney's fees, filing fees, bond, and other expenses.5 The last payment was
deposited online to the bank account of respondent's wife, Ma. Analyn M. Valdez.6
On January 8, 2013, complainant terminated respondent's legal services via e-mail and text
messages7 with a demand to return the amount given, which was not heeded notwithstanding
several demands; Hence, complainant, through Sarabia, filed the instant disbarment complaint
before the Integrated Bar of the Philippines (IBP) - Commission on Bar Discipline (CBD), alleging
that despite receipt of her payments: (a) respondent failed to render his legal services and
update her regarding the status of the case; (b) commingled her money with that of
respondent's wife; (c) misappropriated her money by failing to issue a receipt for the last
installment of the payment received; and (d) fabricated documents to justify retention of her
money.8
In the Report and Recommendation26 dated June 7, 2014, the IBPCBD Investigating
Commissioner (IC) recommended that respondent be reprimanded for violating his obligations
under the CPR with a stem warning never to commit the same mistakes again.27
In a Resolution38 dated January 31, 2015, the IBP Board of Governors adopted and approved
the IC's Report and Recommendation, but modified the penalty to suspension from the
practice of law for a period of six (6) months.
Respondent moved for reconsideration,39 but was denied in a Resolution40 dated September 23,
2016.
Issues:
whether or not respondent violated the CPR and should be suspended from the practice of law
for committing the following acts:
First, he failed to inform his client about the status of the case;
Second, he asked for payment of fees from complainant even before he prepared the draft
complaint;
Third, respondent failed to issue the proper receipt for the full amount he received from
complainant;
Fourth, respondent commingled the funds of his client with that of his wife when he asked
that the ₱50,000.00 be deposited to his wife's bank account;
Ruling:
The SC concurs with the IBP's finding of administrative liability with some modifications.
Records show that in September 2012, complainant engaged respondent's services to file a
money claim, and pursuant to such engagement, complainant paid respondent a total of
₱215,000.00. After a little more than three (3) months, complainant terminated respondent's
legal services due to the latter's failure to render legal services. While it was acknowledged that
respondent did render some legal services to complainant albeit only in the initiatory stage, it
was also established that respondent failed to duly update his client on the developments of
the case. As correctly pointed out by the IBP, respondent's lapses constitute a violation of Rule
18.04, Canon 18 of the CPR, which reads:
CANON 18 - A LAWYER SHALL SERVE HIS CLIENT WITH COMPETENCE AND DILIGENCE.
Rule 18.04 - A lawyer shall keep the client informed of the status of his case and shall respond
within a reasonable time to the client's request for information.
Once a lawyer takes up the cause of his client, a lawyer is duty-bound to serve the latter with
competence and to attend to such client's cause with diligence, care, and devotion. He owes
fidelity to such cause and must always be mindful of the trust and confidence reposed upon
him.41 In this relation, a lawyer has the duty to apprise his client of the status and developments
of the case and all other relevant information.42
In this case, respondent alleged that he waited for complainant's arrival in the Philippines in
November 2012 to personally report on his accomplishments, to have the necessary pleadings
signed, and to explain how the money given will be applied. However, the meeting did not push
through.
Indeed, respondent cannot justify his non-compliance by shifting the blame to complainant for
failing to meet with him, especially so that he failed to inform his client of the pleadings she
needed to sign.
The Court likewise finds that respondent violated Rules 16.01 and 16.03, Canon 16 of the CPR,
which respectively read:
CANON 16 - A LAWYER SHALL HOLD IN TRUST ALL MONEYS AND PROPERTIES OF HIS CLIENT
THAT MAY COME INTO HIS POSSESSION.
Rule 16.01 - A lawyer shall account for all money or property collected or received for or from
the client.
Rule 16.03 - A lawyer shall deliver the funds and property of his client when due or upon
demand. However, he shall have a lien over the funds and may apply so much thereof as may
be necessary to satisfy his lawful fees and disbursements, giving notice promptly thereafter to
his client. x x x.
The highly fiduciary nature of an attorney-client relationship imposes on a lawyer the duty to
account for the money or property collected or received for or from his client. 43 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.44 His failure to return gives rise to a
presumption that he has appropriated it for his own use, and the conversion of funds entrusted
to him constitutes a gross violation of his professional obligation under Canon 16 of the CPR.45
In this case, respondent failed to account for the money received from complainant when he
only acknowledged receipt of ₱165,000.00 for litigation expenses despite admittedly receiving
₱215,000.00. When complainant terminated his legal services, the fact that no case has been
filed in court should have prompted him to immediately return to complainant the amounts
intended as filing and bond fees, as these were obviously unutilized.
In fact, respondent admitted that, based on his belief, he was entitled to only ₱65,000.00 as
compensation for his legal services.46 As such, he should have returned the excess amount of
₱150,000.00 out of the ₱215,000.00 he received from complainant. Notably, Rule 16.03 of the
CPR allows a lawyer to retain the amount necessary to satisfy his lawful fees and
disbursements.47 Hence, respondent's persistent refusal to return the money to complainant
despite several demands renders him administratively liable.
Although the IBP correctly found that respondent is entitled to reasonable compensation for
the limited services he rendered, the Court notes that respondent appears to have waived his
claim for compensation when he agreed to return the amount of ₱200,000.00 in cash and pay
an additional ₱l18,352.00 in exchange for complainant's desistance in the Estafa and
disbarment cases filed against him.48 Thus, the matter of restitution should no longer be an
issue. However, it should be stressed that his administrative liability herein should remain,
considering the rule that a disbarment case is not subject to any compromise.49
WHEREFORE, respondent Atty. Sherdale M. Valdez is found GUILTY of violating Rule 18.04,
Canon 18, as well as Rules 16.01 and 16.03, Canon 16 of the Code of Professional Responsibility.
Accordingly, he is SUSPENDED from the practice of law for a period of three (3) months
effective from the finality of this Resolution, and is STERNLY WARNED that a repetition of the
same or similar acts shall be dealt with more severely.

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July 31, 2017

A.C. No. 11663

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