SECOND DIVISION
[December 8, 1923. ]
VICENTE DIAZ, Complainant, v. RUPERTO KAPUNAN, Respondent.
Attorney-General Villa-Real for the Government.
Perfecto Gabriel and Rafael Palma for Respondent.
SYLLABUS
1. ATTORNEYS-AT-LAW; SUSPENSION AND DISBARMENT; STIFLING OF BIDS AT PUBLIC SALES. — Public policy discountenances combinations or agreements on the part of bidders at execution sales, the object and effects of which are to stifle competition. The courts will consider an agreement between a judgment creditor and one claiming an interest in the thing about to be sold under an execution, that neither shall bid against the other, as void, unless all parties concerned know of the arrangement and consent thereto.
2. ID.; ID.; ID.; ARTICLE 542 OF THE PENAL CODE, CONSTRUED AND APPLIED. — Article 542 punishes "any person who shall solicit and gift or promise as consideration for agreeing to refrain from taking part in any public auction." The crime is consummated by the mere act of soliciting a gift or promise for the purpose of abstaining from taking part in the auction.
3. ID.; ID.; ID.; ID.; INSTANT CASE. — D, the creditor, and K, the attorney of M, the debtor, during the sale at auction of the property of M, entered into the following agreement: "We, Vicente Diaz and Ruperto Kapunan, both being the bidders at the auction held for the sale of the properties of Secundino Mendezona, do hereby agree that Don Ruperto Kapunan should withdraw his bid and refrain from bidding at the said auction as he does hereby withdraw his bid, and in consideration thereof, the said Mr. Diaz offers him a premium of one thousand pesos (P1,000) which, out of consideration to said Don Vicente Diaz, Mr. Kapunan accepts and has, for this reason, refrained from bidding in competition with said Mr. Diaz, Tacloban, Leyte, December 23, 1922 (Sgd) V. Diaz (Sgd.) Ruperto Kapunan." Held: That Attorney K has been guilty of a violation of the provision of article 542 of the penal Code, but certain mitigating circumstances which exert an influence in his favor, can be taken into consideration.
2. ID.; ID.; ID.; ARTICLE 542 OF THE PENAL CODE, CONSTRUED AND APPLIED. — Article 542 punishes "any person who shall solicit and gift or promise as consideration for agreeing to refrain from taking part in any public auction." The crime is consummated by the mere act of soliciting a gift or promise for the purpose of abstaining from taking part in the auction.
3. ID.; ID.; ID.; ID.; INSTANT CASE. — D, the creditor, and K, the attorney of M, the debtor, during the sale at auction of the property of M, entered into the following agreement: "We, Vicente Diaz and Ruperto Kapunan, both being the bidders at the auction held for the sale of the properties of Secundino Mendezona, do hereby agree that Don Ruperto Kapunan should withdraw his bid and refrain from bidding at the said auction as he does hereby withdraw his bid, and in consideration thereof, the said Mr. Diaz offers him a premium of one thousand pesos (P1,000) which, out of consideration to said Don Vicente Diaz, Mr. Kapunan accepts and has, for this reason, refrained from bidding in competition with said Mr. Diaz, Tacloban, Leyte, December 23, 1922 (Sgd) V. Diaz (Sgd.) Ruperto Kapunan." Held: That Attorney K has been guilty of a violation of the provision of article 542 of the penal Code, but certain mitigating circumstances which exert an influence in his favor, can be taken into consideration.
D E C I S I O N
MALCOLM, J.:
This action for malpractice brought by Vicente Diaz against Attorney Ruperto Kapunan, has to do with the conduct of Attorney Kapunan during the legal proceedings which followed the business troubles of Vicente Diaz and Secundino de Mendezona, and particularly relates to the conduct of Attorney Kapunan in civil case No. 2098 of the Court of First Instance of Leyte. The ultimate question on which we would concentrate attention concerns the agreement between Diaz and Kapunan at the time of the sale of the property of Mendezona, whereby Kapunan, on the promise of Diaz to pay him P1,000, agreed to desist from further participation in the sale, all in alleged violation of article 1459 of the Civil Code and article 542 of the Penal Code.
Omitting the irrelevant matter interjected into this case, the principal facts of record are the following:chanrob1es virtual 1aw library
In 1917, Vicente Diaz and Secundino de Mendezona formed a partnership and entered into extensive business transactions in the Province of Leyte. The capital of the partnership was P380,000. Unfortunately, however, the business failed to prosper, with the result that on liquidation, it was found to have suffered a loss of P67,000. When Diaz and Mendezona came to settle up their affairs, they eventually formulated a document of sale and mortgage in which Mendezona recognized a debt in favor of Diaz in the sum of P80,000 and an additional sum of P10,000 owing to Diaz, laid upon the hacienda "Mapuyo," and to be paid within the term of one year. When the year had expired Mendezona was not to be found and his family was unable to meet the payment. There followed the usual proceedings for foreclosure and sale, which, after considerable delay, resulted in the hacienda’s being offered for sale at public auction.
At the time fixed for the sale, December 23, 1922, there appeared Vicente Diaz, accompanied by his lawyer Emilio Benitez, and Attorney Ruperto Kapunan. Luis Velarde, the deputy sheriff of Leyte, is authority for the statement that Kapunan told him that he, Kapunan, was ready to bid on the property up to P16,000 in order to assist the Mendezona family which was in financial straits. At any rate, the bidding was opened by Kapunan offering P12,000 for the property and with Diaz and Kapunan raising the bids until finally Diaz offered P12,500. There the bids stopped on account of Diaz and Kapunan entering into the agreement, of decisive importance, which we next quote in full:jgc:chanrobles.com.ph
"We, Vicente Diaz and Ruperto Kapunan, both being the bidders at the auction held for the sale of the properties of Secundino Mendezona, do hereby agree that Don Ruperto Kapunan should withdraw his bid and refrain from bidding at the said auction as he does hereby withdraw his bid, and in consideration thereof, the said Mr. Diaz offers
Omitting the irrelevant matter interjected into this case, the principal facts of record are the following:chanrob1es virtual 1aw library
In 1917, Vicente Diaz and Secundino de Mendezona formed a partnership and entered into extensive business transactions in the Province of Leyte. The capital of the partnership was P380,000. Unfortunately, however, the business failed to prosper, with the result that on liquidation, it was found to have suffered a loss of P67,000. When Diaz and Mendezona came to settle up their affairs, they eventually formulated a document of sale and mortgage in which Mendezona recognized a debt in favor of Diaz in the sum of P80,000 and an additional sum of P10,000 owing to Diaz, laid upon the hacienda "Mapuyo," and to be paid within the term of one year. When the year had expired Mendezona was not to be found and his family was unable to meet the payment. There followed the usual proceedings for foreclosure and sale, which, after considerable delay, resulted in the hacienda’s being offered for sale at public auction.
At the time fixed for the sale, December 23, 1922, there appeared Vicente Diaz, accompanied by his lawyer Emilio Benitez, and Attorney Ruperto Kapunan. Luis Velarde, the deputy sheriff of Leyte, is authority for the statement that Kapunan told him that he, Kapunan, was ready to bid on the property up to P16,000 in order to assist the Mendezona family which was in financial straits. At any rate, the bidding was opened by Kapunan offering P12,000 for the property and with Diaz and Kapunan raising the bids until finally Diaz offered P12,500. There the bids stopped on account of Diaz and Kapunan entering into the agreement, of decisive importance, which we next quote in full:jgc:chanrobles.com.ph
"We, Vicente Diaz and Ruperto Kapunan, both being the bidders at the auction held for the sale of the properties of Secundino Mendezona, do hereby agree that Don Ruperto Kapunan should withdraw his bid and refrain from bidding at the said auction as he does hereby withdraw his bid, and in consideration thereof, the said Mr. Diaz offers
