SECOND DIVISION
G.R. No. 225207, September 29, 2021
ATTY. ARISTOTLE T. DOMINGUEZ, Petitioner, v. BANK OF COMMERCE, AS PURPORTED TRANSFEREE OF TRADERS ROYAL BANK, AND SPOUSES CARMELO, JR. AND ELIZABETH AFRICA, Respondents.
D E C I S I O N
HERNANDO, J.:
Petitioner Atty. Aristotle T. Dominguez (Atty. Dominguez) filed a Petition for Review on Certiorari with Motion to Refer Case to Court of Appeals for Mediation1 challenging the June 22, 2015 Decision2 of the Court of Appeals (CA) which denied his Petition for Certiorari3 assailing the January 28, 20134 and September 16, 20135 Orders of the Regional Trial Court (RTC), Branch 193 of Marikina City, involving his motion to fix attorney's fees and motion for production of compromise agreement.6
The Antecedents:
In 2007, respondent Carmelo Africa Jr. (Carmelo), together with his brothers Carlos and Chito, engaged the legal services of Atty, Dominguez in order to prevent the Bank of Commerce (BOC) from taking possession of their family homes in Marikina City, Antipolo City and Quezon City with a total redemption price of P25 million,7 Atty. Dominguez charged P250,000.00 or one percent (1%) of the redemption price as his acceptance fee.
Additionally, Carmelo and his brothers promised him a success fee corresponding to twenty percent (20%) of the amount reduced from the original redemption price.8 Meanwhile, it came to the knowledge of Atty, Dominguez that the initial redemption price set by the BOC was P100 million. He averred that he failed to charge the proper acceptance fee due to the misrepresentation of Carmelo and his brothers as to the redemption price of the properties.9
In 2009, Carmelo and his brothers once again sought the legal services of Atty. Dominguez in a suit involving Hanjin Heavy Industries and Construction Co., Ltd. The lawyer who previously handled the case emerged victorious up to the appellate court. However, his services were terminated and was substituted by Aitv. Domiguez who then initiated execution proceedings against Hanjin. Notwithstanding his efforts, Atty. Dominguez's legal services were likewise terminated.10
Meanwhile, BOC filed a petition11 for cancellation of adverse claim, on Transfer Certificate of Title (TCT) Nos. 473882 and 473883. This petition was opposed12 by the spouses Carmelo arid Elizabeth Africa (spouses Africa) through Atty. Dominguez. During the hearing, BOC manifested that there might be a settlement between the parties to which the spouses Africa did not interpose any objections.13 In October 2012, Atty. Dominguez filed before the trial court a Request for Admission14 of the aforesaid allegations. A month later, Atty, Dominguez manifested that he was no longer representing the spouses Africa as oppositors in the petition for cancellation of adverse claim.
In January 2013, Atty, Dominguez filed a Motion to Fix Attorney's Fees and to Approve Charging (Attorney's) Lien with Motion for Production of Compromise Agreement (Motion to Fix Attorney's Fees).15
Orders of the Regional Trial Court:
In its January 28, 2013 Order,16 the trial court decreed in this wise:chanroblesvirtualawlibrary
On the other hand, Atty. Aristotle Dominguez, former counsel of record of the oppositor was also in court for the hearing of Ms Motion to Fix Attorney's Fees and to Approve (Charging Attorney's Lien) with Motion for Production of Compromise Agreement.On reconsideration,18 Atty. Pominguez asserted that a Compromise Agreement19 was entered into by BOC and the spouses Africa even if such was denied by the parties during trial. At the same time, lie interposed his right to be compensated for the legal services he rendered resulting in the decrease of the redemption price and for preventing the BOC from taking possession of the properties.20 However, the trial court denied Atty. Dominguez's motion for reconsideration in its September 16, 2013 Order,the dispositive portion reads:chanroblesvirtualawlibrary
Acting on the comment of Atty. Baybay on the motion of Atty. Dominguez that the said motion should be made once the judgment has been rendered or before the execution of the judgment on the case, the hearing of the said motion is hereby held in abeyance until a resolution or judgment in this case is rendered by the court. Meanwhile, Atty. Dominguez has no personality to appear in this case.
x x x
SO ORDERED.17
WHEREFORE, foregoing premises considered, the motion for reconsideration is hereby denied on the ground that the claim for attorney's fees by the herein movant Atty. Dominguez should be claimed in a separate civil esse.Undeterred, Atty. Dominguez filed a Petition for Certiorari23 before the CA ascribing grave abuse of discretion on the part of the trial court in issuing the assailed Orders. Atty. Dominguez mainly contended that the proper remedy for him is to claim attorney's fees in the same case where he rendered his service and acted as counsel rather than through an independent action in order to avoid multiplicity of suits.24
SO ORDERED.
In summary, the issues for resolution are the following:Issues:
I. The Honorable Court of Appeals gravely erred in ruling in its Resolution dated 16 June 2016 that "in petitions for cancellation of adverse claim in transfer of certificates of title, trial courts are restricted to rule on the issue on propriety or impropriety of the adverse claim " (invoking Diaz-Duarte v. Spouses Ong, G.R. No. 130352, November 3, 1998) and "Thus, they cannot rule on money judgments".
II. The Honorable Court of Appeals gravely erred in further ruling in its Resolution dated 16 June 201,6 that "the proceedings in {petitions for cancellation of adverse claim in transfer of certificates of title) are in effect summary in nature and the issue therein is limited. Being summary in nature, they are inadequate for the litigation of other issues, such as the issue on attorney's fees, which properly pertain to separate civil actions" and that "the authority of the court a quo is limited to the determination of the propriety or impropriety of the adverse claim " and that "Petitioner should have pursued his claim in a separate action".
III. The Honorable Court of Appeals gravely erred in ruling in its Resolution dated 16 June 2016 that "Lastly, the Compromise Agreement, which was allegedly the basis of petitioner's claim for attorney's fees, was never apart of the proceedings before it Thus, the court a quo cannot properly rule on the issue based on such agreement".
IV. The Honorable Court of Appeals gravely erred in ruling in its Resolution dated 16 June 2016 that "A charging lien to be enforceable as security for the payment of attorney's fees, requires as a condition sine qua non a judgment for money and execution in pursuance of such judgment secured in the main action by the attorney in favor of his client. In the petition before the court a quo, there is no judgment of money involved in which his services were rendered, such that, therefore, petitioner's claim for attorney's fees below is misplaced.35
SECTION 70, Adverse Claim, x x x.While the trial court is directed to speedily hear the case on the validity of the adverse claim, there is no prohibition or any restriction on the trial court from hearing issues on money judgment particularly on matters concerning attorney's fees and lien. There is thus no basis to BOC's argument that Atty. Dominguez could not assert the issue concerning his legal fees in the petition for the cancellation of adverse claim itself.44 Since Atty. Dominguez represented the spouses Africa as oppositors in the petition for cancellation of adverse claim, he may then advance his claim thereon.
x x x
[A]ny party ire interest pay Ste a petition in the Court of First Instance where the land is situated for the cancellation of the adverse claim, and the court shall grant a speedy hearing upon the question of the validity of such adverse claim, and shall render judgment as may be just and equitable. If the adverse claim is adjudged to be invalid, the registration thereof shall, be ordered cancelled. If, in any case, the court, after notice and hearing, shall find that the adverse claim thus registered was frivolous, it may fine the claimant in an amount not less than one thousand pesos nor more than five thousand pesos, in its discretion, xxx. (Emphasis Supplied)43
Rule 20.1 — A lawyer shall be guided by the following factors in determining his fees:Granting that a compromise agreement had been reached by the parties, the same may be used to determine the counsel's lawful fees provided it is produced and admitted before the trial court for proper scrutiny and consideration. Gubat v. National Power Corporation is instructive, to wit:chanroblesvirtualawlibrary
a) The time spent and the extent of the services rendered or required;
b) The novelty and difficulty of the questions involved;
c) The importance of the subject matter;
d) The skill demanded;
e) The probability of losing other employment as a result of acceptance of the proffered case;
f) The customary charges for similar services and the schedule of fees of the IBP chapter to which he belongs;
g) The amount Involved in the controversy and the benefits resulting to the client from the service;
h) The contingency or certainty of compensation;
i) The character of the employment, whether occasional or established; and
j) The professional standing of the lawyer.56
A client may enter into a compromise agreement without the intervention of the lawyer, but the terms of the agreement should not deprive the counsel of his compensation for the professional services he had rendered. If so, the compromise shall be subjected to said fees, x x x.Thus, when a compromise agreement is entered into by the patties and as a consequence of which, the suit did not result in a court's judgment on money claims, said compromise agreement may serve as a basis in the award for attorney's fees. Furthermore, quantum meruit, which means as much as he deserves, is likewise a basis especially when the attorney-client relationship was severed prior to the finality of the case. Villarama v. Da Jesus mandates such effect in this wise;
x x x
x x x. As the validity of a compromise agreement cannot be prejudiced, so should not be the payment of a lawyer's adequate and reasonable compensation for his services should the suit end by reason of the settlement. X x x. A lawyer is as much entitled to judicial protection against injustice or imposition of fraud on the part of his client as the client is against abuse on the part of his counsel. The duty of the court is not only to ensure that a lawyer acts in a proper and lawful manner, but also to see to it that a lawyer is paid his just fees.58 (Emphasis supplied)
Once the attorney has performed the task assigned to him in a valid agreement, his compensation is determined on the basis of what he and the client agreed. In the absence of the written agreement, the lawyer's compensation shall be based on quantum meruit, which means "as much as he deserved." The determination of attorney's fees on the basis of quantum meruit is also authorized "when the counsel, for justifiable cause, was not able to finish the case to its conclusion."60Since Atty. Domiguez rendered his legal services in the petition for cancellation of adverse claim for the spouses Africa, he is then entitled to his attorney's fees. In the usual course, when the lawyer has established his entitlement to attorney's fees, the case will then be remanded to the trial court for the proper determination of the amount on the basis of quantum, meruit. In other instances, this Court found it prudent to fix the attorney's fees to finally put an end to the issue.
Section 37. Attorneys' liens. — x x x. He shall also have a lien to the same extent upon all judgments for the payment of money, and executions issued in pursuance of such judgments, which he has secured in a litigation of his client, from and after the time when he shall have the caused a statement of his claim of such lien to be entered upon the records of the court rendering such judgment, or issuing such execution, and shall have the caused written notice thereof to be delivered to his client rod to the adverse party; and he shall have the same right and power over such judgments and executions as his client would have to enforce his lien and secure the payment pf his just fees and disbursements.It is clear from the said provision that attorney's lien attaches on all money judgments and on the subsequent execution thereof which the lawyer secured in advocating the cause of his client in a litigation, provided that (1) the lawyer caused the registration of his lien on the records of the court; and (2) the lawyer caused a written notice to such effect to be delivered to his client and to the adverse party. Logically, it would, be absurd to charge or enforce a lien without judgment or resolution of the case as there is absence of basis for the determination of the legal fees.
While in this jurisdiction the lien does not attach, to the property in litigation, it is obvious that it should attach to the proceeds of the judgment for the payment of money, otherwise, the lien would be meaningless and of no substance. A judgment for money is only as valuable as the amount that could be realized, therefrom; an.-.! to speak, of a lien on. the judgment without including therein its proceeds, at least in pecuniary terms, is to lose perspective in the differentiation of substance and form.68Also, in Palanca,69 this Court En Banc distinguished registration and enforcement of lien such that a statement of lien may be registered even before the rendition of judgment, while enforcement may only be done after a judgment has been secured in favor of the client, to wit:chanroblesvirtualawlibrary
Under this provision we are of the opinion that the attorney may cause a statement of his lies? to be registered even before the rendition of any judgment, the purpose feeing merely to establish his right to the lien, The recording Is distinct from the enforcement of the lien, which may take place only after jiictgraeiit is secured in favor of the client. We believe also that the provision permits the registration of an. attorney's lien, although the lawyer concerned does not finish the case successfully in favor of his client, because an attorney who quits or is dismissed before the conclusion of his assigned task is as much entitled to the protection of the rule. Otherwise, a client may easily frustrate its purpose. (Emphasis supplied)70Since the 1954 pronouncement of this Court In Palanca71 up to the present, We have consistently held that a final money judgment In favor of the counsel's client is significant so that charging of attorneys lien may commence. Otherwise, the enforcement of attorney's Hen would have no leg to stand on. Navarez v. Abrogar III72 reflects the same doctrine which reads:chanroblesvirtualawlibrary
The registration of the lien should also be distinguished from the enforcement of the lien. Registration merely determines the birth of the lien. The enforcement of the Ilea, oh the other hand, can only take place once a final money judgment has been secured in favor of the client. The enforcement of the lien is a claim for attorney's fees that may be prosecuted in the very action where the attorney rendered his services or in a separate action. (Emphasis supplied)73In sum, while attorney's Hen may be recorded, before the finality of the judgment, its enforcement presupposes an existing final monetary judgment or a resolution of the case. We acknowledge the entitlement of Atty. Dominguez to his lawful and legal fees for the services he rendered to the spouses Africa in the petition for cancellation of adverse claim among others, regardless of the fact that the attorney-client relationship was severed prior to the resolution of the case or the settlement between the spouses Africa and BOC.
Endnotes:
* Designated as additional Member per Raffle dated August 25, 2021 vice J. Gaerlan who recused due to prior action in the Court of Appeals.
1Rollo, pp. 17-61.
2 Id. at 63-76. Penned by Associate Justice Maria Elisa Sempio Diy and concurred in by Associate Justices Ramon M. Bato, Jr. and Manuel M. Barrios.
3 Id. at 143-161.
4 Id. at 162. Penned by Judge Alice C. Gutierrez,
5 Id. at 163-165.
6 CA rollo, pp. 25-30.
7Rollo, pp. 64-65.
8 Id. at 65.
9 Id.
10 Id.
11 Id. at 163-165.
12 Id. at 164.
13 Id. at 164.
14 CA rollo, pp. 69-74.
15 Id. at 25-32.
16 Id. at 21.
17 Id.
18 CA rollo, pp. 33-43,
19 Id. at 35.
20Rollo, p, 48.
21 CA rollo, pp. 22-24.
22 Id. at 24.
23Rollo, pp. 143-161.
24 CA rollo, pp. 14-17.
25Rollo, pp. 63-76.
26 Id. at 73.
27 752 Phil. 1, 10 (2015), citing Traders Royal Bank Employees Union-Independent v. NLRC, 356 Phil. 705. 713-714 (1997).
28 Rollo, pp. 73-74.
29 Id. at 74-75.
30 Id. at 74.
31 Id. at 75.
32 CA rollo, pp. 233-289.
33Rollo, pp. 134-139.
34 Supra note 1.
35Rollo, pp. 38-39, 48.
36 Id. at 304-305. See also rollo, pp. 73-75.
37 Id. at 281-284,
38 Id. at 38-39.
39 Id. at 40.
40 Navarez v. Abrogar III , 768 Phil. 297, 306-307 (2015).
41 CA rollo, pp. 25-32.
42 Id. at 29.
43 PROPERTY REGISTRATION DECREE or P.D. No. 1529. Dated June 11, 1978.
44Palencia v. Linsangan, 836 Phil. 1, 15 (2018).
45 358 Phil. 876, 884-885 (1998).
46 587 Phil, 175, 184 (2008).
47Aquino v. Casabar, 752 Phil. 11 (2015).
48Heirs and/or Estate of Siapian v. Intestate Estate of Mackay, 644 Phil. 207, 212-213 (2010).
49Bacolod Murcia Milling Co., Inc. v. Henares, 107 Phil. 560, 568 (1960).
50Palanca v. Pecson, 94 Phil, 419, 423 (1954).
51 Id. at 423.
52Rollo, p. 74.
53 Id. at 286.
54 Id. at 48.
55 Id. at 337.
56 CODE OF PROFESSIONAL RESPONSIBILITY, Dated June 21, 1988.
57 627 Phil. 551 (2010).
58 Id. at 566-567 (2010).
59 808 Phil. 725 (2017).
60 Id. at 735-736.
61Rollo, pp. 73-74.
62 260 Phil. 389, 399(1990).
63Rollo, pp. 285-236.
64 107 Phil. 560, 568-569 (1960).
65 94 Phil. 419, 421-423 (1954).
66Rollo, pp. 50-53.
67 Supra note 49.
68Bacolod Murcia Milling Co., Inc. v. Henares, supra note 49 at 567.
69 Supra note 50.
70 Id. at 422.
71 Id.
72 Supra note 40.
73 Supra note 40.
74 Supra note 2.cralawredlibrary