PETITION FOR AUTHORITY TO CONTINUE USE OF THE FIRM NAME “SYCIP, SALAZAR, FELICIANO, HERNANDEZ & CASTILLO”, LUCIANO E. SALAZAR, FLORENTINO P. FELICIANO, BENILDO G. HERNANDEZ, GRE…

Two separate Petitions were filed before this Court 1) by the
surviving partners of Atty. Alexander Sycip, who died
on May 5, 1975, and 2) by the surviving partners of Atty. Herminio
Ozaeta, who died on February 14, 1976, praying that
they be allowed to continue using, in
the names of their firms,
the names of partners who had passed
away.  In the Court’s Resolution of September
2, 1976, both
Petitions were ordered consolidated.

Petitioners base their petitions on the following arguments:

1. Under the law, a partnership is not prohibited from continuing
its business under a firm name which includes the name of a deceased partner;
in fact, Article 1840 of the Civil Code explicitly sanctions the practice when
it provides in the last paragraph that:

“The use by the person or partnership continuing the business
of the partnership name, or the name of a deceased partner as part thereof,
shall not of itself make the individual property of the deceased partner liable
for any debts contracted by such person or partnership.”^[1]

2. In regulating other professions, such as accountancy and
engineering, the legislature has authorized the adoption of firm names without
any res­triction as to the use, in such firm name, of the name of a deceased
partner;^[2] the legislative authorization given
to those engaged in the practice of accountancy – a profession requiring the
same degree of trust and confidence in respect of clients as that implicit in
the relationship of attorney and client – to acquire and use a trade name,
strongly indicates that there is no fundamental policy that is offended by the
continued use by a firm of professionals of a firm name which includes the name
of a deceased partner, at least where such firm name has acquired the
characteristics of a “trade name.”^[3]

3. The Canons of Professional Ethics are not transgressed by the
continued use of the name of a deceased partner in the firm name of a law
partnership because Canon 33 of the Canons of Professional Ethics adopted by
the American Bar Association declares that:

“x x
x The continued use of the name of a deceased
or former partner when permissible by local custom, is not unethical, but care
should be taken that no imposition or deception is practiced through this use. 
x x x”^[4]

4. There is no possibility of imposition or deception because the
deaths of their respective deceased partners were well-publicized in all
newspapers of general circulation for several days; the stationeries now being
used by them carry new letterheads indicating the years when their respective
deceased partners were connected with the firm; petitioners will notify all
leading national and international law directories of the fact of their
respective deceased partners’ deaths.^[5]

5. No local custom prohibits the continued use of a deceased
partner’s name in a professional firm’s name;^[6]
there is no custom or usage in the Philippines,
or at least in the Greater Manila Area, which recognizes that the name of a law
firm necessarily identifies the individual members of the firm.^[7]

6. The continued use of a deceased partner’s name in the firm name
of law partnerships has been consistently allowed by U.S. Courts and is an
accepted practice in the legal profession of most countries in the world.^[8]

The question involved in these Petitions first came under
consideration by this Court in 1953 when a law firm in Cebu (the Deen case) continued
its practice of including in its firm name that of a deceased partner, C.D.
Johnston.  The matter was resolved with
this Court advising the firm to desist from including in their firm designation
the name of C. D. Johnston, “who has long been dead.”

The same issue was raised before this Court in 1958 as an
incident in G.R. No. L-11964, entitled Register of Deeds of Manila vs. China
Banking Corporation.  The law firm of
Perkins & Ponce Enrile moved to intervene as amicus
curiae.  Before acting thereon,
the Court, in a Resolution of April
15, 1957, stated that it “would like to be informed why the
name of Perkins is still being used although Atty. E. A. Perkins is already
dead”.  In a Manifestation dated May
21, 1957, the law firm of Perkins and Ponce Enrile, raising
substantially the same arguments as those now being raised by peti­tioners,
prayed that the continued use of the firm name “Perkins & Ponce Enrile” be held proper.

On June 16,
1958, this Court
resolved:

“After carefully considering the reasons given by Attorneys
Alfonso Ponce Enrile and Associates for their
continued use of the name of the deceased E. G. Perkins, the Court found no
reason to depart from the policy it adopted in June 1953 when it required
Attorneys Alfred P. Deen and Eddy A. Deen of Cebu City to desist from
including in their firm designation, the name of C. D. Johnston, deceased.  The Court believes that, in view of the
personal and confidential nature of the relations between attorney and client,
and the high standards demanded in the canons of professional ethics, no
practice should be allowed which even in a remote degree could give rise to the
possibility of deception.  Said attorneys
are accordingly advised to drop the name “PERKINS” from their firm
name.”

Petitioners herein now seek a re-examination of the policy thus
far enunciated by the Court.

The Court finds no sufficient reason to depart from the rulings
thus laid down.

A. Inasmuch as “Sycip, Salazar,
Feliciano, Hernandez and Castillo” and “Ozaeta,
Romulo, De Leon, Mabanta
and Reyes” are partnerships, the use in their partnership names of the
names of deceased partners will run counter to Article 1815 of the Civil Code
which provides:

“Art. 1815.  Every
partnership shall operate under a firm name, which may or may not include the
name of one or more of the partners.

“Those who, not being members of the partnership, include
their names in the firm name, shall be subject to the liability of a
partner.”

It is clearly tacit in the above provision that names in a firm
name of a partnership must either be those of living partners and, in the case
of non-partners, should be living persons who can be subjected to
liability.  In fact, Article 1825 of the
Civil Code prohibits a third person from including his name in the firm name
under pain of assuming the liability of a partner.  The heirs of a deceased partner in a law firm
cannot be held liable as the old members to the creditors of a firm
particularly where they are non-lawyers. 
Thus, Canon 34 of the Canons of Professional Ethics “prohibits an
agreement for the payment to the widow and heirs of a deceased lawyer of a
percentage, either gross or net, of the fees received from the future business
of the deceased lawyer’s clients, both because the recipients of such division
are not lawyers and because such payments will not represent service or
responsibility on the part of the recipient.” Accordingly, neither the
widow nor the heirs can be held liable for transactions entered into after the
death of their lawyer-predecessor.  There
being no benefits accruing, there can be no corresponding liability.

Prescinding the law, there could be
practical objections to allowing the use by law firms of the names of deceased
partners.  The public relations value of the use of an old firm name can tend
to create undue advantages and disadvantages in the practice of the
profession.  An able lawyer without
connections will have to make a name for himself starting from scratch.  Another able lawyer, who can join an old
firm, can initially ride on that old firm’s reputation established by deceased
partners.

B. In regards to the last paragraph of Article 1840 of the Civil
Code cited by petitioners, supra, the first factor to consider is that
it is within Chapter 3 of Title IX of the Code entitled “Dissolution and
Winding Up.” The Article primarily deals with the exemption from liability
in cases of a dissolved partnership, of the individual property of the deceased
partner for debts contracted by the person or partnership which continues the business
using the partnership name or the name of the deceased partner as part
thereof.  What the law contemplates
therein is a hold-over situation preparatory to formal re­organization.

Secondly, Article 1840 treats more of a commercial
partnership with a good will to protect rather than of a professional
partnership, with no saleable good will but whose reputation depends on the
personal qualifications of its individual members.  Thus, it has been held that a saleable
goodwill can exist only in a commercial partnership and cannot arise in a
professional partnership consisting of lawyers.^[9]

“As a general rule, upon the dissolution of a commercial
partnership the succeeding partners or parties have the right to carry on
the business under the old name, in the absence of a stipulation forbidding it,
(s)ince the name of a commercial partnership is a
partnership asset inseparable from the good will of the firm x x x x
.” (60 Am Jur 2d,s 204, p. 115) (Emphasis
supplied)

On the other hand,

“x x x a professional
partnership the reputation of which depends on the individual skill of the
members, such as partnerships of attorneys or physicians, has no good
will to be distributed as a firm asset on its dissolution, however
intrinsically valuable such skill and
reputation may be, especially where there is no provision in the partnership
agreement relating to good will as an asset. 
x x x” (ibid, s 203, p. 115) (Emphasis supplied)

C. A partnership for the practice of law cannot be likened to
partnerships formed by other professionals or for business.  For one thing, the law on accountancy
specifically allows the use of a trade name in connection with the practice of accountancy.^[10]

“A partnership for
the practice of law is not a legal entity.  It is a mere relationship or association for
a particular purpose.  x x x It is not a partnership formed for the purpose of
carrying on a trade or business or of holding property.”^[11] Thus, it has been stated that
“the use of a nom de plume, assumed or trade name in law practice is
improper.”^[12]

“The usual reason given for different standards of conduct
being applicable to the practice of law from those pertaining to business is
that the law is a ‘profession.’ x x x

“Dean Pound, in his recently published contribution to the
Survey of the Legal Profession, (The Lawyer from Antiquity to Modern Times,
p. 5) defines a profession as ‘a group of men pursuing a learned art as a
common calling in the spirit of public service, — no less a public service
because it may incidentally be a means of livelihood.’

x x x              x x x                 x x x

“Primary characteristics which distinguish the legal
profession from business are:

1.  A duty of public service, of which the
emolument is a byproduct, and in which one may attain the highest eminence
without making much money.

2.  A relation as an ‘officer of court’ to the
administration of justice involving thorough sincerity, integrity, and
reliability.

3.  A relation to clients in the highest degree
fiduciary.

4.  A relation to colleagues at the bar
characterized by candor, fairness, and unwillingness to resort to current business
methods of advertising and encroachment on their practice, or dealing directly with their clients.”^[13]

“The right to practice law is not a natural or
constitutional right but is in the nature of a privilege or franchise.^[14] It is limited to persons of good
moral character with special qualifications duly ascertained and certified.^[15]
The right does not only presuppose in its possessor integrity, legal standing
and attainment, but also the exercise of a special privilege, highly personal and partaking of the nature of a
public trust.”^[16]

D. Petitioners cited Canon 33
of the Canons of Professional Ethics of the American Bar Association^[17]
in support of their petitions.

It is true that Canon 33 does not consider as unethical
the continued use of the name of a deceased or former partner in the firm name
of a law partnership when such a practice is permissible by local custom
but the Canon warns that care should be taken that no imposition or deception
is practiced through this use.

It must be conceded that in the Philippines,
no local custom permits or allows the continued use of a deceased or
former partner’s name in the firm names of law partnerships.  Firm names, under our custom, identify the
more active and/or more senior members or partners of the law firm.  A glimpse at the
history of the firms of petitioners and of other law firms in this country would show how their
firm names have evolved and changed from time to time as the composition of the
partnership changed.

“The continued use of a firm name after the death of one or
more of the partners designated by it is proper only where sustained by
local custom and not where by custom this purports to identify the
active members.  x x x

“There would seem to be a question, under the working of the
Canon, as to the propriety of adding the name of a new partner and at the same time retaining that of a deceased
partner who was never a partner with the new one.” (H.S. Drinker,
op. cit., supra, at pp. 207-208) (Emphasis supplied)

The possibility of deception upon the public, real or
consequential, where the name of a deceased partner continues to be used cannot
be ruled out.  A person in search of
legal counsel might be guided by the familiar ring of a distinguished name
appearing in a firm title.

E. Petitioners argue that U.S. Courts have consistently allowed
the continued use of a deceased partner’s name in the firm name of law
partnerships.  But that is so because it
is sanctioned by custom.

In the case of Mendelsohn v. Equitable Life Assurance Society (33
N.Y.S. 2d 733) which petitioners Salazar, et al. quoted in their memorandum,
the New York Supreme Court sustained the use of the firm name Alexander &
Green even if none of the present ten partners of the firm bears either name because the practice was sanctioned by custom and
did not offend any statutory provision or legislative policy and was adopted by
agreement of the parties.  The Court
stated therein:

“The practice sought to be proscribed has the sanction of custom and offends no statutory provision or
legislative policy.  Canon 33 of the
Canons of Professional Ethics of both the American Bar Association and the New
York State Bar Association provides in part as follows: ‘The continued use of
the name of a deceased or former partner, when permissible by local custom is
not unethical, but care should be taken that no imposition or deception is
practiced through this use.’ There
is no question as to local custom.  Many firms in the city use
the names of deceased members with the approval of other attorneys, bar
associations and the courts.  The
Appellate Division of the First Department has considered the matter and
reached the conclusion that such practice should not be prohibited.  (Emphasis supplied)

x x
x              x
x x                 x x x

“Neither the
Partnership Law nor the Penal Law prohibits the practice in
question.  The use of the firm name
herein is also sustainable by reason of agreement between the partners.”^[18]

Not so in this jurisdiction where there is no local custom that
sanctions the practice.  Custom has been
defined as a rule of conduct formed by repetition of acts, uniformly observed
(practiced) as a social rule, legally binding and obligatory.^[19]
Courts take no judicial notice of custom. 
A custom must be proved as a fact, according to the rules of evidence.^[20]
A local custom as a source of right cannot be considered by a court of justice
unless such custom is properly established by competent evidence like any other
fact.^[21]
We find such proof of the existence of a local custom, and of the elements
requisite to constitute the same, wanting herein.  Merely because something is done as a matter
of practice does not mean that Courts can rely on the same for purposes of
adjudication as a juridical custom. 
Juridical custom must be differentiated from social custom.  The former can supplement statutory law or be
applied in the absence of such statute. 
Not so with the latter.

Moreover, judicial decisions applying or interpreting the laws
form part of the legal system.^[22]
When the Supreme Court in the Deen and Perkins cases
issued its Resolutions directing lawyers to desist from including the names of
deceased partners in their firm designation, it laid down a legal rule against
which no custom or practice to the contrary, even if proven, can prevail.  This is not to speak of our civil law which
clearly ordains that a partnership is dissolved by the death of any partner.^[23] Customs which are contrary to law,
public order or public policy shall not
be countenanced.^[24]

The practice of law is intimately
and peculiarly related to the administration of justice and should not be
considered like an ordinary “money-making trade.”

“x
x x It is of the
essence of a profession that it is practiced in a spirit of public
service.  ‘A trade’ x x x ‘aims primarily at
personal gain; a profession at the exercise of powers beneficial to mankind.’
If, as in the era of wide free opportunity, we think of free competitive self
assertion as the highest good, lawyer and grocer and farmer may seem to be
freely competing with their fellows in
their calling in order each to acquire as much of the world’s good as he may
within the limits allowed him by law. 
But the member of a profession does not regard himself as in competition
with his professional brethren.  He is not
bartering his services as is the artisan nor exchanging the products of his skill and learning as the farmer sells
wheat or corn.  There should be no such
thing as a lawyers’ or physicians’ strike. 
The best service of the professional man is often rendered for no
equivalent or for a trifling equivalent and it is his pride to do what he does
in a way worthy of his profession even if done with no expectation of
reward.  This spirit of public service in
which the profession of law is and ought to be exercised is a prerequisite of
sound administration of justice according to law.  The other two elements of a profession,
namely, organization and pursuit of a learned art have their justification in
that they secure and maintain that spirit.”^[25]

In fine, petitioners’ desire to preserve the identity of their
firms in the eyes of the public must bow to legal and ethical impediments.

ACCORDINGLY, the petitions filed herein are denied and
petitioners advised to drop the names “SYCIP” and “OZAETA”
from their respective firm names.  Those
names may, however, be included in the listing of individuals who have been
partners in their firms indicating the years during which they served as such.

SO ORDERED.

Teehankee, Concepcion,
Jr., Santos, Fernandez, Guerrero, and De
Castro, JJ., concur.

Fernando, C.J., and Abad Santos, JJ., no part.

Barredo, Makasiar, and Antonio, JJ., joins J., Aquino in his dissent.

^[1]
See Memorandum of Salazar, et al., p. 5; see also Petition of Romulo, et al., p. 3.

^[2]
Citing Sec. 16-A, Public Act No. 3105, as amended by Commonwealth Act No. 342;
Sec. 39, Commonwealth Act No. 294; Sec. 23, Republic Act No. 318; Sec. 39,
Republic Act No. 184.

^[3]
Memorandum of Salazar, et al., pp. 7-8.

^[4]
Memorandum of Salazar, et al., pp.
8-10; Petition of Romulo, et al., pp. 3-4.

^[5]
Memorandum of Salazar, et al., p. 13;
Petition of Romulo, et al., p. 4.

^[6]
Petition of Romulo,
et al., p. 4.

^[7]
Memorandum of Salazar, et al., p. 11.

^[8]
Memorandum of Salazar, et al., pp. 6-7
and pp. 16-18; Petition of Romulo, et al., p. 5.

^[9]
Seddal vs. Keating, 8 App. Div. 2d 44, 185
NYS 2d 630, affd 7 NY 2d 846, 196 NYS 2d 986, 164 NE
2d 860.

^[10]
Section 16-A, Commonwealth Act No. 342.

^[11]
In re Crawford’s Estate, 184 NE 2d 779, 783.

^[12]
H.S. Drinker, Legal Ethics (1953), p. 206; see also Canon 33, par. 2, Canons of
Professional Ethics.

^[13]
H.S. Drinker, Legal Ethics (1953) pp.
4-5.

^[14]
7 C.J.S. 708.

^[15]
5 Am Jur 270.

^[16]
In re Lavine,
41 P2d 161, all cited in Martin, Legal and Judicial Ethics, Fifth Ed., p. 8.

^[17]
Canons 1 to 32 which were adopted by the American Bar Association in 1908 were
also adopted by the Philippine Bar Association in 1917.  The American Bar Association adopted Canons
33 to 45 in 1928, Canon 46 in 1933 and Canon 47 in 1937.  On April 20, 1946, when Canons 33 to 47 where
already in effect, the Revised Constitution of the Philippine Bar Association
was approved and it provided that the Association “adopts and makes its
own the Code of Ethics of the American Bar Association.” (Martin, Legal
and Judicial Ethics, Fifth Ed. p. 341).

^[18]
33 N.Y.S. 2d 733, 734.

^[19]
JBL Reyes & RC Puno,
Outline of Philippine Civil Law, Fourth Ed., Vol. 1, p. 7.

^[20]
Article 12,
Civil Code.

^[21]
Patriarca vs. Orate, 7 Phil. 390, 395 (1907).

^[22]
Art. 8, Civil Code.

^[23]
Art. 1830, Civil Code.

^[24]
Art. 11, Civil Code.

^[25]
Roscoe Pound, The
Lawyer From Antiquity To Modern Times,
(1953), pp. 9-10.