Adm. Case No. 927. September 28, 1970
IN THE MATTER OF THE COMPLAINT FOR DISBARMENT OF ATTORNEY POTENCIANO A. PALANCA, WILLIAM C. PFLEIDER, COMPLAINANT, VS. POTENCIANO A. PALANCA, RESPONDENT.
RUIZ CASTRO, J.:
The respondent Atty. Potenciano A. Palanca was for sometime the legal counsel of the
complainant William Pfleider. According to the complainant, he retained the
legal services of Palanca from January 1966, whereas
the latter insists that the attorney-client relationship between them began as
early as in 1960.
At all events, the relations between the two must have attained
such a high level of mutual trust that on October 10, 1968, Pfleider and
his wife leased to Palanca a 1,328-hectare
agricultural land in Hinobaan, Negros
Occidental, known as the Hacienda Asia, for a period of ten years. In their contract, the parties agreed, among
others, that a specified portion of the lease rentals would be paid to Pfleider, and the remainder would be delivered by Palanca to Pfleider’s listed
creditors.
The arrangement worked smoothly until October 14, 1969 when the rupture came with the
filing by Pfleider of a civil suit (civil case 9187
of the CFI of Negros Occidental) against Palanca for rescission of the contract of lease on the
ground of alleged default in the payment of rentals. In his answer to the complaint, Palanca averred full satisfaction of his rental
liabilities, and therefore contended that the lease should continue. He also charged that he had already been
dispossessed of the hacienda by Pfleider and
the latter’s goons at gunpoint and consequently had suffered tremendous
financial losses.
With this history in perspective, we shall now consider the
administrative charges of gross misconduct in office brought by Pfleider against Palanca. The indictment consists of four counts.
First count. In regard to a criminal case for estafa filed in December 1965 by one Gregorio Uy Matiao against Pfleider, the latter instructed Palanca
to offer in settlement the sum of P10,000, payable in
installments, to Uy Matiao
for the dismissal of the case. After
sometime, Palanca reported to Pfleider
that the offer had been rejected.
Finally, in October 1969, Palanca supposedly
informed Pfleider that he had succeeded in negotiating
the dismissal of the estafa case by leaving
the sum of P5,000 with the Dumaguete
City Court where the action was then pending.
Sometime in December 1969, however, Pfleider
was the object of a warrant of arrest in connection with the same estafa case.
It turned out, charged the complainant Pfleider,
that Palanca had not deposited the sum of P5,000 with the Dumaguete City
Court, let alone communicated to Uy Matiao his earlier offer of settlement.
We have closely examined all the pleadings filed by the parties
in this case and the annexes thereto, and it is our view that the first charge
is devoid of merit. In support of his
claim of alleged assurance made by Palanca that the estafa case had already been terminated, Pfleider relies on certain letters written to him by Palanca. Our own
reading of these letters, however, belies his claim. They contain nothing which might reasonably
induce the complainant to believe that the criminal action against him had
been finally settled by his attorney. On
the contrary, the letters merely report a continuing attempt on the part of Palanca to secure a fair bargain for Pfleider. The letter-report of October 10, 1969, invoked by the complainant,
states in no uncertain terms that “I am bargaining this [referring to the estafa case] even for P8,000.00
and I think they will agree. I’ll
finalize this and pay Tingyan on Tuesday. I have already left in Dumaguete
P5,000.00 to show them the color of our money and I
will bring the balance when I go there Tuesday.”
Nothing in the above letter indicates that Palanca
had deposited the sum of P5,000 with the Dumaguete City Court.
What he did state is that he had left that sum in that City to enable
their adversaries to see “the color of our money.” In this
connection, the veracity of the certification by Felicisimo
T. Hilay, Dumaguete branch
manager of RCPI, that he (Hilay) had been holding the
sum of P5,000 during the early part of October in
trust for Pfleider and his lawyer, has not been
assailed by Pfleider.
If Pfleider was the object of a warrant
of arrest in December 1969, no substantial blame can be laid at the door of
the respondent Palanca inasmuch as the latter’s
services were implicitly terminated by Pfleider when
the latter sued his lawyer in October of the same year. While the object of the suit is the
rescission of the contract of lease between the parties, the conflict of
interest which pits one against the other became incompatible with that mutual
confidence and trust essential to every lawyer-client relation. Moreover, Pfleider
fails to dispute Palanca’s claim that on October 26, 1969, Pfleider refused to acknowledge receipt of a certain letter
and several motions for withdrawal, including Palanca’s
withdrawal as counsel in the estafa case.
Second count. Palanca had
fraudulently charged the sum of P5,000 (which he
supposedly had left with the City Court in Dumaguete)
to his rental account with Pfleider as part payment
of the lease rentals of the Hacienda Asia.
Third count. In the same statement of account, Palanca falsely represented having paid, for the account of
Pfleider, one Samuel Guintos
the sum of P866.50 when the latter would swear that he had received only the
sum of P86.50.
These two charges are anchored upon the same “Statement of
Disbursements” submitted by Palanca to Pfleider. It is our
view that this statement is but a memorandum or report of the expenses which Palanca considered as chargeable to the account of Pfleider. By its
very tentative nature, it is subject to the examination and subsequent
approval or disapproval of Pfleider, any and every
error which it contains may be brought to the attention of Palanca
for rectification or adjustment. Viewed
in relation to the contract of lease between Pfleider
and Palanca, this “statement” is but one
aspect of the prestation required of Palanca by the contract.
Whatever breach he might have committed in regard to this prestation would be but a civil or contractual wrong which
does not affect his office as a member of the Bar.
Final count. It is charged that the list of creditors
which Pfleider had “confidentially”
supplied Palanca for the purpose of carrying out the
terms of payment contained in the lease contract was disclosed by Palanca, in violation of their lawyer-client relation, to
parties whose interests are adverse to those of Pfleider.
As Pfleider himself, however, states
“in the execution of the terms of the aforesaid lease contract between the
parties, complainant furnished respondent with a confidential list of his
creditors.” This should indicate that Pfleider
delivered the list of his creditors to Palanca not
because of the professional relation then existing between them, but on account
of the lease agreement. A violation
therefore of the confidence that accompanied the delivery of that list would
partake more of a private and civil wrong than of a breach of the fidelity
owing from a lawyer to his client.
Moreover, Pfleider fails to controvert Palanca’s claim that there is no such thing as a
“confidential” list of creditors and that the list of creditors
referred to by Pfleider is the same list which forms
part of the pleadings in civil case 9187 (the action for rescission of the
lease contract) now pending between the complainant and the respondent lawyer,
and therefore is embraced within the category of public records open to the
perusal of persons properly interested therein.
In sum, we are satisfied, and we so hold, that nothing in Pfleider’s written complaint for disbarment against Palanca and in his reply to Palanca’s
answer supports a prima facie finding of such misconduct in
office by Palanca as would warrant further
proceedings in this case.
ACCORDINGLY, the complaint is hereby dismissed.
Reyes, J.B.L., Acting C.J., Dizon, Makalintal, Fernando, Teehankee, Barredo, Villamor, and Makasiar, JJ., concur.
Zaldivar, J., took no part.
Concepcion, C.J., on official leave.