EN BANC

 
 
NICOLAS O. TAN, A.C. No. 6483
Complainant,
Present:
 
Puno, C.J.,
Quisumbing,
Ynares-Santiago,
Sandoval-Gutierrez,
Carpio,
- versus - Austria-Martinez,
Corona,
Carpio-Morales,
Azcuna,
Tinga,
Chico-Nazario,
Garcia,
Velasco, Jr.,
Nachura, and
Reyes, JJ.
ATTY. AMADEO E. BALON, JR.,
Respondent. Promulgated:
August 31, 2007
x ---------------------------------------------------------------------------------------- x
 
DECISION
 
YNARES-SANTIAGO, J.:
 
 
On July 13, 2004, Nicolas O. Tan filed a complaint against Atty. Amadeo E.
Balon, Jr. for misappropriation of funds and issuance of bum checks.
 
Tan alleged that he engaged the services of Atty. Balon relative to the returned
checks issued to the former by Jose G. Guisande. Atty. Balon sent demand letters
to Guisande but thereafter failed to inform Tan about the status of the same. Tan
alleged that as a fellow Rotarian, he regularly met Atty. Balon but the latter said
nothing about the case.
 
Tan thus engaged the services of another lawyer, Atty. Romualdo Jubay, who filed
an estafa case against Guisande. During the proceedings, Guisandes counsel
informed Tan and Atty. Jubay that out of the P96,085.00 originally
owed, P60,000.00 was already collected by Atty. Balon.
 
When confronted by Tan, Atty. Balon admitted that he collected the amount
of P60,000.00 from Guisande. He then proposed to Tan that 20% of
the P60,000.00 or P12,000.00 be applied as attorneys fees. He offered to pay the
remaining balance of P48,000.00 with interest of 6% from September 29,
1999 to January 13, 2003 by issuing two postdated checks. However, the two
checks issued by Atty. Balon bounced for reason account closed when presented
for payment.
 
Upon being informed of the dishonor, Atty. Balon offered to settle his obligations
by depositing cash in Tans account. However, he was only able to deposit a total
amount of P20,000.00. Despite several demands, Atty. Balon failed to fully settle
his obligations. Thus, Tan filed the instant complaint.
 
In his Comment, Atty. Balon alleged that he had fully paid his obligations; that on
several occasions, he rendered legal services to Tan for free; that the administrative
complaint was intended to harass him and to stop him from filing a collection case
for unpaid legal services against Tan.
 
On December 8, 2004, we referred the complaint to the Integrated Bar of the
Philippines (IBP) for investigation. The IBP held a mandatory conference and
conducted a hearing on August 24, 2005. During the hearing, Atty. Balon admitted
that he was not able to fully pay his obligations to Tan.[1] The parties were then
directed to submit their respective position papers on or before September 12,
2005.
 
Complainant submitted his position paper. Respondent, however, submitted
a Motion to Suspend the Period to File Position Paper and to Defer the Submission
of the Case for Resolution and With Motion to Set Case for Trial and/or Reception
of Evidence. In the same Motion, particularly paragraph 6 thereof, respondent
claimed that the IBP has no jurisdiction over the complaint as it concerns a
contract of loan, rather than a fiduciary transaction of lawyer-client relationship.
The IBP granted the motion and scheduled the hearing on December 6, 2005.
 
Subsequently, however, the Investigating Commissioner learned that respondent
had been disbarred by the Court in Lemoine v. Balon, Jr.[2] on October 28, 2003, or
even prior to the institution of the instant complaint. Thus, the IBP deemed the
proceedings closed and terminated for lack of disciplinary jurisdiction over
respondent in view of his prior disbarment. At the same time, it ordered respondent
to show cause why he should not be cited for contempt for failing to inform the
IBP of his disbarment and for continuing to represent that he is still a member of
the Bar.
 
In his explanation, respondent alleged that he assumed the IBP knew of his
disbarment; that his disbarment attained finality only on April 12, 2005; and that
he intended to discuss his disbarment in the position paper he is yet to submit to
the IBP.
 
Unsatisfied with the explanation, the IBP recommended that respondent be cited
for contempt for continuing to practice law despite his disbarment.
 
On March 7, 2007, we required the parties to manifest whether they are willing to
submit the case for resolution. However, on May 4, 2007, complainant filed an
Affidavit of Desistance claiming that the filing of the instant case was a product of
misunderstanding and misapprehension of facts; and that he and the respondent
had cleared their differences and reconciled their accounting
records. Consequently, he is no longer interested in pursuing the complaint.
 
On the other hand, respondent filed on May 8, 2007 a Manifestation and Motion
claiming that considering complainants Affidavit of Desistance, it would be
prudent for the Supreme Court to refer the matter back to the IBP.
 
In Lemoine v. Balon, Jr., respondent was found unfit to remain as a member of the
Bar after committing malpractice, deceit, and gross misconduct. He received the
check corresponding to his clients insurance claim, falsified the check and made it
payable to himself, encashed the same and appropriated the proceeds. The Court
found his acts so appalling and his character grossly flawed that it ruled in this
wise:
 
Specifically with respect to above-quoted provision of Canon 16
of the Code of Professional Responsibility, the Filipino lawyers principal
source of ethical rules, which Canon 16 bears on the principal complaint
of complainant, a lawyer must hold in trust all moneys and properties of
his client that he may come to possess. This commandment entails
certain specific acts to be done by a lawyer such as rendering an
accounting of all money or property received for or from the client as
well as delivery of the funds or property to the client when due or upon
demand. Respondent breached this Canon when after he received the
proceeds of complainants insurance claim, he did not report it to
complainant, who had a given address in Makati, or to his co-attorney-
in-fact Garcia who was his contact with respect to complainant.
 
In fact, long after respondent received the December 23,
1998 check for P525,000.00 he, by his letter of March 26, 1999 to
Garcia, had even the temerity to state that the claim was still pending and
recommend acceptance of the 50% offer . . . which is P350,000.00
pesos. His explanation that he prepared and sent this letter on Garcias
express request is nauseating. A lawyer, like respondent, would not and
should not commit prevarication, documented at that, on the mere
request of a friend.
 
By respondents failure to promptly account for the funds he
received and held for the benefit of his client, he committed professional
misconduct. Such misconduct is reprehensible at a greater degree, for it
was obviously done on purpose through the employment of deceit to the
prejudice of complainant who was kept in the dark about the release of
the check, until he himself discovered the same, and has to date been
deprived of the use of the proceeds thereof.
 
A lawyer who practices or utilizes deceit in his dealings with his
client not only violates his duty of fidelity, loyalty and devotion to the
clients cause but also degrades himself and besmirches the fair name of
an honorable profession.
 
That respondent had a lien on complainants funds for his attorneys
fees did not relieve him of his duty to account for it. The lawyers
continuing exercise of his retaining lien presupposes that the client
agrees with the amount of attorneys fees to be charged. In case of
disagreement or when the client contests that amount for being
unconscionable, however, the lawyer must not arbitrarily apply the funds
in his possession to the payment of his fees. He can file, if he still deems
it desirable, the necessary action or proper motion with the proper court
to fix the amount of such fees.
 
In respondents case, he never had the slightest attempt to bring the
matter of his compensation for judicial determination so that his and
complainants sharp disagreement thereon could have been put to an end.
Instead, respondent stubbornly and in bad faith held on to complainants
funds with the obvious aim of forcing complainant to agree to the
amount of attorneys fees sought. This is an appalling abuse by
respondent of the exercise of an attorneys retaining lien which by no
means is an absolute right and cannot at all justify inordinate delay in the
delivery of money and property to his client when due or upon demand.
 
Respondent was, before receiving the check, proposing a
25% attorneys fees. After he received the check and after complainant
had discovered its release to him, he was already asking for
50%, objection to which complainant communicated to him. Why
respondent had to doubly increase his fees after the lapse of about one
year when all the while he has been in custody of the proceeds of the
check defies comprehension. At any rate, it smacks of opportunism, to
say the least.
 
As for respondents claim in his June 2001 Supplement to his
Counter-Affidavit that he had on several occasions
from May 1999 to October 1999 already delivered a total of P233,000.00
out of the insurance proceeds to Garcia in trust for complainant, this
does not persuade, for it is bereft of any written memorandum thereof. It
is difficult to believe that a lawyer like respondent could have entrusted
such total amount of money to Garcia without documenting it, especially
at a time when, as respondent alleged, he and Garcia were not in good
terms. Not only that. As stated earlier, respondents Counter-Affidavit
of February 18, 2000 and his December 7, 1999 letter to complainant
unequivocally contained his express admission that the total amount
of P525,000.00 was in his custody. Such illogical, futile attempt to
exculpate himself only aggravates his misconduct. Respondents claim
discredited, the affidavits of Leonardo and Roxas who, acting allegedly
for him, purportedly gave Garcia some amounts forming part of
the P233,000.00 are thus highly suspect and merit no consideration.
 
 The proven ancillary charges against respondent reinforce the
gravity of his professional misconduct.
 
The intercalation of respondents name to the Chinabank check
that was issued payable solely in favor of complainant as twice
certified by Metropolitan Insurance is clearly a brazen act of
falsification of a commercial document which respondent resorted to in
order to encash the check.
 
Respondents threat in his December 7, 1999 letter to expose
complainant to possible sanctions from certain government agencies
with which he bragged to have a good network reflects lack of character,
self-respect, and justness.
 
It bears noting that for close to five long years respondent has
been in possession of complainants funds in the amount of over half a
million pesos. The deceptions and lies that he peddled to conceal, until
its discovery by complainant after about a year, his receipt of the funds
and his tenacious custody thereof in a grossly oppressive manner point to
his lack of good moral character. Worse, by respondents turnaround in
his Supplement to his Counter-Affidavit that he already delivered to
complainants friend Garcia the amount of P233,000.00 which, so
respondent claims, is all that complainant is entitled to, he in effect has
declared that he has nothing more to turn over to complainant. Such
incredible position is tantamount to a refusal to remit complainants
funds, and gives rise to the conclusion that he has misappropriated them.
 
In fine, by respondents questioned acts, he has shown that he is no
longer fit to remain a member of the noble profession that is the law.
 
WHEREFORE, respondent Atty. Amadeo E. Balon, Jr., is found
GUILTY of malpractice, deceit and gross misconduct in the practice of
his profession as a lawyer and he is hereby DISBARRED. The Office of
the Clerk of Court is directed to strike out his name from the Roll of
Attorneys and to inform all courts and the Integrated Bar of
the Philippines of this Decision.
 
Respondent is ordered to turn over to complainant, Daniel
Lemoine, the amount of P525,000.00 within thirty (30) days from notice,
without prejudice to whatever judicial action he may take to recover his
attorneys fees and purported expenses incurred in securing the release
thereof from Metropolitan Insurance.
 
SO ORDERED.
 
It appears that after the chastisement he received from the Court and despite having
been stripped of the privilege to practice law, respondent was unrepentant and
unmoved as he continued to commit falsehood and dishonest acts.
 
In the instant case, respondent collected the money intended for his client without
informing the latter of such receipt. Worse, he used the amount for personal
purposes. It was almost four years from the time he received the money that his
client knew of the collection. Although respondent offered to pay the amount, he
was not able to fully pay the same. He even had the temerity to allege in his
comment that he has fully paid the amount only to admit during the hearing
conducted by the IBP that he only paid a portion thereof. Moreover, the checks he
issued to Tan as payment bounced for insufficiency of funds.
 
Notwithstanding his disbarment on October 28, 2003, he continued to
represent himself as a lawyer, not only before the IBP but also before this Court. In
the Motion for Extension dated October 5, 2004, respondent signed his name under
Balon Law Office and appended his PTR, IBP and Roll numbers.[3] He also signed
as Notary Public in the Affidavit of Service of Sally I. Leonardo.[4]
 
In his Comment dated October 21, 2004, respondent prayed in the alternative that
the case be referred to the IBP[5] despite his prior disbarment. Again he signed his
name below Balon Law Office[6] and as Notary Public in the Affidavit of Service.[7]
 
In the Rejoinder dated December 15, 2004, respondent reiterated his prayer that the
case be referred to the IBP for investigation[8] despite knowledge of IBPs lack of
jurisdiction in view of his prior disbarment. He again appended his name under
Balon Law Office together with his Roll number.[9]
 
There is no merit in respondents contention that he continued to represent himself
as a lawyer because the disbarment became final only on April 12, 2005. Good
faith and fair dealing require him to disclose his disbarment. Instead, he continued
to sign the pleadings as a lawyer and as notary public.
 
Moreover, we note that even after the disbarment became final on April 12, 2005,
respondent continued to represent himself as a lawyer. During the IBP hearing
on August 24, 2005, he deliberately failed to mention his prior disbarment. In
the Motion to Suspend the Period to File Position Paper and to Defer the
Submission of the Case for Resolution and With Motion to Set Case for Trial
and/or Reception of Evidence dated September 9, 2005, although he did not
append the title Attorney to his name, yet he affixed his PTR, IBP and Roll
numbers under his signature. The same is true with the Urgent Motion for
Postponement dated November 23, 2005. This notwithstanding the Courts
Decision on October 28, 2003 to strike out his name from the Roll of Attorneys.
 
As a former lawyer, respondent should know that the IBPs jurisdiction is limited to
the members of the Bar. In fact, in the Motion to Suspend the Period to File
Position Paper and to Defer Submission of the Case for
Resolution dated September 9, 2005, respondent alleged that the IBP has no
jurisdiction over the instant complaint because it allegedly concerns a contract of
loan, and not a fiduciary transaction between a lawyer and his client. However,
after the IBP found out his duplicity and referred the case back to this Court, and
after the complainant submitted his Affidavit of Desistance, respondent still has the
temerity to say that it would be prudent for the Honorable Court, if the same will
also be referred to the IBP for appropriate action x x x.
 
Respondent is making a mockery of the proceedings as well as of the authority of
the IBP and the Court. After claiming that the IBP has no jurisdiction over the
complaint, he now alleges that it would be prudent for this Court to refer back the
case as well as the complainants affidavit of desistance to the IBP.
 
In Lemoine v. Balon, Jr., respondent was found guilty of grave misconduct for
misappropriating the funds of his client. In the instant case, respondent committed
the same reprehensible act. In addition, he continued to represent himself as a
lawyer despite his prior disbarment, and committed contumacious acts before the
IBP and the Court. Such utter disregard of this Courts authority must not be
countenanced.
 
It has been held that contempt of court is a defiance of the authority, justice or
dignity of the court, such conduct as tends to bring the authority and administration
of the law into disrespect.[10] It signifies not only a willful disregard or
disobedience of the courts order but such conduct as tends to bring the authority of
the court and the administration of law into disrepute or in some manner to impede
the due administration of justice.[11]
 
Section 3, Rule 71 of the Rules of Court provides that a person may be punished
for indirect contempt for:
 
xxxx
 
(c) Any abuse of or any unlawful interference with the processes or
proceedings of a court not constituting direct contempt under section 1
of this Rule;
 
(d) Any improper conduct tending, directly or indirectly, to impede,
obstruct, or degrade the administration of justice;
 
(e) Assuming to be an attorney or an officer of a court, and acting as
such without authority;
 
xxxx
 
The same Rule further provides that a person may be punished for indirect
contempt after a charge in writing has been filed, and an opportunity given to the
respondent to comment thereon and to be heard by himself or counsel. In the
instant case, respondent was ordered to show cause why he should not be cited for
contempt for not disclosing his prior disbarment and for continuing to represent
himself as a lawyer. He submitted an explanation but we find the same
unsatisfactory.
 
Thus, respondent was properly accorded his right to due process. The essence of
due process is to be found in the reasonable opportunity to be heard and submit any
evidence one may have in support of ones defense. To be heard does not only
mean verbal arguments in court; one may be heard also through pleadings. Where
opportunity to be heard, either through oral arguments or pleadings, is accorded,
there is no denial of procedural due process.[12]
 
A person adjudged guilty of indirect contempt may be punished by a fine not
exceeding P30,000.00 or imprisonment not exceeding six months, or both.
[13]
 Under the circumstances prevailing in the instant case, we find the fine in the
maximum amount of P30,000.00 as appropriate.
 
ACCORDINGLY, respondent Amadeo E. Balon, Jr. is found guilty
of INDIRECT CONTEMPT and is ordered to pay a FINE of P30,000.00 payable
in full within a non-extendible period of five days from receipt of this Resolution,
and strongly warned to refrain from any further attempts to make a mockery of
judicial processes and that commission of the same or similar act will merit a more
severe sanction. Failure to pay the fine within the given period will subject
respondent to imprisonment until full compliance.
 
SO ORDERED.