2004 / Mar
G.R. No. 155311 DOY MERCANTILE, INC., PETITIONER, VS. AMA COMPUTER COLLEGE AND ERNESTO RIOVEROS, RESPONDENTS. March 31, 2004
SECOND DIVISION
[ G.R. No. 155311, March 31, 2004 ]
DOY MERCANTILE, INC., PETITIONER, VS. AMA COMPUTER COLLEGE AND ERNESTO RIOVEROS, RESPONDENTS.
R E S O L U T I O N
TINGA, J,:
On June 1, 1990, petitioner Doy Mercantile, Inc. (DOY) through its then counsel, respondent Atty. Eduardo P. Gabriel, Jr., filed before the Regional Trial Court (RTC) of Cebu City a Complaint forAnnulment of Contract, Damages with Preliminary Injunctionagainst AMA Computer College, Inc. (AMA) and one Ernesto Rioveros.
Petitioner alleged that it owns Lots 2-A and 2-B, and the improvements thereon, located at No. 640 Osmeña Boulevard, Cebu City, covered by Transfer Certificate of Title (TCT) Nos. 68951 and 68952. DOY assailed theDeed of Conditional Salesupposedly executed by one of DOY’s directors, Dionisio O. Yap, in favor of AMA. Dionisio allegedly sold the properties to AMA without proper authorization from DOY’s Board of Directors. DOY also questioned the Secretary’s Certificate which was executed by DOY Corporate Secretary Francisco P. Yap, authorizing Dionisio to sell the properties and to sign the contract in behalf of DOY.
Through Atty. Gabriel, Jr., DOY filed anUrgent Ex Parte Motion for the Issuance of a Restraining Order, which was granted by the RTC on June 14, 1990. On June 23, 1990, Atty. Gabriel also filed an Answer toDefendant’s Counterclaim. On July 2, 1990, he filed DOY’sFormal Rejoinder to AMA’s Opposition for Issuance of Writ of Preliminary Injunction. He also filed on July 24, 1990, anOmnibus Motionseeking (1) the reconsideration of the order denying DOY’s application for a writ of preliminary injunction, (2) the setting of the case for pre-trial and trial on the merits, and (3) the imposition of disciplinary sanctions to Atty. Winston Garcia, who notarized theDeed of Conditional Saleand theSecretary’s Certificate. On August 31, 1990, Atty. Gabriel also filed aRejoinder to AMA’s Opposition to Motion for Reconsideration, etc.
During this period, that is, before pre-trial, DOY filed aPetition for Certiorari, Prohibition with a Prayer for a Writ of Preliminary Injunction(CA-G.R. S.P. No. 22727) with the Court of Appeals. It questioned theOrderof the RTC dated July 5, 1990, denying DOY’s prayer for the issuance of a writ of preliminary injunction and dissolving the temporary restraining order previously issued. DOY also assailed theOrderdated August 10, 1990, which denied DOY’sOmnibus Motion. Atty. Gabriel, Jr., signed the petition together with Atty. Enrique C. Andres of the law firm of Salonga, Andres, Hernandez and Allado.
During pre-trial, AMA proposed to enter into a compromise agreement with DOY, which proposal the parties later agreed to adopt. The agreement was signed by Fernando Yap in behalf of DOY, with the assistance of Atty. Gabriel, Jr. and Atty. Andres. On November 29, 1990, aJudgmentbased on the compromise agreement was rendered by the RTC. In light of said compromise, the Court of Appeals dismissed CA-G.R. S.P. No. 22727 for mootness.
DOY, however, refused to satisfy Atty. Gabriel, Jr.’s attorney’s fees, prompting the lawyer to file with the RTC aMotion to Allow Commensurate Fees and to Annotate Attorney’s Lien on T.C.T. Nos. 68951 and 68952. At this point, DOY had already obtained the services of a new counsel to attend to the enforcement of theJudgmentof the RTC.
On December 27, 1991, the RTC fixed Atty. Gabriel, Jr.’s fees at P200,000.00 and ordered that a lien be annotated on the TCTs. AWrit of Executionwas later issued by the trial court in Atty. Gabriel, Jr.’s favor.
Upon Atty. Gabriel Jr.’s motion for reconsideration, the RTC increased his fees to P500,000.00. It then issued anotherWrit of Executionto enforce the new award but denied theMotion to Annotate the Awardat the back of the TCTs.
DOY, for its part, filed several petitions with the Court of Appeals to set aside the RTCOrdersinvolving the award of attorney’s fees. Eventually, the Court of Appeals rendered aDecision,[1]fixing Atty. Gabriel, Jr.’s fees at P200,000.00 and affirming the subsequent Order of the RTC not to annotate such award on the TCTs.
ThisDecisionis now the subject of the present petition.
DOY contends that theDecisionis not consistent with the guidelines prescribed by Section 24, Rule 138[2]of the Rules of Court and Rule 20.01[3]of the Code of Professional Responsibility. DOY avers that except for the statement that the compromise agreement benefited DOY and that Atty. Gabriel, Jr., was a competent lawyer, the Court of Appeals made no pronouncement as to the importance of the subject matter in controversy, the extent of services rendered and the professional standing of Atty. Gabriel, Jr., DOY also submits that the Court of Appeals should not have merely relied on the value of the properties involved as the basis for its award. Furthermore, while Atty. Gabriel admitted that he already received Eighty Two Thousand Nine Hundred Fifty Pesos (P82,950.00) from DOY for incidental and partial attorney’s fees, a fact affirmed by the Court of Appeals, the latter still awarded P200,000.00 to him.
Atty. Gabriel, Jr., comments, however, that the attorney’s fees awarded by the appellate court were commensurate and, perhaps, even less than, the value of the services he rendered. He then enumerates the pleadings he drafted and the appearances he made to dispose of the main case.
Atty. Gabriel, Jr., also alleges that he handled interrelated cases for DOY. He purportedly prepared and filed with the Metropolitan Trial Court of Cebu City the following: a case forIllegal Detainer with Damages, anOpposition to Motion to Dismiss, an Opposition to Defendant’s Motion for Reconsideration, and aMotion to Dismiss.
Atty. Gabriel, Jr., also draws attention to the criminal case filed by Rolando Piedad, director of AMA, before the Office of the Cebu City Prosecutor charging Dionisio Yap and Francisco Yap with estafa through falsification of public document. He claims that it was he who prepared and filed with said Office theJoint Affidavit of Messrs. Dionisio and Francisco Yap against Rolando Piedad for Perjury,as well as theYaps’ Counter-Affidavitin the criminal case. The case was eventually dismissed by the fiscal.
Finally, Atty. Gabriel, Jr., stresses that, through his efforts and resourcefulness, AMA had no choice but to concede to the compromise agreement resulting in the cancellation of theDeed of Conditional Salebetween DOY and AMA. According to him, AMA was operating a school on the property, which did not have an area of at least 1,000 square meters as required of a school campus, in violation of the directives of the Department of Education, Culture and Sports (DECS). AMA also did not have a business permit from the city government. Atty. Gabriel thus made formal representations with the DECS and the City of Cebu, which ordered AMA to cease operations. Atty. Gabriel, Jr., also verified from the Philippine National Bank whether AMA applied for a loan with which to pay DOY as stipulated in theDeed of Conditional Sale, and was informed that AMA’s application was held in abeyance due to its poor credit reputation.
The petition has no merit. It is not accurate for petitioner to state that the Court of Appeals did not take into account the time spent and the extent of the services rendered by Atty. Gabriel Jr. The Court of Appeals found that:
In fixing the award of attorney’s fees, the Court of Appeals also considered the amount involved in the controversy and the benefits resulting to the client from the service in fixing Atty. Gabriel, Jr.’s fees, thus:
Petitioner’s contention that the appellate court should also have taken into account the importance of the subject matter in controversy and the professional standing of counsel in determining the latter’s fees is untenable. Although Rule 138 of the Rules of Court and Rule 20.01 of the Code of Professional Responsibility list several other factors in setting such fees, these are mere guides in ascertaining the real value of the lawyer’s service.[8]Courts are not bound to consider all these factors in fixing attorney’s fees.
While a lawyer should charge only fair and reasonable fees,[9]no hard and fast rule maybe set in the determination of what a reasonable fee is, or what is not. That must be established from the facts in each case.[10]As the Court of Appeals is the final adjudicator of facts, this Court is bound by the former’s findings on the propriety of the amount of attorney’s fees.
ACCORDINGLY, the Court Resolved to DENY thePetitionand AFFIRM theDecisionof the Court of Appeals.
SO ORDERED.
Quisumbing, (Acting Chairman), Austria-Martinez,andCallejo, Sr., JJ.,concur.
Puno, (Chairman), J.,on leave.
[1]In CA-G.R. CV No. 43958.
[2]SEC. 24.Compensation of attorneys; agreement as to fees.- An attorney shall be entitled to have and recover from his client no more than a reasonable compensation for his services, with a view to the importance of the subject matter of the controversy, the extent of the services rendered, and the professional standing of the attorney. No court shall be bound by the opinion of attorneys as expert witnesses as to the proper compensation, but may disregard such testimony and base its conclusion on its own professional knowledge. A written contract for services shall control the amount to be paid therefore unless found by the court to be unconscionable or unreasonable.
[3]Rule 20.01 – A lawyer shall be guided by the following factors in determining his fees:
[5]Id.at 30.
[6]Id.at 31-34.
[7]Id.at 35.
[8]Code of Professional Ethics, §12.
[9]Code of Professional Responsibility, Canon 20.
[10]De Guzman v. Visayan Rapid Transit, Co., Inc., et al., 68 Phil. 643.
Petitioner alleged that it owns Lots 2-A and 2-B, and the improvements thereon, located at No. 640 Osmeña Boulevard, Cebu City, covered by Transfer Certificate of Title (TCT) Nos. 68951 and 68952. DOY assailed theDeed of Conditional Salesupposedly executed by one of DOY’s directors, Dionisio O. Yap, in favor of AMA. Dionisio allegedly sold the properties to AMA without proper authorization from DOY’s Board of Directors. DOY also questioned the Secretary’s Certificate which was executed by DOY Corporate Secretary Francisco P. Yap, authorizing Dionisio to sell the properties and to sign the contract in behalf of DOY.
Through Atty. Gabriel, Jr., DOY filed anUrgent Ex Parte Motion for the Issuance of a Restraining Order, which was granted by the RTC on June 14, 1990. On June 23, 1990, Atty. Gabriel also filed an Answer toDefendant’s Counterclaim. On July 2, 1990, he filed DOY’sFormal Rejoinder to AMA’s Opposition for Issuance of Writ of Preliminary Injunction. He also filed on July 24, 1990, anOmnibus Motionseeking (1) the reconsideration of the order denying DOY’s application for a writ of preliminary injunction, (2) the setting of the case for pre-trial and trial on the merits, and (3) the imposition of disciplinary sanctions to Atty. Winston Garcia, who notarized theDeed of Conditional Saleand theSecretary’s Certificate. On August 31, 1990, Atty. Gabriel also filed aRejoinder to AMA’s Opposition to Motion for Reconsideration, etc.
During this period, that is, before pre-trial, DOY filed aPetition for Certiorari, Prohibition with a Prayer for a Writ of Preliminary Injunction(CA-G.R. S.P. No. 22727) with the Court of Appeals. It questioned theOrderof the RTC dated July 5, 1990, denying DOY’s prayer for the issuance of a writ of preliminary injunction and dissolving the temporary restraining order previously issued. DOY also assailed theOrderdated August 10, 1990, which denied DOY’sOmnibus Motion. Atty. Gabriel, Jr., signed the petition together with Atty. Enrique C. Andres of the law firm of Salonga, Andres, Hernandez and Allado.
During pre-trial, AMA proposed to enter into a compromise agreement with DOY, which proposal the parties later agreed to adopt. The agreement was signed by Fernando Yap in behalf of DOY, with the assistance of Atty. Gabriel, Jr. and Atty. Andres. On November 29, 1990, aJudgmentbased on the compromise agreement was rendered by the RTC. In light of said compromise, the Court of Appeals dismissed CA-G.R. S.P. No. 22727 for mootness.
DOY, however, refused to satisfy Atty. Gabriel, Jr.’s attorney’s fees, prompting the lawyer to file with the RTC aMotion to Allow Commensurate Fees and to Annotate Attorney’s Lien on T.C.T. Nos. 68951 and 68952. At this point, DOY had already obtained the services of a new counsel to attend to the enforcement of theJudgmentof the RTC.
On December 27, 1991, the RTC fixed Atty. Gabriel, Jr.’s fees at P200,000.00 and ordered that a lien be annotated on the TCTs. AWrit of Executionwas later issued by the trial court in Atty. Gabriel, Jr.’s favor.
Upon Atty. Gabriel Jr.’s motion for reconsideration, the RTC increased his fees to P500,000.00. It then issued anotherWrit of Executionto enforce the new award but denied theMotion to Annotate the Awardat the back of the TCTs.
DOY, for its part, filed several petitions with the Court of Appeals to set aside the RTCOrdersinvolving the award of attorney’s fees. Eventually, the Court of Appeals rendered aDecision,[1]fixing Atty. Gabriel, Jr.’s fees at P200,000.00 and affirming the subsequent Order of the RTC not to annotate such award on the TCTs.
ThisDecisionis now the subject of the present petition.
DOY contends that theDecisionis not consistent with the guidelines prescribed by Section 24, Rule 138[2]of the Rules of Court and Rule 20.01[3]of the Code of Professional Responsibility. DOY avers that except for the statement that the compromise agreement benefited DOY and that Atty. Gabriel, Jr., was a competent lawyer, the Court of Appeals made no pronouncement as to the importance of the subject matter in controversy, the extent of services rendered and the professional standing of Atty. Gabriel, Jr., DOY also submits that the Court of Appeals should not have merely relied on the value of the properties involved as the basis for its award. Furthermore, while Atty. Gabriel admitted that he already received Eighty Two Thousand Nine Hundred Fifty Pesos (P82,950.00) from DOY for incidental and partial attorney’s fees, a fact affirmed by the Court of Appeals, the latter still awarded P200,000.00 to him.
Atty. Gabriel, Jr., comments, however, that the attorney’s fees awarded by the appellate court were commensurate and, perhaps, even less than, the value of the services he rendered. He then enumerates the pleadings he drafted and the appearances he made to dispose of the main case.
Atty. Gabriel, Jr., also alleges that he handled interrelated cases for DOY. He purportedly prepared and filed with the Metropolitan Trial Court of Cebu City the following: a case forIllegal Detainer with Damages, anOpposition to Motion to Dismiss, an Opposition to Defendant’s Motion for Reconsideration, and aMotion to Dismiss.
Atty. Gabriel, Jr., also draws attention to the criminal case filed by Rolando Piedad, director of AMA, before the Office of the Cebu City Prosecutor charging Dionisio Yap and Francisco Yap with estafa through falsification of public document. He claims that it was he who prepared and filed with said Office theJoint Affidavit of Messrs. Dionisio and Francisco Yap against Rolando Piedad for Perjury,as well as theYaps’ Counter-Affidavitin the criminal case. The case was eventually dismissed by the fiscal.
Finally, Atty. Gabriel, Jr., stresses that, through his efforts and resourcefulness, AMA had no choice but to concede to the compromise agreement resulting in the cancellation of theDeed of Conditional Salebetween DOY and AMA. According to him, AMA was operating a school on the property, which did not have an area of at least 1,000 square meters as required of a school campus, in violation of the directives of the Department of Education, Culture and Sports (DECS). AMA also did not have a business permit from the city government. Atty. Gabriel thus made formal representations with the DECS and the City of Cebu, which ordered AMA to cease operations. Atty. Gabriel, Jr., also verified from the Philippine National Bank whether AMA applied for a loan with which to pay DOY as stipulated in theDeed of Conditional Sale, and was informed that AMA’s application was held in abeyance due to its poor credit reputation.
The petition has no merit. It is not accurate for petitioner to state that the Court of Appeals did not take into account the time spent and the extent of the services rendered by Atty. Gabriel Jr. The Court of Appeals found that:
That Atty. Gabriel, Jr. was the counsel of DMI [DOY] up to the time the compromise agreement was confirmed by the trial court. He only withdrew his appearance as counsel for co-plaintiffs Fred and Felipe Yap, who were eventually dropped as parties to the case, along with the other individual defendants, as it was held that only DMI was the real-party-in-interest.Indeed, the assailedDecisioneven contains an enumeration of the pleadings filed by counsel in behalf of his client.[5]
It is evident that Atty. Gabriel, Jr. served as co-counsel together with Atty. Enrique C. Andres. DMI was assisted by the former. Evidence of which was the service of a copy of the Judgment Based on Compromise Agreement, including the Decision dated January 30, 1991, which dismissed C.A.-G.R. S.P. No. 22727, on Atty. Gabriel, Jr..
A perusal of the pleadings enumerated by the plaintiff-appellant reveals the competence of Atty. Gabriel, Jr. in handling the case. The degree and extent of service rendered by an attorney for a client is best measured in terms other than the mere number of sheets of paper.[4]
In fixing the award of attorney’s fees, the Court of Appeals also considered the amount involved in the controversy and the benefits resulting to the client from the service in fixing Atty. Gabriel, Jr.’s fees, thus:
…. While it is true that Civil Case No. CEB 9043 was terminated by virtue of a compromise agreement by the parties, this is still to be taken as beneficial to DMI as the dispute was finally resolved without having to resort to a full-blown trial on the merits which often would take time before the light at the end of the tunnel may be seen.The Court of Appeals then ended on this note:
….
DMI also assails the use of the value of the property involved in the litigation to serve as a basis or standard in computing and awarding attorney’s fees. A simple perusal of the provisions of Section 24, Rule 138 of the Revised Rules of Court, as well as Canon 20, Rule 20.01 of the Code of Professional Responsibility, would show that “the value of the property” was not enumerated as one of the factors but instead they used “the importance of the subject matter” as a determinant of the amount of award of attorney’s fees. Nevertheless, the Supreme Court has included as one of the determinants for the reasonableness of the award of attorney’s fees “the value of the property affected by the controversy.” ….
....
The issue of the reasonableness of attorney’s fees based onquantum meruitis a question of fact and well-settled is the rule that conclusions and findings of fact by the lower courts are entitled to great weight on appeal and will not be disturbed except for strong and cogent reasons.
The trial court’s initial award of P2000,00.00 as attorney’s fees of Atty. Gabriel, Jr. is reasonable. On the other hand, the increased award of P500,000.00 cannot be justified, taking into account the recognized parameters ofquantum meruit.[6]
Lastly, we take this occasion to reiterate the fact that while the practice of law is not a business, the attorney plays a vital role in the administration of justice and, hence, the need to secure to him his honorarium lawfully earned as a means to preserve the decorum and respectability of the legal profession. A lawyer is as much entitled to judicial protection against injustice or imposition on the part of his client just as the client can claim protection against abuse on the part of his counsel. The duty of the court is not alone to see that a lawyer acts in a proper and lawful manner, it is also its duty to see that a lawyer is paid his just fees. With his capital consisting only of his brains and with his skill acquired at tremendous cost not only in money but in expenditure of time and energy, he is entitled to the protection of any judicial tribunal against any attempt on the part of his client to escape payment of his just compensation. It would be ironic if, after putting forth the best in him to secure justice for his client, he himself would not get his due.[7]This Court finds no reversible error in the above disquisition.
Petitioner’s contention that the appellate court should also have taken into account the importance of the subject matter in controversy and the professional standing of counsel in determining the latter’s fees is untenable. Although Rule 138 of the Rules of Court and Rule 20.01 of the Code of Professional Responsibility list several other factors in setting such fees, these are mere guides in ascertaining the real value of the lawyer’s service.[8]Courts are not bound to consider all these factors in fixing attorney’s fees.
While a lawyer should charge only fair and reasonable fees,[9]no hard and fast rule maybe set in the determination of what a reasonable fee is, or what is not. That must be established from the facts in each case.[10]As the Court of Appeals is the final adjudicator of facts, this Court is bound by the former’s findings on the propriety of the amount of attorney’s fees.
ACCORDINGLY, the Court Resolved to DENY thePetitionand AFFIRM theDecisionof the Court of Appeals.
SO ORDERED.
Quisumbing, (Acting Chairman), Austria-Martinez,andCallejo, Sr., JJ.,concur.
Puno, (Chairman), J.,on leave.
[1]In CA-G.R. CV No. 43958.
[2]SEC. 24.Compensation of attorneys; agreement as to fees.- An attorney shall be entitled to have and recover from his client no more than a reasonable compensation for his services, with a view to the importance of the subject matter of the controversy, the extent of the services rendered, and the professional standing of the attorney. No court shall be bound by the opinion of attorneys as expert witnesses as to the proper compensation, but may disregard such testimony and base its conclusion on its own professional knowledge. A written contract for services shall control the amount to be paid therefore unless found by the court to be unconscionable or unreasonable.
[3]Rule 20.01 – A lawyer shall be guided by the following factors in determining his fees:
[4]Rollo, pp. 31-32.
a) b) c) d) e) f) g) h) i) j)
[5]Id.at 30.
[6]Id.at 31-34.
[7]Id.at 35.
[8]Code of Professional Ethics, §12.
[9]Code of Professional Responsibility, Canon 20.
[10]De Guzman v. Visayan Rapid Transit, Co., Inc., et al., 68 Phil. 643.