Adelita S. Villamor vs. Atty. Ely Galland A. Jumao-As,
A.C. No. 8111, February 15, 2022
Facts:
1. Villamor alleged that Felipe Retubado and Atty. Jumao-as coaxed her into organizing a lending company. Retubado volunteered to handle the day-to-day operation while Atty. Jumao-as would handle the legal side of the business.
2. True to his word, respondent took care of the registration of the company with the SEC as well as preparation and drafting of some legal documents such as the Articles of Incorporation (AOI).
3. In addition, when the company needed additional funds, Atty. Jumao-as informed Villamor that she could borrow from Debbie Yu. Soon after, Atty. Jumao-as delivered the amount of P500,000.00 to Villamor, which amount was infused into the lending business as additional capital.
4. In May 2008, Atty. Jumao-as and Retubado left Villamor's company and joined Yu's 3E's Debt Equity Grant Co., also a lending company.
5. On October 8, 2008, Atty. Jumao-as sent a demand letter to Villamor, for and in behalf of Yu, demanding payment of P650,000.00 (loan of P500,000.00, with P150,000.00 representing accrued interest).
6. Hence, this complaint.
Issue:
Whether or not respondent represented conflicting interests when he sent her the demand letter in behalf of his new client, Yu.
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Ruling:
Yes. Respondent is guilty of representing conflicting interests.
In determining whether a lawyer is guilty of violating the rules on conflict of interest under the CPR, it is essential to determine whether:
(1) "a lawyer is duty-bound to fight for an issue or claim in behalf of one client and, at the same time, to oppose that claim for the other client;"
(2) "the acceptance of a new relation would prevent the full discharge of a lawyer's duty of undivided fidelity and loyalty to the client or invite suspicion of unfaithfulness or double-dealing in the performance of that duty;" and
(3) "a lawyer would be called upon in the new relation to use against a former client any confidential information acquired through their connection or previous employment."
Thus, to determine whether a conflict of interests exists, it is necessary to first ascertain whether a lawyer-client relationship existed between Villamor and respondent on one hand, and Yu and respondent on the other.
In this case, there can be no denying that a lawyer-client relationship existed between Villamor and respondent despite the absence of any express or written agreement or arrangement as to attorney's fees. Atty. Jumao-as' argument that it was Retubado who engaged his legal services and that his participation was limited only to the incorporation of the lending company, is misplaced. It must be stressed that in the course of the incorporation, respondent directly dealt with Villamor as owner of the company; conversely, Villamor definitely made consultations with respondent on legal matters pertaining to the incorporation and operation of the lending business. In turn, respondent learned of confidential information from Villamor. In fine, a lawyer-client relationship existed between Villamor and respondent. On the other hand, respondent expressly admitted that Yu was also his client.
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