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Conflict of interest of a lawyer hired by a law firm, C3S15 CPRA

Section 15, Canon III

SECTION 15. Conflict of interest of a lawyer hired by a law firm. – When a lawyer joins a law firm, it shall be the duty of the lawyer to disclose to the law firm, at the earliest possible opportunity, his or her previous clients that may have a potential conflict of interest with the current clients of the law firm. If there is a potential conflict of interest, the lawyer shall not act on the case or cases of the affected current client. (2023 Code of Professional Responsibility and Accountability or CPRA)

1. Conflict of interest of a lawyer hired by a law firm

a. Duty to disclose

At the earliest possible opportunity, when joining a law firm, lawyers are duty-bound to disclose to the law firm, their “previous clients that may have a potential conflict of interest with the current clients of the law firm.”

The obligation is that of an active disclosure, which means that said lawyers should make the disclosure without need of prodding, instructions, or orders.

There is conflict of interest when a lawyer represents inconsistent interests of two or more opposing parties. The test is “whether or not in behalf of one client, it is the lawyer’s duty to fight for an issue or claim, but it is his duty to oppose it for the other client. In brief, if he argues for one client, this argument will be opposed by him when he argues for the other client.” This rule covers not only cases in which confidential communications have been confided, but also those in which no confidence has been bestowed or will be used. Also, there is conflict of interests if the acceptance of the new retainer will require the attorney to perform an act which will injuriously affect his first client in any matter in which he represents him and also whether he will be called upon in his new relation to use against his first client any knowledge acquired through their connection. Another test of the inconsistency of interests is whether the acceptance of a new relation will prevent an attorney from the full discharge of his duty of undivided fidelity and loyalty to his client or invite suspicion of unfaithfulness or double dealing in the performance thereof. (Villamor v. Jumao-As, En Banc, A.C. No. 8111, December 09, 2020, Per Hernando, J.)

Gonzales v. Cabucana, A.C. No. 6836, January 23, 2006, Per Austria-Martinez, J.:

• On January 8, 2004, Gonzales filed a petition before the Integrated Bar of the Philippines (IBP) alleging that: she was the complainant in a case for sum of money and damages filed before the Municipal Trial Court in Cities (MTCC) of Santiago City, docketed as Civil Case No. 1-567 where she was represented by the law firm CABUCANA, CABUCANA, DE GUZMAN AND CABUCANA LAW OFFICE, with Atty. Edmar Cabucana handling the case and herein respondent as an associate/partner; on February 26, 2001, a decision was rendered in the civil case ordering the losing party to pay Gonzales the amount of P17,310.00 with interest and P6,000.00 as attorney’s fees; Sheriff Romeo Gatcheco, failed to fully implement the writ of execution issued in connection with the judgment which prompted Gonzales to file a complaint against the said sheriff with this Court; in September 2003, Sheriff Gatcheco and his wife went to the house of Gonzales; they harassed Gonzales and asked her to execute an affidavit of desistance regarding her complaint before this Court; Gonzales thereafter filed against the Gatchecos criminal cases for trespass, grave threats, grave oral defamation, simple coercion and unjust vexation; notwithstanding the pendency of Civil Case No. 1-567, where respondent’s law firm was still representing Gonzales, herein respondent represented the Gatchecos in the cases filed by Gonzales against the said spouses; respondent should be disbarred from the practice of law since respondent’s acceptance of the cases of the Gatchecos violates the lawyer-client relationship between complainant and respondent’s law firm and renders respondent liable under the [old CPR].

• In his Answer, respondent averred: He never appeared and represented complainant in Civil Case No. 1-567 since it was his brother, Atty. Edmar Cabucana who appeared and represented Gonzales in said case. He admitted that he is representing Sheriff Gatcheco and his wife in the cases filed against them but claimed that his appearance is pro bono and that the spouses pleaded with him as no other counsel was willing to take their case. He entered his appearance in good faith and opted to represent the spouses rather than leave them defenseless. When the Gatchecos asked for his assistance, the spouses said that the cases filed against them by Gonzales were merely instigated by a high ranking official who wanted to get even with them for their refusal to testify in favor of the said official in another case. At first, respondent declined to serve as counsel of the spouses as he too did not want to incur the ire of the high-ranking official, but after realizing that he would be abdicating a sworn duty to delay no man for money or malice, respondent entered his appearance as defense counsel of the spouses free of any charge. Not long after, the present complaint was crafted against respondent which shows that respondent is now the subject of a ‘demolition job.’ The civil case filed by Gonzales where respondent’s brother served as counsel is different and distinct from the criminal cases filed by complainant against the Gatcheco spouses, thus, he did not violate any canon on legal ethics.

• The claim of respondent that there is no conflict of interests in this case, as the civil case handled by their law firm where Gonzales is the complainant and the criminal cases filed by Gonzales against the Gatcheco spouses are not related, has no merit. The representation of opposing clients in said cases, though unrelated, constitutes conflict of interests or, at the very least, invites suspicion of double-dealing which this Court cannot allow.

• Respondent further argued that it was his brother who represented Gonzales in the civil case and not him, thus, there could be no conflict of interests. We do not agree. As respondent admitted, it was their law firm which represented Gonzales in the civil case. Such being the case, the rule against representing conflicting interests applies.

b. No participation in case of conflict of interest

Lawyers are prohibited from acting on cases of the affected current clients if there is indeed a potential conflict of interest.

References

Canon III, 2023 Code of Professional Responsibility

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