Cordon Case
Transcript of Cordon Case
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EN BANC
[A.C. No. 2797. October 4, 2002]
ROSAURA P. CORDON, complainant, vs.
JESUS BALICANTA,respondent.
R E S O L U T I O N
PER CURIAM
On August 21, 1985, herein complainant Rosaura Cordon filed
ith this Court a complaint for dis!arment, doc"eted as
Administrati#e Case No$ 2%9%, against Att&$ 'esus Balicanta$ After
respondents comment to the complaint and complainants repl&
thereto, this Court, on (arch 29, 1995 referred the matter to the
)ntegrated Bar of the *hilippines +)B*, for !re#it& for
in#estigation, report and recommendation ithin 9- da&s from
notice$ Commissioner .eorge Briones of the )B* Commission on
Bar /iscipline as initiall& tas"ed to in#estigate the
case$ Commissioner Briones as later on replaced !&
Commissioner Renato Cunanan$ Complainant filed a supplementalcomplaint hich as dul& admitted and, as agreed upon, the
parties filed their respecti#e position papers$
Based on her complaint, supplemental complaint, repl& and
position paper, the complainant alleged the folloing facts0
hen her hus!and eli3!erto C$ 'aldon died, herein complainant
Rosaura Cordon and her daughter Rosemarie inherited the
properties left !& the said decedent$ All in all, complainant andher daughter inherited 21 parcels of land located in 4am!oanga
Cit&$ he la&er ho helped her settle the estate of her late
hus!and as respondent 'esus Balicanta$
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6ometime in the earl& part of 1981, respondent enticed
complainant and her daughter to organi7e a corporation that
ould de#elop the said real properties into a highscale
commercial comple3 ith a !eautiful penthouse for
complainant$ Rel&ing on these apparentl& sincere proposals,complainant and her daughter assigned 19 parcels of land to
Rosaura Enterprises, )ncorporated, a nel&formed and dul&
registered corporation in hich the& assumed maorit&
onership$ he su!ect parcels of land ere then registered in
the name of the corporation$
hereafter, respondent singlehandedl& ran the affairs of the
corporation in his capacit& as Chairman of the Board, *resident,
.eneral (anager and reasurer$ he respondent also made
complainant sign a document hich turned out to !e a #oting
trust agreement$Respondent li"eise succeeded in ma"ing
complainant sign a special poer of attorne& to sell and mortgage
some of the parcels of land she inherited from her deceased
hus!and$6he later disco#ered that respondent transferred the
titles of the properties to a certain ion 6u& Ong ho !ecame the
ne registered oner thereof$ Respondent ne#er accounted for
the proceeds of said transfers$
)n 1981, respondent, using a spurious !oard resolution,
contracted a loan from the :and Ban" of the *hilippines +:B*, for
!re#it& in the amount of o (illion o ;undred ent& *esos
+*2,22-,--- using as collateral 9 of the real properties that the
complainant and her daughter contri!uted to the corporation$ he
respondent ostensi!l& intended to use the mone& to construct the
Baliasan Commercial Center +BCC, for !re#it&$ Complainant
later on found out that the structure as made of poor materials
such as sawali, coco lum!er and !am!oo hich could not ha#e
cost the corporation an&thing close to the amount of the loan
secured$
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or four &ears from the time the de!t as contracted, respondent
failed to pa& e#en a single installment$ As a result, the :B*, in a
letter dated (a& 22, 1985, informed respondent that the past due
amorti7ations and interest had alread& accumulated to 6e#en
;undred ent&nine housand i#e ;undred hree *esos andent&fi#e Centa#os +*%29,5-<$25$ he :B* made a demand on
respondent for pa&ment for the tenth time$ (eanhile, hen the
BCC commenced its operations, respondent started to earn
re#enues from the rentals of BCCs tenants$ On Octo!er 28, 198%,
the :B* foreclosed on the 9 mortgaged properties due to non
pa&ment of the loan$
Respondent did not e3ert an& effort to redeem the foreclosed
properties$ orse, he sold the corporations right to redeem the
mortgaged properties to a certain ;adi (ahmud 'ammang
through a fa"e !oard resolution dated 'anuar& 1=, 1989 hich
clothed himself ith the authorit& to do so$ Complainant and her
daughter, the maorit& stoc"holders, ere ne#er informed of the
alleged meeting held on that date$ Again, respondent ne#er
accounted for the proceeds of the sale of the right to
redeem$ Respondent also sold to 'ammang a parcel of land
!elonging to complainant and her daughter hich as contiguousto the foreclosed properties and e#idenced !& ransfer Certificate
of itle No$ >28-%$ ;e ne#er accounted for the proceeds of the
sale$
6ometime in 198<, complainants daughter, Rosemarie, disco#ered
that their ancestral home had !een demolished and that her
mother, herein complainant, as !eing detained in a small nipa
shac" in a place called Culianan$ hrough the help of Att&$ :inda
:im, Rosemarie as a!le to locate her mother$ Rosemarie later
learned that respondent too" complainant aa& from her house
on the prete3t that said ancestral home as going to !e
remodeled and painted$ But respondent demolished the ancestral
home and sold the lot to ion 6u& Ong, using another spurious
!oard resolution designated as Board Resolution No$ 1, series of
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1992$ he resolution contained the minutes of an alleged
organi7ational meeting of the directors of the corporation and as
signed !& Ale3ander ee, Angel ernando, Erin ernando and
.a!riel 6oli#ar$ Complainant and her daughter did not "no ho
these persons !ecame stoc"holders and directors of thecorporation$ Respondent again did not account for the proceeds of
the sale$
Complainant and her daughter made se#eral demands on
respondent for the deli#er& of the real properties the& allegedl&
assigned to the corporation, for an accounting of the proceeds of
the :B* loan and as ell as the properties sold, and for the
rentals earned !& BCC$ But the demands remained
unheeded$ ;ence, complainant and her daughter, in a letter dated
'une =, 1985, terminated the ser#ices of respondent as their
la&er and repeated their demands for accounting and turno#er
of the corporate funds, and the return of the 19 titles that
respondent transferred to the corporation$ he& also threatened
him ith legal action in a letter dated August <, 1985$
6oon after, complainant found out from the 6ecurities and
E3change Commission +6EC, for !re#it& that RosauraEnterprises, )nc$, due to respondents refusal and neglect, failed to
su!mit the corporations annual financial statements for 1981,
1982 and 198<? 6EC .eneral )nformation 6heets for 1982, 198<
and 198=? (inutes of Annual (eetings for 1982, 198< and 198=?
and (inutes of Annual (eetings of /irectors for 1982, 198< and
198=$
Complainant also disco#ered that respondent collected rental
pa&ments from the tenants of BCC and issued handrittenreceipts hich he signed, not as an officer of the corporation !ut
as the attorne&atla of complainant$ Respondent also used the
tennis court of BCC to dr& his pala& and did not "eep the
!uildings in a satisfactor& state, so much so that the di#isions
ere losing pl&ood and other materials to thie#es$
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Complainant li"eise accused respondent of circulating rumors
among her friends and relati#es that she had !ecome insane to
pre#ent them from !elie#ing hate#er complainant
said$ According to complainant, respondent proposed that she
legall& separate from her present hus!and so that the latterould not inherit from her and that respondent !e adopted as her
son$
or his defense, respondent, in his comment and position paper,
denied emplo&ing deceit and machination in con#incing
complainant and her daughter to assign their real properties to
the corporation? that the& freel& and #oluntar& e3ecuted the
deeds of assignment and the #oting trust agreement that the&
signed? that he did not singlehandedl& manage the corporation
as e#idenced !& certifications of the officers and directors of the
corporation? that he did not use spurious !oard resolutions
authori7ing him to contract a loan or sell the properties assigned
!& the complainant and her daughter? that complainant and her
daughter should !e the ones ho should render an accounting of
the records and re#enues inasmuch as, since 198= up to the
present, the parttime corporate !oo""eeper, ith the
conni#ance of the complainant and her daughter, had custod& of the corporate records? that complainant and her daughter
sa!otaged the operation of BCC hen the& illegall& too" control of
it in 198>? that he ne#er poc"eted an& of the proceeds of the
properties contri!uted !& the complainant and her daughter? that
the demolition of the ancestral home folloed legal procedures?
that complainant as ne#er detained in Culianan !ut she freel&
and #oluntaril& li#ed ith the famil& of *-< 'oel Constantino as
e#idenced !& complainants on letter den&ing she as"idnapped? and that the instant dis!arment case should !e
dismissed for !eing premature, considering the pendenc& of cases
!efore the 6EC and the Regional rial Court of 4am!oanga
in#ol#ing him and complainant$
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$ Respondent claims in his Comment, his Anser and his *osition
*aper that on April =, 1981 he as elected as Chairman and
/irector and on April 5, 1981 he as elected *resident of the
corporation$Respondents on Anne3es mar"ed as . and .1 of
his Comment sho that on April =, 1981 he as not onl& electedas Chairman and /irector as he claims !ut as /irector, Board
Chairman and *resident$ he purported minutes as onl& signed
!& respondent and an acting 6ecretar& !& the name of icente
(aalac$
6aid Anne3 does not sho ho as elected reasurer$
Respondents Anne3 ; and ;1 shos that in the alleged
organi7ational meeting of the directors on April 5, 1981 a certainarnacio Buco& as elected reasurer$ Buco&s name does not
appear as an incorporator nor a stoc"holder an&here in the
documents su!mitted$
he purported minutes of the organi7ational meeting of the
directors as signed onl& !& respondent Balicanta and a
6ecretar& named erisimo (artin$
.$ 6ince respondent as elected as /irector, Chairman and
*resident on April =, 1981 as respondents on Anne3es . to .1
ould sho, then complainants claim that respondent as
li"eise acting as reasurer of to corporations !ear truth and
credence as respondent signed and accepted the titles to 19
parcels of land ceded !& the complainant and her daughter, as
reasurer on April 5, 1981 after he as alread& purportedl&
elected as Chairman, *resident and /irector$
;$ Respondent misleads the Commission into !elie#ing that all
the directors signed the minutes mar"ed as E3hi!it ; to ;1 !&
stating that the same as dul& signed !& all the Board of
/irectors hen the document itself shos that onl& he and one
erisimo (artin signed the same$
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;e also claims that all the stoc"holders signed the minutes of
organi7ational meeting mar"ed as Anne3es . and .1 of his
Comment &et the same shos that onl& the acting Chairman and
acting 6ecretar& signed$
)$ Respondent claims that the Board or its representati#e as
authori7ed !& the stoc"holders comprising 2D< of the outstanding
capital stoc", as reuired !& la, to mortgage the parcels of land
!elonging to the corporation, hich ere all assigned to the
corporation !& complainant and her daughter, !& #irtue of Anne3
) and )10 attached to his Comment$
he su!ect attachment hoe#er re#eals that onl& the folloing
persons signed their conformit& to the said resolution0 respondentBalicanta ho oned 1-9 shares, icente (aalac +1 share,
/aihan .raciano +1 share$
Complainants ho collecti#el& held a total of 1,%11 shares out of
the 1,%5- outstanding capital stoc" of the corporation ere not
represented in the purported stoc"holders meeting authori7ing
the mortgage of the su!ect properties$
he 2D< #ote reuired !& la as therefore not complied ith &et
respondent proceeded to mortgage the su!ect 9 parcels of land
!& the corporation$
'$ Respondent further relies on Anne3 ' of his Comment,
purportedl& the minutes of a special meeting of the Board of
/irectors authori7ing him to o!tain a loan and mortgage the
properties of the corporation dated August 29, 1981$ his claim is
!aseless$ he reuired ratification of 2D< !& the stoc"holders of records as not met$ Again, respondent attempts to mislead the
Commission and Court$
F$ urther, the constitution of the Board is du!ious$ he alleged
minutes of the organi7ational meeting of the stoc"holders electing
the mem!ers of the Board, ha#e not !een dul& signed !& the
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stoc"holders as shon in respondents anne3 . hich as
purportedl& the organi7ational meeting of the stoc"holders$
:$ Also, Anne3 ' of respondents Comment hich purportedl&
authori7ed him to o!tain a loan and to mortgage the 9 parcels of land as onl& signed !& himself and a secretar&$
($ )n said Anne3 G'G of respondents Comment he stated that
complainant Rosaura Cordon as on lea#e !& #irtue of a #oting
trust agreement allegedl& e3ecuted !& complainant in his fa#or
co#ering all her shares of stoc"$ he claim is !aseless$ he #oting
trust referred to !& respondent +anne3 / of his Comment, e#en
if it ere assumed to !e #alid, co#ered onl& 2>> shares of
complainants &et she oned a total of 1,-<9 shares after she andher daughter ceded in fa#or of the corporation 19 parcels of land$
Being a former la&er to complainant, respondent should ha#e
ensured that her interest as safeguarded$ Het, complainant as
apparentl& and deli!eratel& left our +sic on the prete3t that, she
had e3ecuted a #oting trust agreement in fa#or of respondent$
)t is suspicious that complainant as made to sign a #oting trust
agreement on 21 August 1981 and immediatel& thereafter, the
resolutions authori7ing respondent to o!tain a loan and to
mortgage the 9 parcels of land ere passed and appro#ed$
N$ )t is also highl& irregular for respondent ho is a la&er, to
allo a situation to happen here, ith the e3clusion of
complainant as director the result as that there remained onl& =
mem!ers of the Board,$
O. Re!"o#$e#t! o%# "&e'$(#)! !*b+(tte$ to te
Co++(!!(o# co#tr'$(ct e'c oter.
1$ or instance, hile in his Comment respondent /EN)E6 that he
emplo&ed deceit and machination in con#incing the complainant
and her daughter to sign the articles of incorporation of Rosaura
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Enterprises and in ceding to the corporation 19 parcels of land in
4am!oanga Cit&, !ecause the& freel&, intelligentl& and #oluntaril&
signed the same, &et, in his *osition *aper, respondent too"
another stance$
)n paragraphs 1$1 and 1$2 of his *osition *aper hich as
su!mitted 12 &ears later, respondent claimed that it as actuall&
the idea of Att&$ Rosaura :$ Al#are7 that a corporation !e put up
to incorporate the estate of the late eli3!erto /$ 'aldon$
2$ :i"eise, respondent claimed that complainant and her
daughter ere not directors, hence the& ere not notified of
meetings, in paragraph 2> +c of his Comment he !lamed the
other stoc"holders and directors for the corporations ina!ilit& tocompl& ith the :and Ban"s demands sa&ing that the& ha#e
consistentl& failed since 1982 to con#ene +1$ for the annual
stoc"holders meetings and +i$i for the monthl& !oard meeting$
;is on pleadings claim that he had !een the ChairmanD*resident
since 1981 to the present$ )f +sic so, it as his dut& to con#ene
the stoc"holders and the directors for meetings$
Respondent appeared a!le to con#ene the stoc"holders and
directors hen he needed to ma"e a loan of p2$2 million? hen
he sold the corporations right of redemption o#er the foreclosed
properties of the corporation to 'ammang, hen he sold one
parcel of land co#ered !& C >2,8-% to 'ammang in addition to
the 9 parcels of land hich ere foreclosed, and hen he sold the
complainants ancestral home co#ered !& C No$ %2,--=$
)t is thus strange h& respondent claims that the corporationcould not do an&thing to sa#e the corporations properties from
!eing foreclosed !ecause the stoc"holders and directors did not
con#ene$
his assertion of respondent is clearl& e#ident of dishonest,
deceitful and immoral conduct especiall& !ecause, in all his acts
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constituting con#e&ances of corporate propert&, respondent used
minutes of stoc"holders and directors meetings signed onl& !&
him and a secretar& or signed !& him and persons ho ere not
incorporators much less stoc"holders$
)t is orth& of note that in respondents E3hi!its 15, 1>, 1% and
18 of his position paper, there ere % ne stoc"holders and
complainant appeared to ha#e onl& 2>> shares to her name hile
her daughter Rosemarie had no shares at all$ Respondent did not
present an& proof of con#e&ance of shares !& complainant and
her daughter$
)t is further orth noting that complainants #oting trust +anne3 /
of respondents Comment here she allegedl& entrusted 2>>shares to respondent on August 21, 1981 had onl& a #alidit& of 5
&ears$ hus, she should ha#e had her entire holdings of 1,28<
shares !ac" in her name in August 198>$
Respondents purported minutes of stoc"holders meeting +E3hs$
15 and 1% do not reflect this$
here as no e3planation hatsoe#er from respondent on ho
complainant and her daughter lost their 9% control holding in
the corporation$
<$ As a further contradiction in respondents pleadings, e note
that in paragraph 2$%$C of his Comment he said that onl&
recentl&, this &ear, 1985, the complainant and her aforenamed
daughter e3amined said #oluminous supporting
receiptsDdocuments hich had pre#iousl& !een e3amined !& the
:and Ban" for loan releases, during hich occasion respondentsuggested to them that the corporation ill ha#e to hire a full
time !oo""eeper to put in order said #oluminous supporting
receiptsDdocuments, to hich the& ad#ersel& reacted due to lac"
of corporate mone& to pa& for said !oo""eeper$ But in
respondents *osition *aper par$ >$< he stated that0
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A#-%'-, (t (! #ot te re!"o#$e#t b*t r'ter te
co+"&'(#'#t %o !o*&$ re#$er ' $et'(&e$ 'cco*#t(#) to
te cor"or't(o# o te cor"or'te recor$! '! %e&& '!
cor"or'te re/e#*e!(#co+e "rec(!e&- bec'*!e !(#ce
1994 to te "re!e#t
'3. Te cor"or'te "'rtt(+e boo55ee"er E$(&berto
Be#e$(cto, %(t te (#$(!"e#!'b&e co##(/'#ce '#$
(#!t()'t(o# o te co+"&'(#'#t '#$ er $'*)ter, '+o#)
oter!, '! c*!to$- o te cor"or'te recor$!, 666
=$ )n other contradictor& stance, respondent claims in par$ %$< of
his position paper that complainant and her daughter sa!otaged
the BCC operations of the corporation !& illegall& ta"ing o#eractual control and super#ision thereof sometime in 198>, 333
Het respondents on e3hi!its in his position paper particularl&
E3hi!it 15 and 1> here the su!ect of the foreclosed properties
of the corporation comprising the Baliasan Commercial Center
+BCC as ta"en up, complainant and her daughter ere not
e#en present nor ere the& the su!ect of the discussion, !el&ing
respondents claim that the complainant and her daughter illegall&too" actual control of BCC$
5$ On the matter of the receipts issued !& respondent e#idencing
pa&ment to him of rentals !& lessees of the corporation, attached
to the complaint as Anne3es ; to ;1%, respondent claims that
the receipts are temporar& in nature and that su!seuentl&
regular corporate receipts ere issued$ On their face hoe#er the
receipts clearl& appear to !e official receipts, printed and
num!ered dul& signed !& the respondent !earing his printedname$
)t is difficult to !elie#e that a la&er of respondent stature ould
issue official receipts to lessees if he onl& meant to issue
temporar& ones$
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>$ ith regard to respondents claim that the complainant
consented to the sale of her ancestral home, co#ered !& C No$
%2,--= to one ion 6u& Ong for hich he attached as E3hi!it 22
to his *osition *aper the minutes of an annual meeting of the
stoc"holders, it !ehoo#es this Commission h& complainantssignature had to !e accompanied !& her thum!
mar"$ urthermore, complainants signature appears unsta!le and
sha"&$ his Office is thus persuaded to !elie#e complainants
allegation in paragraph <! of her position paper that
since Se"te+ber 1992 *" to 'rc 1998 !e %'! be(#)
$et'(#e$ b- o#e PO !(c3 Joe& Co#!t'#t(#o '#$ (! %(e
*#$er (#!tr*ct(o#! ro+ re!"o#$e#t B'&(c'#t'.
his conclusion is supported !& a letter from respondent dated
(arch 199<, Anne3 ; of complainants position paper, here
respondent ordered *olice Officer Constantino to allo Att&$ :inda
:im and Rosemarie 'aldon to tal" to ita Rosing$
he complainants thum! mar" together ith her #isi!l& unsta!le
sha"& signature lends credence to her claim that she as
detained in the far flung !arrio of Culianan under instructions of
respondent hile her ancestral home as demolished and the lotsold to one ion 6u& Ong$
)t appears that respondent felt compelled to o#erensure
complainants consent !& getting her to affi3 her thum! mar" in
addition to her signature$
%$ Respondent li"eise denies that he also acted as Corporate
6ecretar& in addition to !eing the Chairman, *resident and
reasurer of the corporation$ Het, respondent su!mitted to thiscommission documents hich are supported to !e in the
possession of the Corporate 6ecretar& such as the stoc" and
transfer !oo" and minutes of meetings$
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he foregoing findings of this Commission are #irtual smo"ing
guns that pro#e on no uncertain terms that respondent, ho as
the legal counsel of complainant in the latter part of the
settlement of the estate of her deceased hus!and, committed
unlaful, immoral and deceitful conduct proscri!ed !& Rule 1$-1of the code of professional responsi!ilit&$
:i"eise, respondent clearl& committed a #iolation of Canon 15 of
the same code hich pro#ides that A la&er should o!ser#e
candor fairness and lo&alt& in all his dealings and transactions
ith his client$
Respondents acts gra#el& diminish the pu!lics respect for the
integrit& of the profession of la for hich this Commissionrecommends that he !e meted the penalt& of dis!arment$
he pendenc& of the cases at the 6EC and the Regional rial
Court of 4am!oanga filed !& complainant against respondent
does not preclude a determination of respondents culpa!ilit& as a
la&er$
his Commission cannot further dela& the resolution of this
complaint filed in 1985 !& complainant, and old ido ho
deser#es to find hope and reco#er her confidence in the udicial
s&stem$
he findings of this office, predominantl& !ased on documents
adduced !& !oth parties lead to onl& one rather unpalata!le
conclusion$ hat respondent Att&$ 'esus $ Balicanta, in his
professional relations ith herein complainant did in fact emplo&
unlaful, dishonest, and immoral conduct proscri!ed in nouncertain terms !& Rule 1$-1 of the Code of *rofessional
Responsi!ilit&$ )n addition, respondents actions clearl& #iolated
Canon 15 to 1> of the same Code$
)t is therefore our unpleasant dut& to recommend that
respondent, ha#ing committed acts in #iolation of the Canons of
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*rofessional Responsi!ilit&, there!& causing a great disser#ice to
the profession, !e meted the ultimate sanction of dis!arment$@2
On 6eptem!er <-, 1999, hile Commissioner Cunanans
recommendation for respondents dis!arment as pending re#ie!efore E3ecuti#e ice*resident and Northern :u7on .o#ernor
eofilo *ilando, respondent filed a motion reuesting for a full
!lon in#estigation and for in#alidation of the entire proceedings
andDor remedial action under 6ection 11, Rule 1<9B, Re#ised
Rules of Court, alleging that he had e#idence that Commissioner
Cunanans report as drafted !& the la&ers of complainant,
Att&s$ Antonio Cope and Rita :inda 'imeno$ ;e presented to
unsigned anon&mous letters allegedl& coming from a disgruntled
emplo&ee of Att&s$ Cope and 'imeno$ ;e claimed to ha#e recei#ed
these letters in his mail!o3$@<
Respondents motion alleging that Att&s$ Antonio Cope and Rita
:inda 'imeno drafted Commissioner Cunanans report as
accompanied !& a complaint pra&ing for the dis!arment of said
la&ers including Commissioner Cunanan$ he complaint as
doc"eted as CB/ Case No$ 99>58$ After Att&s$ Cope and 'imeno
and Commissioner Cunanan filed their ansers, a hearing asconducted !& the )n#estigating Committee of the )B* Board of
.o#ernors$
On (a& 2>, 2--1, the )B* Board of .o#ernors issued a
resolution@= dismissing for lac" of merit the complaint for
dis!arment against Att&s$ Cope and 'imeno and Commissioner
Cunanan$ And in Adm$ Case No$ 2%9%, the Board adopted and
appro#ed the report and recommendation of Commissioner
Cunanan, and meted against herein respondent Balicanta thepenalt& of suspension from the practice of la for 5 &ears for
commission of acts of misconduct and dislo&alt& !& ta"ing undue
and unfair ad#antage of his legal "noledge as a la&er to gain
material !enefit for himself at the e3pense of complainant
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Rosaura *$ 'aldonCordon and caused serious damage to the
complainant$@5
o support its decision, the Board unco#ered respondents
fraudulent acts in the #er& same documents he presented toe3onerate himself$ )t also too" note of respondents contradictor&
and irreconcila!le statements in the pleadings and position papers
he su!mitted$ ;oe#er, it regarded the penalt& of dis!arment as
too se#ere for respondents misdeeds, considering that the same
ere his first offense$@>
*ursuant to 6ection 12 +!, Rule 1<9B of the Rules of Court,@% the said resolution in Administrati#e Case No$ 2%9% imposing
the penalt& of suspension for 5 &ears on respondent asautomaticall& ele#ated to this Court for final action$ On the other
hand, the dismissal of the complaint for dis!arment against Att&s$
Cope and 'imeno and Commissioner Cunanan, doc"eted as CB/
Case No$ 99>58, !ecame final in the a!sence of an& petition for
re#ie$
his Court confirms the dul& supported findings of the )B* Board
that respondent committed condemna!le acts of deceit againsthis client$ he fraudulent acts he carried out against his client
folloed a ell thought of plan to misappropriate the corporate
properties and funds entrusted to him$ At the #er& outset, he
em!ar"ed on his de#ious scheme !& ma"ing himself the
*resident, Chairman of the Board, /irector and reasurer of the
corporation, although he "ne he as prohi!ited from assuming
the position of *resident and reasurer at the same time$@8 As
reasurer, he accepted in !ehalf of the corporation the 19 titles
that complainant and her daughter cooned$ he other treasurerappointed, arnacio Buco&, did not appear to !e a stoc"holder or
director in the corporate records$ he minutes of the meetings
supposedl& electing him and Buco& as officers of the corporation
actuall& !ore the signatures of respondent and the secretar& onl&,
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contrar& to his claim that the& ere signed !& the directors and
stoc"holders$
;e li"eise misled the )B* in#estigating commission in claiming
that the mortgage of 9 of the properties of the corporationpre#iousl& !elonging to complainant and her daughter as
ratified !& the stoc"holders oning tothirds or >% of the
outstanding capital stoc" hen in fact onl& three stoc"holders
oning 111 out of 1,%5- outstanding shares or >$< assented
thereto$ he alleged authori7ation granting him the poer to
contract the :B* loan for o (illion o ;undred ent& *esos
+*2,22-,--- as also not appro#ed !& the reuired minimum of
tothirds of the outstanding capital stoc" despite respondents
claim to the contrar&$ )n all these transactions, complainant and
her daughter ho !oth oned 1,%11 out of the 1,%5- outstanding
shares of the corporation or 9%$% ne#er had an& participation$
Neither ere the& informed thereof$
Clearl&, there as no uorum for a #alid meeting for the
discussion and appro#al of these transactions$
Respondent cannot ta"e refuge in the contested #oting trustagreement supposedl& e3ecuted !& complainant and her
daughter for the reason that it authori7ed respondent to
represent complainant for onl& 2>> shares$
Aside from the dishonest transactions he entered into under the
cloa" of sham resolutions, he failed to e3plain se#eral
discrepancies in his #ersion of the facts$ e here!& reiterate
some of these statements noted !& Commissioner Cunanan in his
findings$
First, respondent !lamed the directors and the stoc"holders ho
failed to con#ene for the reuired annual meetings since
1982$ ;oe#er, respondent appeared a!le to con#ene the
stoc"holders and directors hen he contracted the :B* de!t,
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hen he sold to 'ammang the corporations right of redemption
o#er the foreclosed properties of the corporation, hen he sold
one parcel of land co#ered !& C No$ >28-% to 'ammang, hen
he mortgaged the 9 parcels of land to :B* hich later foreclosed
on said mortgage, and hen he sold the complainants ancestralhome co#ered !& C No$ %2--=$
Second, the factual findings of the in#estigating commission,
affirmed !& the )B* Board, disclosed that complainant and her
daughter on 1,%11 out of 1,%5- shares of the outstanding
capital stoc" of the corporation, !ased on the Articles of
)ncorporation and deeds of transfer of the properties$ But
respondents e#idence shoed that complainant had onl& 2>>
shares of stoc" in the corporation hile her daughter had none,
notithstanding the fact that there as nothing to indicate that
complainant and her daughter e#er con#e&ed their shares to
others$
Respondent li"eise did not e3plain h& he did not return the
certificates representing the 2>> shares after the lapse of 5 &ears
from the time the #oting trust certificate as e3ecuted in 1981$@9
he records sho that up to no, the complainant and her
daughter on 9% of the outstanding shares !ut respondent
ne#er !othered to e3plain h& the& ere ne#er as"ed to
participate in or h& the& ere ne#er informed of important
corporate decisions$
Third, respondent, in his comment, alleged that due to the
o!ection of complainant and her daughter to his proposal to hire
an accountant, the corporation had no formal accounting of itsre#enues and income$ ;oe#er, respondents position paper
maintained that there as no accounting !ecause the parttime
!oo""eeper of the corporation conni#ed ith complainant and her
daughter in "eeping the corporate records$
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Fourth, respondents claim that complainant and her daughter
too" control of the operations of the corporation in 198> is !elied
!& the fact that complainant and her daughter ere not e#en
present in the alleged meeting of the !oard +hich too" place
after 198> to discuss the foreclosure of the mortgagedproperties$ he truth is that he ne#er informed them of such
meeting and he ne#er ga#e control of the corporation to them$
Fifth, Commissioner Cunanan found that0
5$ on the matter of the receipts issued !& respondent e#idencing
pa&ment to him of rentals !& lessees of the corporation, attached
to the complaint as Anne3es ; to ;1%, respondent claims that
the receipts are temporar& in nature and that su!seuentl®ular corporate receipts ere issued$ On their face hoe#er the
receipts clearl& appear to !e official receipts, printed and
num!ered dul& signed !& the respondent !earing his printed
name$
)t is difficult to !elie#e that a la&er of respondents stature ould
issue official receipts to lessees if he onl& meant to issue
temporar& ones$
@1-
Sixth, respondent denies that he acted as Corporate 6ecretar&
aside from !eing the Chairman, *resident and reasurer of the
corporation$ Het respondent su!mitted to the in#estigating
commission documents hich ere supposed to !e in the official
possession of the Corporate 6ecretar& alone such as the stoc"
and transfer !oo" and minutes of meetings$
Seventh, he alleged in his comment that he as the one hoproposed the esta!lishment of the corporation that ould in#est
the properties of the complainant !ut, in his position paper, he
said that it as a certain Att&$ Rosauro Al#are7 ho made the
proposal to put up the corporation$
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After a thorough re#ie of the records, e find that respondent
committed gra#e and serious misconduct that casts dishonor on
the legal profession$ ;is misdemeanors re#eal a deceitful scheme
to use the corporation as a means to con#ert for his on personal
!enefit properties left to him in trust !& complainant and herdaughter$
Not e#en his de#iousness could co#er up the rongdoings he
committed$ he documents he thought could e3culpate him ere
the #er& same documents that re#ealed his immoral and
shameless a&s$ hese documents ere e3tremel& re#ealing in
that the& unmas"ed a man ho "ne the la and a!used it for
his personal gain ithout an& ualms of conscience$ he& painted
an intricate e! of lies, deceit and opportunism !eneath a
carefull& crafted smo"escreen of corporate maneu#ers$
he Code of *rofessional Responsi!ilit& mandates upon each
la&er, as his dut& to societ&, the o!ligation to o!e& the las of
the land and promote respect for la and legal processes$
6pecificall&, he is for!idden to engage in unlaful, dishonest,
immoral or deceitful conduct$@11 )f the practice of la is to remain
an honora!le profession and attain its !asic ideal, those enrolledin its ran"s should not onl& master its tenets and principles !ut
should also, in their li#es, accord continuing fidelit& to them$@12 hus, the reuirement of good moral character is of much
greater import, as far as the general pu!lic is concerned, than the
possession of legal learning$@1< :a&ers are e3pected to a!ide !&
the tenets of moralit&, not onl& upon admission to the Bar !ut
also throughout their legal career, in order to maintain ones good
standing in that e3clusi#e and honored fraternit&$@1= .ood moral
character is more than ust the a!sence of !ad character$ 6uch
character e3presses itself in the ill to do the unpleasant thing if
it is right and the resol#e not to do the pleasant thing if it is
rong$@15 his must !e so !ecause #ast interests are committed
to his care? he is the recipient of un!ounded trust and
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confidence? he deals ith his clients propert&, reputation, his life,
his all$@1>
)ndeed, the ords of former *residing 'ustice of the Court of
Appeals *ompe&o /ia7 cannot find a more rele#ant applicationthan in this case0
here are men in an& societ& ho are so selfser#ing that the& tr&
to ma"e la ser#e their selfish ends$ )n this group of men, the
most dangerous is the man of the la ho has no conscience$ ;e
has, in the arsenal of his "noledge, the #er& tools !& hich he
can poison and disrupt societ& and !ring it to an igno!le end$@1%
.ood moral standing is manifested in the dut& of the la&er tohold in trust all mone&s and properties of his client that ma&
come into his possession$@18 ;e is !ound to account for all mone&
or propert& collected or recei#ed for or from the client$@19 he
relation !eteen an attorne& and his client is highl& fiduciar& in
nature$ hus, la&ers are !ound to promptl& account for mone&
or propert& recei#ed !& them on !ehalf of their clients and failure
to do so constitutes professional misconduct$@2-
his Court holds that respondent cannot in#o"e the separate
personalit& of the corporation to a!sol#e him from e3ercising
these duties o#er the properties turned o#er to him !&
complainant$ ;e !latantl& used the corporate #eil to defeat his
fiduciar& o!ligation to his client, the complainant$ oleration of
such fraudulent conduct as ne#er the reason for the creation of
said corporate fiction$
he massi#e fraud perpetrated !& respondent on the complainantlea#es us no choice !ut to set aside the #eil of corporate
entit&$ or purposes of this action therefore, the properties
registered in the name of the corporation should still !e
considered as properties of complainant and her daughter$ he
respondent merel& held them in trust for complainant +no an
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ailing 8<&earold and her daughter$ he properties con#e&ed
fraudulentl& andDor ithout the reuisite authorit& should !e
deemed as ne#er to ha#e !een transferred, sold or mortgaged at
all$ Respondent shall !e lia!le, in his personal capacit&, to third
parties ho ma& ha#e contracted ith him in good faith$
Based on the aforementioned findings, this Court !elie#es that
the gra#it& of respondents offenses cannot !e adeuatel&
matched !& mere suspension as recommended !& the
)B*$ )nstead, his rongdoings deser#e the se#ere penalt& of
dis!arment, ithout preudice to his criminal and ci#il lia!ilities
for his dishonest acts$
:;ERE<ORE, respondent Attorne& 'esus $ Balicanta is here!&/)6BARRE/$ he Cler" of Court is directed to stri"e out his name
from the Roll of Attorne&s$