THIRD DIVISION
|
EVANGELINA MASMUD (as
substitute complainant for ALEXANDER J. MASMUD), Petitioner, - versus - NATIONAL LABOR RELATIONS
COMMISSION (First Division) and ATTY. ROLANDO B. GO, JR., Respondents. |
G.R.
No. 183385
Present: YNARES-SANTIAGO, J.,
Chairperson, AUSTRIA-MARTINEZ, CHICO-NAZARIO, NACHURA, and PERALTA, JJ. Promulgated: February
13, 2009 |
x------------------------------------------------------------------------------------x
RESOLUTION
NACHURA, J.:
Before
the Court is a petition for review on certiorari[1]
assailing the Decision[2]
dated October 31, 2007 and the Resolution dated June 6, 2008 of the Court of
Appeals (CA) in CA-G.R. SP No. 96279.
The
facts of the case are as follows:
On
July 9, 2003, Evangelina Masmud’s (Evangelina) husband, the late Alexander J.
Masmud (Alexander), filed a complaint[3]
against First Victory Shipping Services and Angelakos (Hellas) S.A. for
non-payment of permanent disability benefits, medical expenses, sickness
allowance, moral and exemplary damages, and attorney’s fees. Alexander engaged
the services of Atty. Rolando B. Go, Jr. (Atty. Go) as his counsel.
In
consideration of Atty. Go’s legal services, Alexander agreed to pay attorney’s
fees on a contingent basis, as follows: twenty percent (20%) of total monetary
claims as settled or paid and an additional ten percent (10%) in case of
appeal. It was likewise agreed that any award of attorney’s fees shall pertain
to respondent’s law firm as compensation.
On
November 21, 2003, the Labor Arbiter (LA) rendered a Decision granting the
monetary claims of Alexander. The dispositive portion of the decision, as
quoted in the CA Decision, reads:
WHEREFORE, foregoing considered,
judgment is rendered finding the [First Victory Shipping Services and Angelakos
(Hellas) S.A.] jointly and severally liable to pay [Alexander’s] total
permanent disability benefits in the amount of US$60,000.00 and his sickness
allowance of US$2,348.00, both in Philippine currency at the prevailing rate of
exchange at the time of payment; and to pay further the amount of P200,000.00
as moral damages, P100,000.00 as exemplary damages and attorney’s fees equivalent to ten
percent (10%) of the total monetary award.
[Alexander’s] claim for payment of medical expenses is dismissed for lack of basis.
SO ORDERED.[4]
Alexander’s
employer filed an appeal before the National Labor Relations Commission (NLRC).
During the pendency of the proceedings before the NLRC, Alexander died. After
explaining the terms of the lawyer’s fees to Evangelina, Atty. Go caused her
substitution as complainant. On April 30, 2004, the NLRC rendered a Decision
dismissing the appeal of Alexander’s employer. The employer subsequently filed
a motion for reconsideration. The NLRC denied the same in an Order dated
October 26, 2004.
On
appeal before the CA, the decision of the LA was affirmed with modification.
The award of moral and exemplary damages was deleted.[5]
Alexander’s employers filed a petition for certiorari[6] before this Court. On February 6, 2006,
the Court issued a Resolution dismissing the case for lack of merit.
Eventually,
the decision of the NLRC became final and executory. Atty. Go moved for the
execution of the NLRC decision, which was later granted by the LA. The surety
bond of the employer was garnished. Upon motion of Atty. Go, the surety company
delivered to the NLRC Cashier, through the NLRC Sheriff, the check amounting to
P3,454,079.20. Thereafter, Atty. Go moved for the release of the said
amount to Evangelina.
On
January 10, 2005, the LA directed the NLRC Cashier to release the amount of P3,454,079.20
to Evangelina. Out of the said amount,
Evangelina paid Atty. Go the sum of P680,000.00.
Dissatisfied, Atty. Go filed a motion to record and enforce
the attorney’s lien alleging that Evangelina reneged on their contingent fee
agreement. Evangelina paid only the amount of P680,000.00, equivalent to
20% of the award as attorney’s fees, thus,
leaving a balance of 10%, plus the award pertaining to the counsel as attorney’s
fees.
In
response to the motion filed by Atty. Go, Evangelina filed a comment with
motion to release the amount deposited with the NLRC Cashier. In her comment,
Evangelina manifested that Atty. Go’s claim for attorney’s fees of 40% of the
total monetary award was null and void based on Article 111 of the Labor Code.
On
February 14, 2005, the LA issued an Order[7]
granting Atty. Go’s motion, the fallo
of which reads:
WHEREFORE,
premises considered, and further considering the substitute complainant’s
initial payment of 20% to movant-counsel of the monetary claims as paid, let
the balance or unpaid twenty (20%) per cent of attorney’s fees due
movant-counsel (or the amount of P839,587.39) be recorded as lien upon
all the monies that may still be paid to substitute complainant Evangelina
Masmud.
Accordingly, the NLRC Cashier is
directed to pay movant-counsel the amount of P677,589.96 which is
currently deposited therein to partially satisfy the lien.
SO ORDERED.[8]
Evangelina questioned the February 14, 2005 Order of the LA before
the NLRC. On January 31, 2006, the NLRC issued a Resolution[9]
dismissing the appeal for lack of merit.
Evangelina
then elevated the case to the CA via a
petition for certiorari.[10] On October 31, 2007, the CA rendered a
Decision[11]
partially granting the petition. The dispositive portion of the decision reads:
WHEREFORE, the petition is PARTIALLY GRANTED. The Resolutions dated January 31, 2006 and July 18, 2006
are hereby AFFIRMED with MODIFICATION
in that the Attorney’s fees of respondent Atty. Rolando B. Go, Jr. is declared
fully compensated by the amount of P1,347,950.11 that he has already
received.
SO
ORDERED.[12]
Evangelina
filed a motion for reconsideration. However, on June 6, 2008, the CA issued a
Resolution[13] denying
the motion for reconsideration for lack of merit.
Hence,
the instant petition.
Evangelina
presented this issue, viz.:
THE
COURT OF APPEALS COMMITTED SERIOUS AND REVERSIBLE ERROR OF LAW IN ITS DECISION
DATED 31 OCTOBER 2007 AND RESOLUTION DATED 6 JUNE 2008 INSOFAR AS IT UPHOLDS
RESPONDENT LAWYER’S CLAIM OF FORTY PERCENT (40%) OF THE MONETARY AWARD IN A
LABOR CASE AS ATTORNEY’S FEES.[14]
In
effect, petitioner seeks affirmance of her conviction that the legal
compensation of a lawyer in a labor proceeding should be based on Article 111
of the Labor Code.
There
are two concepts of attorney's fees. In the ordinary sense, attorney's fees
represent the reasonable compensation paid to a lawyer by his client for the
legal services rendered to the latter. On the other hand, in its extraordinary
concept, attorney's fees may be awarded by the court as indemnity for damages
to be paid by the losing party to the prevailing party,[15] such
that, in any of the cases provided by law where such award can be made, e.g., those authorized in Article 2208
of the Civil Code, the amount is payable not to the lawyer but to the client, unless they have agreed that the award
shall pertain to the lawyer as additional compensation or as part thereof.[16]
Here,
we apply the ordinary concept of attorney’s fees, or the compensation that
Atty. Go is entitled to receive for representing Evangelina, in substitution of
her husband, before the labor tribunals and before the court.
Evangelina
maintains that Article 111 of the Labor Code is the law that should govern
Atty. Go’s compensation as her counsel and assiduously opposes their agreed
retainer contract.
Article
111 of the said Code provides:
ART. 111. Attorney's fees. — (a) In cases of unlawful withholding of wages the culpable party may be assessed attorney's fees equivalent to ten percent of the amount of the wages recovered.
Contrary
to Evangelina’s proposition, Article 111 of the Labor Code deals with the extraordinary
concept of attorney’s fees. It regulates the amount recoverable as attorney's
fees in the nature of damages sustained by and awarded to the prevailing party.
It may not be used as the standard in fixing the amount payable to the lawyer
by his client for the legal services he rendered.[17]
In
this regard, Section 24, Rule 138 of the Rules of Court should be observed in
determining Atty. Go’s compensation. The said Rule provides:
SEC. 24. Compensation
of attorney's; 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 therefor unless found by the court
to be unconscionable or unreasonable.[18]
The
retainer contract between Atty. Go and Evangelina provides for a contingent
fee. The contract shall control in the determination of the amount to be paid,
unless found by the court to be unconscionable or unreasonable.[19]
Attorney's fees are unconscionable if they affront one's sense of justice,
decency or reasonableness.[20]
The decree of unconscionability or unreasonableness of a stipulated amount in a
contingent fee contract will not preclude recovery. It merely justifies the
fixing by the court of a reasonable compensation for the lawyer's services.[21]
The
criteria found in the Code of Professional Responsibility are also to be
considered in assessing the proper amount of compensation that a lawyer should
receive. Canon 20, Rule 20.01 of the said Code provides:
CANON 20 — A LAWYER SHALL CHARGE ONLY FAIR AND REASONABLE FEES.
Rule 20.01. — A lawyer shall be guided by the following factors in determining his fees:
(a) The time spent and the extent of the services rendered or required;
(b) The novelty and difficulty of the question involved;
(c) The importance of the subject matter;
(d) The skill demanded;
(e) The probability of losing other employment as a result of acceptance of the proffered case;
(f) The customary charges for similar services and the schedule of fees of the IBP Chapter to which he belongs;
(g) The amount involved in the controversy and the benefits resulting to the client from the service;
(h) The contingency or certainty of compensation;
(i) The character of the employment, whether occasional or established; and
(j) The professional standing of the lawyer.
Contingent
fee contracts are subject to the supervision and close scrutiny of the court in
order that clients may be protected from unjust charges.[22]
The amount of contingent fees agreed upon by the parties is subject to the
stipulation that counsel will be paid for his legal services only if the suit
or litigation prospers. A much higher compensation is allowed as contingent
fees because of the risk that the lawyer may get nothing if the suit fails.[23]
The Court finds nothing illegal in the contingent fee contract between Atty. Go
and Evangelina’s husband. The CA committed no error of law when it awarded the
attorney’s fees of Atty. Go and allowed him to receive an equivalent of 39% of
the monetary award.
The issue of the reasonableness of attorney's fees is a
question of fact. Well-settled is the rule that conclusions and findings of
fact of the CA are entitled to great weight on appeal and will not be disturbed
except for strong and cogent reasons which are absent in the case at bench. The
findings of the CA, which are supported by substantial evidence, are almost
beyond the power of review by the Supreme Court.[24]
Considering
that Atty. Go successfully represented his client, it is only proper that he should
receive adequate compensation for his efforts. Even as we agree with the
reduction of the award of attorney's fees by the CA, the fact that a lawyer
plays a vital role in the administration of justice emphasizes 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 of fraud on the part of his client
as the client is against abuse on the part of his counsel. The duty of the
court is not alone to ensure that a lawyer acts in a proper and lawful manner,
but also to see that a lawyer is paid his just fees. With his capital
consisting 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.[25]
WHEREFORE, in view of the foregoing,
the Decision dated October 31, 2007 and the Resolution dated June 6, 2008 of
the Court of Appeals in CA-G.R. SP No. 96279 are hereby AFFIRMED.
SO ORDERED.
ANTONIO
EDUARDO B. NACHURA
Associate
Justice
WE CONCUR:
CONSUELO YNARES-SANTIAGO
Associate
Justice
Chairperson
|
MA. ALICIA
AUSTRIA-MARTINEZ Associate Justice |
MINITA V. CHICO-NAZARIO Associate Justice |
DIOSDADO M.
PERALTA
Associate Justice
A T T E S T A T I O N
I attest that the
conclusions in the above Resolution were reached in consultation before the
case was assigned to the writer of the opinion of the Court’s Division.
CONSUELO
YNARES-SANTIAGO
Associate
Justice
Chairperson,
Third Division
C E R T I F I C A T I O
N
Pursuant to Section 13, Article
VIII of the Constitution and the Division Chairperson's Attestation, I certify
that the conclusions in the above Resolution had been reached in consultation
before the case was assigned to the writer of the opinion of the Court’s
Division.
REYNATO
S. PUNO
Chief
Justice
[1] RULES OF COURT, Rule 45.
[2] Penned by Associate Justice Portia Aliño-Hormachuelos, with Associate Justices Lucas P. Bersamin and Estela M. Perlas-Bernabe, concurring; rollo, pp. 16-28.
[3] Entitled, “Alexander J. Masmud, substituted by Evangelina R. Masmud v. First
Victory Shipping Services and Angelakos (Hellas)
[4] Rollo, p. 18.
[5] The case was docketed as CA-G.R. SP No. 88009.
[6] RULES OF COURT, Rule 65.
[7] Penned by Labor Arbiter Cresencio G. Ramos, Jr.; rollo, pp. 40-43.
[8]
[9] Rollo, pp. 31-37.
[10] RULES OF COURT, Rule 65.
[11] Supra note 2.
[12] Rollo, p. 27.
[13]
[14]
[15] Bach v. Ongkiko Kalaw Manhit & Acorda Law Offices, G.R. No. 160334, September 11, 2006, 501 SCRA 419, 426.
[16] Traders Royal Bank Employees Union-Independent v. NLRC, 336 Phil. 705, 712 (1997).
[17] Traders Royal Bank Employees Union-Independent v. NLRC, 336 Phil. 705, 724 (1997).
[18] Emphasis supplied.
[19] Rayos v. Hernandez, G.R. No. 169079, February 12, 2007, 515 SCRA 517, 530-531.
[20] Roxas v. De Zuzuarregui, Jr., G.R. Nos.
152072 & 152104, January 31, 2006, 481 SCRA 258, 279.
[21] Rayos v. Hernandez, G.R. No. 169079, February 12, 2007, 515 SCRA 517, 530.
[22]
[23] Sesbreño v. Court of Appeals, 314 Phil. 884, 893 (1995).
[24] The
following are the exceptions to the rule that the findings of facts of the CA
are deemed conclusive:
(1) When the conclusion is a finding
grounded entirely on speculation, surmises and conjectures;
(2)
When
the inference made is manifestly mistaken, absurd or impossible;
(3)
Where
there is a grave abuse of discretion;
(4)
When
the judgment is based on a misapprehension of facts;
(5)
When
the findings of fact are conflicting;
(6)
When
the Court of Appeals, in making its findings, went beyond the issues of the
case and the same is contrary to the admissions of both appellant and appellee;
(7)
When
the findings are contrary to those of the trial court;
(8)
When
the findings of fact are conclusions without citation of specific evidence on
which they are based;
(9)
When
the facts set forth in the petition as well as in the petitioners’ main and
reply briefs are not disputed by the respondents; and
(10) When the findings of fact of the Court of
Appeals are premised on the supposed absence of evidence and contradicted by
the evidence on record. (Aklan College,
Inc. v. Perpetuo Enero, Arlyn
Castigador, Nuena Sermon and Jocelyn Zolina, G.R. No. 178309, January 27,
2009.)
[25] Bach v. Ongkiko Kalaw Manhit & Acorda Law Offices, G.R. No. 160334, September 11, 2006, 501 SCRA 419, 434.