FACTS:

Complainants, who are siblings and heirs of Arcadia Nicodemus, hired respondent Atty. Pedro C. Pujalte, Jr. as their counsel in a civil case to compel their sister to deliver their shares in their deceased mother's estate. The trial court rendered a decision in favor of the sister and ordered the Branch Clerk of Court to withdraw a certain amount from the bank and deliver it to all the heirs. In the presence of the defendant and respondent counsel, the Branch Clerk of Court divided the amount and handed the remaining balance to the respondent, who claimed to be authorized to receive the money and oversee its distribution to the complainants. However, the complainants did not receive their shares and demanded the money from the respondent. The respondent eventually delivered a lesser amount, claiming that part of it was his attorney's fees. The complainants engaged the services of another lawyer and filed a complaint for disbarment and/or disciplinary action against the respondent for violating Canon 16 of the Code of Professional Responsibility. The Integrated Bar of the Philippines (IBP) found the respondent guilty of violating Canon 16 and recommended his suspension. The IBP Board of Governors adopted and approved the recommendation. The Supreme Court upheld the decision and suspended the respondent from the practice of law for one year. The Court emphasized that lawyers should hold in trust all money and properties of their clients and must promptly deliver them when due or upon demand. The respondent had no right to unilaterally withhold a portion of the money as attorney's fees without an agreement with the complainants. His failure to return the money and his conduct violated the trust reposed on him and tainted his integrity as a member of the Bar.

ISSUES:

1. Whether Atty. Pedro C. Pujalte, Jr. violated Canon 16 of the Code of Professional Responsibility.

2. Whether Atty. Pedro C. Pujalte, Jr. should be suspended from the practice of law.

RULING:

1. Atty. Pedro C. Pujalte, Jr. is found guilty of violating Canon 16 of the Code of Professional Responsibility. He is suspended from the practice of law for a period of one (1) year. He is also ordered to return the sum of P236,000.00 to the complainants within five (5) days.

PRINCIPLES:

• A lawyer must hold in trust all moneys and properties of the client that may come into his possession. (Canon 16 of the Code of Professional Responsibility)

• A lawyer is required to deliver the funds and property of the client when due or upon demand, but may retain a lien over the funds to satisfy lawful fees and disbursements, provided that timely notice is given to the client. (Rule 16.03 of the Code of Professional Responsibility)

• A lawyer cannot unilaterally appropriate the money of a client for payment of attorney's fees without the client's consent. (Cabigao vs. Rodrigo, 57 Phil 20; Capulong vs. Alino, 22 SCRA 491)

• The failure of a lawyer to promptly return the money of the client upon demand may give rise to the presumption that the lawyer misappropriated it in violation of the trust reposed on him. (Canon 16 of the Code of Professional Responsibility)

• Membership in the legal profession is a privilege, and lawyers are expected at all times to uphold the integrity and dignity of the legal profession. Any act or omission that lessens the trust and confidence reposed by the public in the fidelity, honesty, and integrity of the legal profession may warrant disciplinary action.