FACTS:

This disbarment case arose from a dispute in the University of Sto. Tomas (UST) Faculty Union leadership. Atty. Eduardo J. Mariño Jr., who was the president of the UST Faculty Union, was entrusted with funds meant to be distributed among faculty members of the university. The complaint alleged impropriety and double-dealing in the disbursement of these funds.

In 1986, Atty. Mariño Jr. and other union officers entered into a collective bargaining agreement with UST amounting to P35 million. Disputes arose, and the agreement expired in 1988. UST terminated the employment of sixteen officers and directors of the UST Faculty Union, including Atty. Mariño Jr., in 1989. The Supreme Court later ruled in favor of the dismissed employees, ordering their reinstatement with back wages.

In 1990, a five-year collective bargaining agreement between UST and the UST Faculty Union was prescribed by the Secretary of Labor, retroactive to 1988. In the same year, UST and the union entered into a compromise agreement, agreeing to pay P7,000,000.00. Only P5,000,000.00 was immediately paid, while the remaining balance of P2,000,000.00 was deferred.

In 1992, UST and the UST Faculty Union executed a memorandum of agreement to settle salary increases and benefits under the collective bargaining agreement. UST would directly release a portion of the agreed amount to faculty members, while the union would disburse the remainder. UST relinquished only P18,038,939.37 to the union, falling short by P3,734,839.03. The union placed P9,766,570.01 in the money market, earning P1,146,381.27 in interest. After deducting expenses, the union had a balance of P6,389,154.04, which was distributed among faculty members in 1994.

Complainants, who were members of the UST Faculty Union, filed complaints with the Department of Labor and Employment questioning the lack of transparency in the management and disbursement of the monetary benefits. They filed two complaints against the union officers and directors, seeking their expulsion for allegedly failing to account for the balance of P42,000,000.00 ceded to them by UST and for deducting attorney's fees amounting to P4,200,000.00 from the benefits allotted to faculty members. The complainants also filed a disbarment complaint against Atty. Mariño, accusing him of compromising their entitlements under the collective bargaining agreement without their knowledge or consent, and alleging lack of transparency and refusal to account for the attorney's fees. Atty. Mariño argued that the disbarment complaint constituted forum-shopping, as it raised the same issues as the labor complaints. The disbarment complaint was then referred to the Integrated Bar of the Philippines (IBP) for investigation, and the IBP Commissioner recommended the suspension of Atty. Mariño until he submitted a detailed accounting of the remittances. The case was referred back to the IBP for a more detailed investigation. In the meantime, the Regional Director ordered the expulsion of Atty. Mariño and the other union officers and directors, but this order was set aside by the Bureau of Labor Relations, which found that the balance of P42,000,000.00 had been fully accounted for.

ISSUES:

1. Whether or not there are ethical lapses on the part of Atty. Marino in securing the funds through a compromise agreement and obtaining attorney's fees.

2. Whether or not Atty. Marino was in conflict of interest when he negotiated for the compromise agreement and obtained the attorney's fees.

3. Whether respondent Atty. Mariño failed to disclose his interest and conflict of interest in the compromise agreement.

4. Whether respondent Atty. Mariño failed to disclose his interest and conflict of interest in obtaining attorney's fees.

5. Whether or not Atty. Eduardo J. Mariño Jr. should be sanctioned for his misconduct.

RULING:

1. The Court found that there were ethical lapses on the part of Atty. Marino in securing the funds through a compromise agreement and obtaining attorney's fees without full prior disclosure to the UST Faculty Union.

2. The Court held that Atty. Marino was in conflict of interest when he negotiated for the compromise agreement and obtained the attorney's fees acting as union president, union attorney, and an interested party seeking his own restitution.

3. The Court ruled in favor of the complainants and found respondent Atty. Mariño guilty of violating Canon 15 of the Code of Professional Responsibility, which requires lawyers to observe candor, fairness, and loyalty in their dealings with clients. The Court found that Atty. Mariño failed to disclose crucial information about the manner by which he secured the funds through the compromise agreement and attorney's fees. The lack of transparency on Atty. Mariño's part deprived the faculty members of the bargaining unit of the information needed to make an informed decision and protect their own interests. The Court emphasized that lawyers have a duty to comply with the oath of office and the canons of professional ethics, especially during these critical times when the practice of law is being scrutinized. The Court further stated that a lawyer's vocation is not a simple business proposition, but a serious matter of public interest.

4. Atty. Eduardo J. Mariño Jr. is reprimanded for his misconduct with a warning that a more drastic punishment will be imposed upon a repetition of the same act.

PRINCIPLES:

• Conflict of interest: The test of conflict of interest among lawyers 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.

• Disabled from acquiring for own benefit: An attorney or any other person occupying fiduciary relations is disabled from acquiring for his own benefit the property committed to his custody for management.

• Lawyer's financial stakes in the subject matter: A lawyer is not authorized to have financial stakes in the subject matter of a suit brought in behalf of his client.

• Duty of loyalty: A lawyer, as both lawyer and president of a union, is duty-bound to protect and advance the interests of union members and the bargaining unit above his own.

• Lawyers have a duty to observe candor, fairness, and loyalty in their dealings with clients (Canon 15, Code of Professional Responsibility).

• Lawyers are expected to prioritize service-oriented conscience over self-interest.

• Attorneys must comply strictly with the oath of office and the canons of professional ethics, especially during times when the practice of law is being criticized.

• Lawyers have a duty to be open and candid with their clients, ensuring that they are provided with sufficient information to make informed decisions.

• The objective of a disciplinary case is not to punish the individual attorney but to protect the dispensation of justice by sheltering the judiciary and the public from the misconduct or inefficiency of officers of the court.

• Restorative justice, not retribution, is the goal in disciplinary proceedings.

• A reprimand and a warning may be sufficient disciplinary action depending on the circumstances of the case.

• Attorneys should refrain from all appearances and acts of impropriety, including circumstances indicating conflict of interests.

• Attorneys should behave at all times with circumspection and dedication befitting a member of the Bar, especially observing candor, fairness, and loyalty in all transactions with their clients.