UNIVERSITY OF THE PHILIPPINES COLLEGE OF LAW LAW 120
E2024 Prof. Jardeleza
PAULINA T. YU v. ATTY. BERLIN R. DELA CRUZ
AC. No. 10912 – January 19, 2016
EN BANC | Ponente
CANON 16.04 - Rule 16.04 - A lawyer shall not borrow money from his client unless the client's interest are fully protected
by the nature of the case or by independent advice. Neither shall a lawyer lend money to a client except, when in the interest
of justice, he has to advance necessary expenses in a legal matter he is handling for the client.
FACTS OF THE CASE:
• Dela Cruz agreed to be Yu’s Lawyer for 3 cases.
• Nov. 29, 2011, while the lawyer-client relationship was subsisting, Dela Cruz borrowed pieces of jewelry from Yu and
pledged the same with the Citystate Savings Bank, Inc. for P29,945.50.
• To redeem the jewelry, Dela Cruz gave Yu a Citystate Savings Bank Check but was dishonored because the account
was closed.
• March 2012: Yu sent a demand letter to Dela Cruz or the refund of the acceptance fees received by respondent lawyer
prior to the "abandonment" of the cases and the payment of the value of the jewelry. → no response
o A BP 22 criminal case was later filed by Yu against Dela Cruz.
• June 2012 → A verified complaint is filed with the IBP for the disbarment of Dela Cruz on account of grave misconduct,
conduct unbecoming of a lawyer and commission of acts in violation of the lawyer's oath.
• Despite being served notice, he did not file an answer. → Likewise he did not appear for the scheduled hearing. →
Again he failed to appear on the rescheduled date (Notice was received by his mother).
• IBP Investigating Commissioner recommended disbarment for violation of Canon 16.04 → Affirmed by the Board of
Governors → Elevated to SC because the IBP’s ruing is recommendatory only.
ISSUES & RATIOS
W/N Atty. Dela Cruz is guilty of violating CANON 16.04 – YES
• Dela Cruz his client's property, (valuable pieces of jewelry) which he presented as security in a contract of pledge.
o Yu voluntarily delivered her jewelry worth P135K to Dela Cruz who meant to borrow it and pawn it thereafter. This
act alone shows respondent lawyer's blatant disregard of Rule 16.04.
• He used his client's jewelry in order to obtain, and then appropriate for himself, the proceeds from the pledge. In so
doing, he had abused the trust and confidence reposed upon him by his client. That he might have intended to
subsequently pay his client the value of the jewelry is inconsequential. → The mere act of Borrowing from a client
is what is punished.
• It has repeatedly been emphasized that the relationship between a lawyer and his client is one imbued with trust and
confidence. And as true as any natural tendency goes, this "trust and confidence" is prone to abuse.
o The rule against borrowing of money by a lawyer from his client is intended to prevent the lawyer from taking
advantage of his influence over his client. It presumes the client is disadvantaged by the lawyer's ability to use all
the legal maneuverings to renege on his obligation.
• Court finds it proper to impose the penalty of three-year suspension against respondent lawyer, with a stern warning
that a repetition of any of the infractions attributed to him in this case, or any similar act, shall merit a heavier penalty.
• Acceptance fee is not Lawyer’s fees. → Acceptance fee does not measure the extent of the actual legal service provided.
→ Yu failed to present any evidence showing that respondent lawyer committed abandonment or neglect of duty in
handling of cases. Hence, the Court sees no legal basis for the return of the subject acceptance fees.
RULING: WHEREFORE, finding Atty. Dela Cruz GUILTY of violating Canons 1, 16, 17, and Rules 1.01 and 16.04 of
the CPR, the Court hereby SUSPENDS him for THREE YEARS with a STERN WARNING
