Facts:

The case involves Regino B. Aro as the petitioner against Hon. Arsenio Nanawa, the presiding judge of Branch IV of the Court of First Instance of Laguna, and several private respondents including Luis Magtibay, Pablo Magtibay, Aurelia Martinez, Gregorio Lontok, Maria Mendoza, Maximo Porto, and Rosario Andaya. The events leading to the case began when the Magtibay brothers engaged Aro's services as their attorney on a contingent fee basis to pursue their claim as heirs in the estate of their deceased uncle, Lucio Magtibay. The estate included properties in the possession of the other respondents. Aro filed a petition to litigate as a pauper on behalf of the Magtibay brothers, which was granted by the court on September 10, 1964.

On September 29, 1964, the defendants filed a motion to dismiss the case, which Aro opposed on October 5, 1964. The court denied the motion to dismiss on October 24, 1964. However, on the same day, Aro learned of a conversation between the defen...

Facts:

Inception of the Attorney–Client Relationship

• Petitioner, a practicing attorney, was engaged by respondents Luis Magtibay and Pablo Magtibay, heirs in the estate of their deceased uncle Lucio Magtibay, to prosecute their claim on a contingent fee basis.
• The terms of this engagement were set forth in a written agreement (Annex A) where it was stipulated that the petitioner was entitled to a fraction of whatever recovery his clients might obtain.

Initiation of Litigation and Court Proceedings

• Acting on the agreement, petitioner undertook all necessary steps to gather relevant documents and file both a petition to litigate as a pauper and a complaint in Civil Case No. SC-525 before the Court of First Instance of Laguna.
• The petition to litigate was granted by the respondent Judge by order dated September 10, 1964, allowing the case to proceed with Luis and Pablo Magtibay as plaintiffs.

Motions to Dismiss and the Court’s Initial Rulings

• Defendants in the case filed a motion to dismiss on September 29, 1964, challenging the merit of the complaint.
• Petitioner's timely opposition to this motion was filed on October 5, 1964, after which the open hearing of both the motion to dismiss and the opposition culminated in the respondent Judge issuing an order on October 24, 1964, denying the motion to dismiss.

Extrajudicial Settlement and Its Effect on the Fee Claim

• On the same day as the hearing, a conversation took place between petitioner and the attorney of the defendants (Atty. Rustico de los Reyes, Jr.), discussing an amicable settlement that involved transferring a property valued at P3,000.00 as a full settlement of the claim.
• Subsequently, a second motion to dismiss was filed on October 26, 1964, accompanied by a document titled “Kasulatan ng Paghahatian na Labas sa Hukuman at Pagpapalabi” (Annex A), which revealed that the plaintiffs (respondents Luis and Pablo Magtibay) and defendant Aurelia Martinez had agreed to an extrajudicial partition and waiver.
• This extrajudicial agreement effectively waived the fee interest of the petitioner, thus prejudicing his right under the contingent fee contract.

Filing of the Counter-Motion and Subsequent Court Orders

• In response, petitioner filed, on November 3, 1964, an “Opposition to the Second Motion to Dismiss and Counter-Motion or Petition to Set Aside Deed of Extrajudicial Partition and Waiver and to Record Attorney’s Lien” seeking:
• The annulment of the extrajudicial partition and waiver;
• The fixing of his compensation (either as one-third of the one-fourth share of the recovered estate or a fixed amount of P1,000.00) coupled with the recording of an attorney’s lien over the disputed property.
• Despite these pleadings, on November 21, 1964, the respondent Judge dismissed Civil Case No. SC-525, thus failing to protect petitioner's fee claim.
• A subsequent motion for reconsideration filed on December 4, 1964, was denied on January 9, 1965, affirming the lower court’s dismissal.

Petition for Certiorari and Mandamus

• Petitioner advanced a petition for certiorari alleging grave abuse of discretion in dismissing the case based on a settlement entered without his consent and in violation of his fee arrangement.
• He also sought mandamus to compel the respondent Judge to take cognizance of and resolve his counter-motion regarding his attorney’s fee claim.
• In support of his position, petitioner cited both American legal authorities and local precedent (e.g., Rustia vs. the Judge of First Instance of Batangas and Recto vs. Harden) underscoring the judicial responsibility to protect an attorney’s contractual rights against collusive settlements.

Issue:

Whether the respondent Judge committed grave abuse of discretion by dismissing the case in a manner that prejudiced the petitioner’s right to recover his contingent attorney’s fee.

• Is it proper for a court to dismiss an action based on an extrajudicial compromise that was executed without the attorney’s participation, thus effectively waiving his fee claim?

Whether the extrajudicial partition and waiver agreement, entered into by the parties (without petitioner’s consent), is fraudulent or void insofar as it seeks to defeat the petitioner’s contractual rights.

• Does the settlement, despite being agreed upon by the parties, improperly prejudice the petitioner’s rightful fee, making it subject to judicial nullification or modification?

Whether judicial intervention through certiorari (and mandamus) is the correct remedy to protect the rights of attorneys as officers of the court when faced with collusive agreements designed to circumvent their fee entitlements.

• Do established American and Philippine precedents support such judicial intervention to secure an attorney’s contingent fee against unilateral settlements by clients?

Ruling:

• (Subscriber-Only)

Ratio:

• (Subscriber-Only)

Doctrine:

• (Subscriber-Only)