G.R. No. 168251 - Montemayor vs. Millora

On July 24, 1990, respondent Vicente D. Millora obtained a loan of ₱400,000.00 from petitioner Dr. Jesus M. Montemayor, evidenced by a promissory note.
On August 10, 1990, the parties executed a loan contract stipulating 2% monthly interest; Vicente paid ₱100,000.00 principal and ₱8,000.00 interest. With Vicente’s consent, the rate rose to 3.5% (₱10,500.00/month). From March 24 to July 23, 1991, Vicente owed ₱42,000.00 interest but paid only ₱24,000.00 and ceased payments.

On August 17, 1993, Jesus filed Civil Case No. Q-93-17255 for sum of money; on October 19, 1993, Vicente answered and counterclaimed for at least ₱500,000.00 attorney’s fees, alleging legal services rendered and his abrupt dismissal.
On October 27, 1999, RTC Branch 98 rendered judgment: (a) Vicente to pay Jesus ₱300,000.00 plus 12% interest per annum from August 17, 1993 until fully paid; (b) awarded Vicente attorney’s fees “on the basis of quantum meruit” equivalent to whatever amount recoverable from him by Jesus, to be set off against Jesus’s award.

Vicente’s December 8, 1999 motion for reconsideration was denied; on March 15, 2000, he sought a writ of execution for the attorney’s fees portion—granted June 23, 2000. Vicente’s July 6, 2000 notice of appeal was denied as the judgment was final. Jesus filed motions for reconsideration and a writ of execution; RTC denied both on September 6, 2002 and October 2, 2003.
On May 19, 2005, the Court of Appeals denied Jesus’s Rule 65 petition and affirmed the RTC orders. Jesus then filed a Rule 45 petition for review on certiorari before the Supreme Court.

Whether, despite the RTC decision’s failure to specify the exact amount of attorney’s fees on Vicente’s counterclaim, such fees can validly be set off (compensated) against the fixed monetary award to Jesus.