Case Digest (G.R. No. 72841)
Facts:
The Province of Cebu assailed the award of attorney’s fees to Atty. Pablo P. Garcia, arising from a case originally filed in 1965 to annul a deed of donation of province-owned lots to the City of Cebu. While Governor Rene Espina was on official business, the Vice-Governor and members of the Provincial Board passed Resolution No. 188 authorizing the donation; the dispute later led Espina to engage Garcia to file and prosecute the annulment case with a petition for writ of preliminary injunction, which was granted on August 6, 1965.
The case culminated in a compromise agreement approved by the trial court on July 15, 1974, directing, among others, the return of specified lots and related payments between the province and the city. Garcia later filed a notice of attorney’s lien (April 14, 1975). The trial court (May 30, 1979) awarded quantum meruit fees of PHP 30,000.00 plus reimbursement of PHP 289.43; the Intermediate Appellate Court affirmed the entitlement but fixed fees at 5% of the market value of the lots as of the 1975 claim date.
Issues:
- Whether Garcia’s employment as counsel for the Province of Cebu was unauthorized and therefore barred recovery of attorney’s fees.
- Whether the award of attorney’s fees, as fixed by the trial court under quantum meruit, was proper.
Ruling:
The Court set aside the Intermediate Appellate Court’s decision fixing attorney’s fees at 5% and reinstated the trial court’s order dated May 30, 1979, awarding Garcia PHP 30,000.00 attorney’s fees and reimbursement of PHP 289.43.
The Court held that, under the exceptional circumstances where an intramural dispute pitted the Governor against the Provincial Board members, strict compliance with the statutory scheme for representation would have been impossible, and equity supported allowing compensation for the services rendered.
Ratio:
The Court found that the general rule limiting representation of provinces and municipalities to the provincial fiscal and municipal attorney under Sections 1681 to 1683 of the Revised Administrative Code could not control in a situation where the Provincial Board members were the very parties being sued, making it unthinkable for the Board to authorize counsel to sue itself. It further ruled that the Provincial Fiscal could not be expected to act for the province against the Board where the Fiscal’s representation would effectively align with the Board’s challenged acts.
On compensation, the Court applied the exception to the rule that an attorney cannot recover fees from one who did not employ or authorize him, noting presumptions of authority and ratification through acquiescence, and the principle that the municipality cannot retain the benefit of services while denying payment. The Court also concluded that awarding PHP 30,000.00 on quantum meruit was the reasonable measure of compensation, and that 30% or even 5% of the value of the properties was not warranted given the litigation’s resolution by compromise and the limited extent of participation remaining to Garcia at that stage.
Doctrine:
- Representation rules under Sections 1681 to 1683 of the Revised Administrative Code yield to exceptional circumstances where strict compliance would be impossible due to an intramural dispute.
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