G.R. No. 135857 - People vs. Arca

Petitioners: Atty. Rolex T. Suplico and Atty. Demaree J.B. Raval, former partners in the law firm Raval Suplico and Lokin, Lawyers.
Respondents: Atty. Luis K. Lokin, Jr. and Atty. Salvador C. Hizon, who, as former partners, were alleged to have deviated from the agreed distribution of attorney’s fees.
The dispute arose from a complaint for disbarment and a concurrent criminal case for estafa, both initiated by the petitioners.

The petitioners filed a complaint before the Integrated Bar of the Philippines (IBP) Commission on Bar Discipline alleging violation of Rule 7.03 and Canon 7 of the Code of Professional Responsibility.
The core allegation centered on the respondents’ refusal to turnover their respective shares (purportedly P144,831,371.49, representing 40% of a total recovery of P362,078,428.74) derived from the Aerocom Investors & Managers, Inc. recovery.
Allegedly, as partners in the law firm, it was agreed that 30% of the partnership profits would go to Atty. Hizon while the remaining 70% was to be equally divided among petitioners and Atty. Lokin.

The Investigating Commissioner, Jose I. De la Rama, Jr., issued a report recommending dismissal of the disbarment case, primarily due to the absence of a valid, documented retainer’s agreement for the payment of the 40% fee.
Key issues included:

The alleged lack of a written agreement despite references by Aerocom’s corporate officers.
Inconsistencies in the affidavit of Atty. Jessica A. Los Banos, who failed to identify the document evidencing the supposed fee arrangement.

The report noted that the petitioners could not produce a copy of the agreement, while both the President and Corporate Secretary of Aerocom denied its existence.

The IBP Board of Governors first adopted the Investigating Commissioner’s recommendation through Resolution No. XVIII-2009-52 and later affirmed it via Resolution No. XIX-2011-484.
These resolutions validated that petitioners had received their share from the Aerocom case and had further waived additional claims through executed quitclaims.

Atty. Suplico executed a quitclaim effective from January 15, 1995, thereby relinquishing any further claim over the distribution of fees from the Aerocom case.
Similarly, Atty. Raval’s withdrawal from the partnership (accompanied by a waiver of his rights in exchange for the Amberland office space) effectively barred any further disputes regarding the fee arrangement.

Whether the petitioners successfully demonstrated the existence of a valid and binding retainer’s agreement obligating the defunct law firm to pay 40% of the Aerocom recovery as attorney’s fees.
Whether the alleged agreement, acknowledged by some parties but denied by Aerocom’s corporate officers, had sufficient evidentiary support.

Whether the respondents committed misconduct or acted in bad faith by allegedly failing to remit the petitioners’ share of the agreed-upon fees.
Whether such actions, if proven, would constitute a violation of Rule 7.03 and Canon 7 of the Code of Professional Responsibility.

Whether the executed releases, waivers, and quitclaims by the petitioners effectively nullified any claim over the fee distribution from the Aerocom case.
Whether the quitclaims, executed voluntarily and with full knowledge of their implications, dispense with the petitioners’ rights to further financial recovery.