Case Summary (G.R. No. 76647)
Facts of the Case
The petitioner, Guenter Bach, engaged the legal services of the respondent law firm, Ongkiko Kalaw Manhit & Accorda Law Offices, to represent him in a Petition for Declaration of Nullity of Marriage filed before the Regional Trial Court of Makati City. A Fee Agreement was signed, stipulating payment as follows: 7.5% of all cash recoveries and 5% of the market value of properties awarded to the petitioner. On December 5, 1995, the respondent withdrew its representation due to policy differences. Subsequently, the respondent issued a termination billing amounting to P1,000,000.00 plus 2% monthly interest for late payment.
Notices and RTC Actions
On March 7, 1996, the respondent filed a Notice of Charging Lien with the RTC concerning the properties of the spouses Bach. An RTC order on February 5, 1997, directed the annotation of this lien. On February 11, 1999, the respondent received a court order granting Bach’s motion to withdraw his petition. Despite demands for payment, Bach failed to settle, leading the respondent to file a complaint for the collection of the alleged fees before the RTC.
Trial Court Proceedings
In the RTC, the petitioner sought to dismiss the complaint, claiming prior payments totaling P200,000.00 for services rendered. The motion to dismiss was denied, and the court later found him in default for not filing an answer. The RTC ruled in favor of the respondent, awarding P750,000.00 as attorney's fees, P700,000.00 for billable time, and P50,000.00 for litigation expenses.
Court of Appeals Ruling
Upon appeal, the Court of Appeals modified the RTC's decision by deleting the P700,000.00 billable time award while upholding the rest of the judgment. Petitioner subsequently sought review from the Supreme Court, questioning the reasonableness of the fees awarded under quantum meruit.
Reasonableness of Attorney’s Fees
The Supreme Court reiterated established legal principles concerning the assessment of attorney’s fees based on quantum meruit. The rule dictates that such assessments are factual determinations typically not disturbed unless contravening substantial evidence.
Supreme Court’s Findings
The Court noted that in assessing reasonable attorney’s fees, it considers various factors, including the complexity of the case, the services rendered, and the attorney's professional standing. In this instance, the services provided did not evidence extraordinary complexity, leading the Court to determine that the fees should be set at P500,000.00.
Interest on Fees
The Supreme Court determined that the imposition of 2% legal interest on the attorney's fees was unwarranted. Citing relevant jurisprudence, it clarified that the mere presence of a contractual relationship does not justify interest unless specifically stipulated, th
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Background of the Case
- The case involves a Petition for Review on Certiorari by Guenter Bach against the Ongkiko Kalaw Manhit & Acorda Law Offices.
- The primary objective is to reverse the Decision dated October 8, 2003, from the Court of Appeals in CA-G.R. CV No. 74445.
- The case originated from a Petition for Declaration of Nullity of Marriage filed by Bach before the Regional Trial Court (RTC) of Makati City, identified as Civil Case No. 95-224.
Engagement of Legal Services
- Bach engaged the services of the respondent law firm on November 7, 1994.
- A "Fee Agreement" was signed detailing the payment structure:
- 7.5% of all cash recoveries, including damages and costs.
- 5% of the market value of properties awarded to Bach.
Withdrawal of Legal Representation
- The law firm withdrew its representation on December 5, 1995, due to policy differences.
- Subsequently, on December 18, 1995, the firm issued a termination billing amounting to P1,000,000.00 plus 2% monthly interest for late payment under their Fee Agreement.
Legal Proceedings and Claims
- On March 7, 1996, the firm filed a Notice of Charging Lien against the properties of the spouses Bach.
- The RTC approved an Order on February 5, 1997, to annotate the charging lien for P1,000,000.00 on the Bach's properties.
- On February 11, 1999, the firm received an Order dated June 8, 1998, granting Bach’s motion to withdraw his petition.
Filing of Complaint by Respondent
- Respondent filed a Complaint for a sum of money before the RTC