A.C. No. 5704 - Kupers vs. HontaNo.s

Case Summary (A.C. No. 5704)

Factual Background

Willem Kupers alleged that Atty. Johnson B. Hontanosas prepared and notarized contracts that violated the statutory limits on leases of private land to aliens. Kupers charged that respondent served conflicting interests by performing legal services for adverse parties, refused to furnish or retain copies of notarized contracts, and failed properly to discharge duties to his client Karl Novak, including refusing to accept Novak’s dismissal as counsel, failing to turn over Novak’s documents, handling matters without adequate preparation, and refusing consultations with a translator selected by Novak. Kupers averred that respondent drafted and notarized four principal documents: a memorandum of agreement and a lease of fifty years renewable for another fifty years between the spouses Busse and Hochstrasser, a Swiss national; a memorandum and a lease of forty-nine years renewable for another forty-nine years between the spouses Busse and Karl Emberger, a Swiss national; and two deeds of sale of the leased properties to Naomie Melchior and Karl Novak. All four documents were notarized by respondent.

Procedural History

The Court Administrator referred the April 15, 2002 letter to the Bar Confidant, which advised that a proper verified complaint must be filed in nineteen copies. Kupers supplied the additional copies on May 25, 2002. The Court required respondent to comment, and respondent answered by accusing the complainant of meddling and of making baseless allegations; respondent also moved that the complainant be cited for contempt. On February 10, 2003, the Court referred the matter to the Integrated Bar of the Philippines for investigation, report, and recommendation. Commissioner Doroteo Aguila required memoranda in lieu of hearings. The investigating commissioner recommended suspension for two months. The IBP Board of Governors, however, disregarded that recommendation and dismissed the complaint on February 27, 2004. The matter returned to the Court for review, which issued the present resolution.

The Parties’ Contentions

Willem Kupers contended that respondent drafted and notarized contracts that were invalid and illegal, that respondent had conflicts of interest, and that respondent breached professional duties to his clients. Atty. Johnson B. Hontanosas denied the charges, asserted that he should not be penalized, accused the complainant of deceit and falsification, and moved for contempt against Kupers. Respondent defended the long lease periods by invoking Republic Act No. 7652, arguing that the agreements could be treated as permissible long-term leases by foreign investors and that the documents should not be regarded purely as lease contracts because they included provisions allowing nomination of a Filipino purchaser.

IBP Investigation and Findings

The investigating commissioner found that the lease agreements violated Presidential Decree No. 471, which limits leases of private lands by aliens to twenty-five years renewable for another twenty-five years. The commissioner concluded that the other charges lacked proof because the complainant was not privy to the agreements between respondent and his clients and failed to present concrete evidence. Commissioner Aguila therefore recommended a two-month suspension for respondent.

IBP Board of Governors’ Disposition

The IBP Board of Governors rejected the investigating commissioner’s recommendation and dismissed the complaint. The Board reasoned that the act was not illegal per se and likely reflected the parties’ attempt to memorialize their agreement without considering legal consequences. The Board acknowledged possible ignorance of the law or negligence on respondent’s part but dismissed the complaint out of compassion.

Supreme Court Review and Findings

The Court rejected the IBP Board’s plea for leniency. The Court observed that administrative cases against lawyers are sui generis and that the complainant need not be the aggrieved party. The Court found that, while most of the ancillary charges lacked proof, the core charge that respondent drafted and notarized lease agreements contravening statutory limits was supported by the documents themselves. The Court held that respondent’s invocation of Republic Act No. 7652 was unavailing because even if the foreign clients qualified as “foreign investors,” R.A. No. 7652 permits an original lease period of fifty years renewable for another twenty-five years, not the fifty years renewable for fifty years or the forty-nine years renewable for forty-nine years stipulated in the contracts before the Court. Accordingly, respondent caused his clients to violate Section 7 of R.A. No. 7652, which renders contracts in violation of its provisions null and void ab initio and prescribes fines and possible imprisonment.

Legal Basis and Reasoning

The Court grounded its decision on the attorney’s sworn duties and on the ethical canons applicable to the practice of law. The Court reaffirmed that the Attorney’s Oath and Canon 1 of the Code of Professional Responsibility require lawyers to uphold the Constitution, obey the laws, and promote respect for legal processes, and that Rule 1.02 under Canon 1 forbids a lawyer from counseling or abetting defiance of the law. The Court identified violations of Canon 15 and Canon 17, including Rule 15.07, which obligate a lawyer to observe candor, fairness, loyalty, and to impress upon clients compliance with the laws. The Court further treated the acts as constituting gross misconduct under Rule 138, Section 27, Rules of Court, which authorizes suspension or disbarment for deceit, malpractice, or other gross misconduct, or for violations of the oath. The Court cited precedent on the special demands placed on practitioners of the law and on the standards for discipline, including Endaya v. Atty. OCA and Santiago v. Fojas, as authorities establishing that a lawyer’s duty extends to the court, the bar, and the public.

Violations Identified

The Court concluded that respondent violated the lawyer’s oath and several provisions of the Code of Professional Responsibility by preparing and notarizing agreements that contravene

Case Syllabus (A.C. No. 5704)

Parties and Procedural Posture

Willem Kupers filed the original letter-complaint dated April 15, 2002 with the Court through the Court Administrator.
Atty. Johnson B. Hontanosas was the respondent in the administrative case arising from the complaint.
The Court Administrator referred the letter-complaint to the Bar Confidant on April 25, 2002.
The case was referred to the Integrated Bar of the Philippines for investigation, report and recommendation.

Key Factual Allegations

Complainant alleged that respondent prepared and notarized contracts that violated limitations on aliens leasing private lands.
Complainant alleged that respondent served conflicting interests by performing legal services for adverse parties.
Complainant alleged that respondent refused to furnish copies of notarized contracts to the contracting parties and failed to keep copies.
Complainant alleged that respondent failed to properly discharge duties to client Karl Novak by refusing to accept Novak's dismissal, failing to turn over Novak's documents, handling matters without adequate preparation, betraying Novak's trust, and refusing to meet Novak with a chosen translator.
Complainant alleged that respondent drafted and notarized a memorandum of agreement and lease between the Spouses Busse and Karl Hochstrasser that provided for a fifty-year lease renewable for another fifty years.
Complainant alleged that respondent drafted and notarized a similar lease between the Spouses Busse and Karl Emberger for forty-nine years renewable for another forty-nine years.
Complainant alleged that respondent drafted two deeds of sale over the leased properties to Naomie Melchior and Karl Novak.

Procedural History

The Acting Bar Confidant requested a verified complaint in nineteen copies, and complainant submitted an additional thirteen copies on May 25, 2002.
Respondent filed an answer characterizing complainant's allegations as opinionated, baseless, false, and containing a falsified document.
Respondent moved that complainant be cited for contempt.
The Court referred the case to the IBP on February 10, 2003.
The investigating commissioner required memoranda in lieu of hearings and issued a report finding a violation of P.D. No. 471 and recommending suspension for two months.
The IBP Board of Governors disregarded the commissioner's recommendation and dismissed the complaint on February 27, 2004.
The Court reviewed the IBP action and rendered the present resolution finding respondent guilty of violations and imposing discipline.

Investigative Findings

The investigating commissioner found that respondent prepared and notarized contracts that violated Presidential Decree No. 471 by exceeding the allowable lease terms for aliens.
The commissioner found that complainant failed to prove the remaining charges due to lack of concrete evidence and lack of privity with the agreements.
The commissioner recommended suspension of respondent from the practice of law for two months.
The IBP Board of Go