G.R. No. 5235; March 22, 2000
Fernando C. Cruz and Amelia Cruz, complainants, vs. Atty. Ernesto C. Jacinto, respondent.

FACTS

Complainants, spouses Fernando and Amelia Cruz, engaged the services of Atty. Ernesto C. Jacinto as their lawyer in an unrelated case. In June 1990, respondent requested a loan from the spouses on behalf of a certain Concepcion G. Padilla, whom he presented as an old friend in need. Trusting their lawyer’s representations, the complainants agreed to a loan of PHP 285,000.00, secured by a real estate mortgage on a property in Quezon City. They delivered the amount to respondent and received a Real Estate Mortgage Contract and a Transfer Certificate of Title (TCT) in Padilla’s name.
Upon the loan’s maturity, the spouses discovered that Padilla did not exist at the given address and that the TCT was fake, as certified by the Register of Deeds. Investigations revealed that respondent instructed his secretary to prepare the mortgage documents and to forge a notary public’s signature, and his housemaid to simulate the signature of a Deputy Register of Deeds to fake the annotation of the mortgage. A criminal case for estafa through falsification was filed against respondent, though it was later dismissed due to the complainants’ voluntary desistance.

ISSUE

Whether Atty. Ernesto C. Jacinto should be held administratively liable for professional misconduct arising from his actions in facilitating the fraudulent loan transaction.

RULING

Yes, respondent is administratively liable. The Supreme Court adopted the Integrated Bar of the Philippines’ recommendation and suspended him from the practice of law for six months. The legal logic centers on the violation of the Code of Professional Responsibility and the fiduciary duties of a lawyer.
Respondent acted not merely as an agent but as the complainants’ lawyer in the transaction, owing them the highest degree of good faith, honesty, and fidelity. His direct involvement in the fabrication of documents—ordering the forgery of signatures to simulate notarization and registration—constitutes unlawful, dishonest, and deceitful conduct under Rule 1.01 of the Code. The dismissal of the criminal case due to voluntary desistance does not absolve him in this sui generis disciplinary proceeding, which aims to protect the public and the integrity of the legal profession, not to punish.
The Court emphasized that business dealings between a lawyer and client are scrutinized with extreme caution. Respondent exploited the trust reposed in him, failing to protect his clients’ interests and instead facilitating a scheme built on falsified documents. His claim of being an equally deceived victim is unavailing; his active role in the falsification process demonstrates a clear breach of professional ethics. His subsequent payment of the loan is merely a mitigating factor, not an exemption from administrative liability.