G.R. No. 179892 -93 January 30, 2009
ATTY. VICTORIANO V. OROCIO, Petitioner, vs. EDMUND P. ANGULUAN, LORNA T. DY and NATIONAL POWER CORPORATION, Respondents.

FACTS

On September 26, 1978, the National Power Corporation (NAPOCOR) Board passed Resolution No. 78-119 approving a monthly welfare allowance for employees, leading to the creation of the NAPOCOR Welfare Fund. The fund’s charter provided for the distribution of its balance to members upon termination. Following the Electric Power Industry Reform Act (EPIRA) of 2001, the NAPOCOR Board passed Resolution No. 2003-43 on March 26, 2003, dissolving the Welfare Fund. The NAPOCOR Welfare Fund Board of Trustees (NAPOCOR-WFBT) then approved Resolution No. 2004-001, authorizing the release of ₱184 million for distribution only to members who separated upon EPIRA’s effectivity (EPIRA separated members), excluding those who separated prior (non-EPIRA separated members). This prompted former officers, Perla A. Segovia and Emma C. Baysic, representing 559 non-EPIRA separated members, to file a Petition for Mandamus, Accounting and Liquidation (Civil Case No. Q04-53121) against NAPOCOR and its officers. They were represented by petitioner Atty. Victoriano V. Orocio under a “Legal Retainer Agreement” dated September 1, 2004, stipulating a 15% contingency fee. The parties executed a Compromise Agreement on February 22, 2006, which recognized the entitlement of both EPIRA and non-EPIRA separated members to “Corrected Earnings Differential” and stipulated that 15% attorney’s fees shall be deducted from the corresponding Corrected Earnings Differential of those non-EPIRA separated members who have executed a Special Power of Attorney for such deduction. The Quezon City RTC approved the Compromise Agreement on April 3, 2006. Petitioner filed a Motion for Approval of Charging (Attorney’s) Lien, which the RTC granted on May 15, 2006. Petitioner then moved for a writ of execution. Respondents opposed, contending the ₱119,196,000.00 due to non-EPIRA members was a mere estimate and could not be a valid basis for the 15% fee. The RTC granted the motion and issued a writ of execution on July 26, 2006. Respondents Anguluan and Dy filed a Petition for Certiorari with the Court of Appeals (CA-G.R. SP No. 95786), which was consolidated with a related petition filed by NAPOCOR (CA-G.R. SP No. 95946). The Court of Appeals granted the petitions, annulling the RTC’s orders for execution and the writ of garnishment, and permanently enjoined the enforcement of the attorney’s fees lien. Petitioner filed the present Petition for Review.

ISSUE

Whether the Court of Appeals erred in annulling the RTC’s orders for execution and the writ of garnishment, and in permanently enjoining the enforcement of the attorney’s fees lien based on the Compromise Agreement.

RULING

The Supreme Court denied the petition and affirmed the Court of Appeals’ decision. The Court held that the RTC’s orders for execution and the writ of garnishment were issued with grave abuse of discretion. The Compromise Agreement did not provide a specific, liquidated amount for the attorney’s fees; it only referred to an “estimated” Corrected Earnings Differential of ₱119.196 Million for non-EPIRA separated members. An estimate is not a definitive sum that can be immediately executed upon. The agreement further conditioned the deduction of the 15% fee on the non-EPIRA separated members having executed a corresponding Special Power of Attorney/Written Authority. The records did not show that this condition had been fulfilled for all members. Therefore, the basis for the computation and enforcement of the attorney’s fees was not yet certain and determinable. The execution was premature as the exact amount due to the members, and consequently the 15% thereof, had not been ascertained. The Court also noted that a lawyer’s charging lien under Section 37, Rule 138 of the Rules of Court attaches only to a judgment for money and is for the recovery of a specific sum. Since the Compromise Agreement did not award a specific sum of money but only recognized a right to an amount still to be determined, no charging lien could validly attach. The writ of execution and garnishment were thus improperly issued.