Atty. Orocio vs.

Anguluan
GR No. 179892-93; 30 January 2009
Facts:
NAPOCOR passed a resolution approving the grant of a monthly welfare allowance
equivalent to 10% of basic pay to all its employees effective 1 October 1978. This was called the
NAPOCOR Welfare Fund. Later on NAPOCOR passed a resolution lowering it to 5%. After 2
decades Congress passed EPIRA which directed the reorganization of NAPOCOR. Following the
directive of EPIRA NAPOCOR abolished the fund. Later on NAPOCOR was approved to
release P184M from the fund for distribution to members who resigned, retired or separated.
Anguluhan however issued a memorandum that allowed the release to separated members only
to the exclusion of those who resigned, retired or separated prior to the EPIRA.
Segovia, Baysic and affected employees affected represented by Atty. Orocio filed with
the RTC a petition for mandamus with a prayer for a TRO against NPC. Orocio and his clients
settled for a contingency fee of 15%. The parties settled for a compromise agreement which
granted earning differential to the affected members and allowed Orocio to collect 15% from it
as attorneys fees.
RTC issued a writ of execution for Orocio to collect his attorneys fees. A notice of
garnishment was also issued. But, respondents contended that the amount Orocio based his 15%
fees was merely an estimate. Respondents appealed to the CA which issued a TRO. The CA held
that Orocio may only collect P1M on the basis of quantum meruit because the employees settled
through a compromise agreement and not won by Orocio in a trial.
Issue:
Whether the Atty. Orocio may collect 15% of the amount stated in the Compromise Agreement.
Ruling:
No. First, herein respondents are not clients of Orocio they are in fact the opponents of Orocios
clients. There had been no objection by his clients when he partially collected from payments by
NAPOCOR to them. His clients do not claim any damage or injury by the issuance of the writ of
execution. The 15% to be collected by Orocio is from the agreement with his clients that he will
only collect contingency fees. This kind of arrangement is allowed by law subject to Canon 20
which provides that a lawyer shall charge fair and reasonable fees. The principle of quantum
meruit may be a basis for determining reasonable attorneys fees. This principle may apply even
if there is already an agreed written fee as long as the court finds it unconscionable.
The SC found Orocio to have worked diligently and if it were not for him there would have been
no compromise agreement. However, the attorneys fees had to be reduced to 10% which is also
the percentage allowed by the labor code. The practice of law is a profession and not a
moneymaking venture.