Caalim-Verzonilla v. Pascua
REITERATIONFacts
The Antecedents: On September 15, 2001, respondent Atty. Victoriano G. Pascua prepared and notarized two Deeds of Extra-Judicial Settlement of the Estate of Deceased Lope Caalim with Sale for the same residential lot. The first deed stated a consideration of ₱1,000,000, while the second deed stated a reduced consideration of ₱250,000. Both deeds bore identical registration, page, and book numbers in their notarial portions. Complainant Pacita Caalim-Verzonilla alleged that the signatures of the heirs were forged and that one heir, Marivinia, was mentally incapacitated and confined in a psychiatric ward at the time of the alleged execution. Respondent admitted to preparing both deeds, claiming the second was made at the parties' plea to reduce the enormous taxes due to the Bureau of Internal Revenue (BIR). Procedural History: Complainant filed a verified affidavit-complaint for disbarment against respondent for falsifying public documents and evading taxes. The Supreme Court referred the case to the Integrated Bar of the Philippines (IBP) for investigation. The IBP Investigating Commissioner found respondent liable for abetting tax fraud and recommended a three-month suspension from the practice of law and a two-year disqualification from being commissioned as a notary public. The IBP Board of Governors adopted the findings but increased the recommended suspension from the practice of law to two years. The Petition: This is an administrative proceeding for disbarment. The complainant argues that the respondent's acts of notarizing simulated documents and facilitating tax evasion constitute gross misconduct and a violation of the lawyer's oath. Respondent counters that he acted out of a 'humane and compassionate disposition' to assist his clients and that the second deed was intended to supplant the first, justifying the use of identical notarial entries.
Issue(s)
Whether respondent is liable for the falsification and absolute simulation of the subject deeds. Whether respondent violated the Code of Professional Responsibility and the 2004 Rules on Notarial Practice by preparing two deeds with different considerations for the same transaction and using identical notarial entries.
Ruling
Respondent ATTY. VICTORIANO G. PASCUA is found GUILTY of violating the Code of Professional Responsibility and the 2004 Rules on Notarial Practice. He is SUSPENDED from the practice of law for two (2) years, his notarial commission is REVOKED, and he is DISQUALIFIED from reappointment as a notary public for two (2) years.
Ratio Decidendi
On Issue 1: Regarding the allegations of falsification and simulation, the Court found that the evidence presented in the administrative case was insufficient to make a conclusive finding of fact. It noted that the complainant's assertions of forgery and the mental incapacity of one of the heirs were the subject of a separate pending civil suit for annulment of the documents (Civil Case No. 2836-S). The Court reiterated the principle that a deed of sale stating a price lower than the true consideration is still binding between the parties, though it may have other legal implications. Because the administrative proceeding is focused on the conduct of the lawyer rather than the ultimate validity of the contract, the Court deferred to the trial court for the resolution of the forgery claims. Thus, the respondent was not held liable for falsification in this specific administrative decision, pending the outcome of the civil litigation. On Issue 2: The Court found the respondent liable for violating the Code of Professional Responsibility and the 2004 Rules on Notarial Practice. By his own admission, the respondent prepared and notarized a second deed with a significantly lower consideration specifically to help the parties avoid paying the correct taxes. This act directly violates Rule 1.02, Canon 1 of the Code of Professional Responsibility, which mandates that a lawyer shall not counsel or abet activities aimed at defiance of the law. The Court emphasized that the notarial act is impressed with public interest and that a notary must guard against illegal arrangements. Furthermore, the respondent's use of identical document, page, and book numbers for two different instruments was a blatant violation of Section 2, Rule VI of the 2004 Rules on Notarial Practice. Such conduct undermines the integrity of the notarial register and the public's trust in the legal profession, justifying the two-year suspension from the practice of law and the permanent disqualification from being a notary public.
Main Doctrine
A lawyer's duty to uphold the Constitution and obey the laws of the land (Canon 1, CPR) prohibits the counseling or abetting of activities aimed at defying the law, such as tax evasion through the execution of undervalued deeds. The act of notarization is a public function that converts a private document into a public one, entitled to full faith and credit; thus, a notary who knowingly certifies a document containing untruthful statements regarding consideration violates the integrity of the legal system. Furthermore, the 2004 Rules on Notarial Practice strictly require unique entries in the notarial register for every instrument to ensure the accuracy and integrity of public records. Failure to assign unique document numbers, especially for an unlawful purpose, warrants suspension from the practice of law and revocation of the notarial commission.