FACTS:

Dr. Indalecio Casasola had a contract with a building contractor named Norman Guerrero

Philippine American General Insurance Co. Inc. (Philamgen) acted as bondsman for Guerrero. In view of
Guerrero's failure to perform his part of the contract within the period specified, Dr. Casasola, thru his
counsel, Atty. John Quirante, sued both Guerrero and Philamgen
o

Philamgen filed a cross-claim against Guerrero for indemnification

RTC: in favor of Dr. Indalecio Casasola by rescinding the contract ordering Guerrero and Philamgen to
pay actual damages of P129,430, moral damages of P50,000, exemplary damages of P40,000 and attorney's
fees of P30,000 ordering Guerrero alone to pay liquidated damages of P300/day from December 15, 1978
to July 16, 1979 and ordering Philamgen to pay Dr. Casasola the amount of the surety bond equivalent to
P120,000.

Petition to quash the writ of execution and to compel the trial court to give due course to the appeal was
dismissed

In the mean time, Dr. Casasola died leaving his widow and several children as survivors

Quirante filed a motion in the trial court for the confirmation of his attorney's fees
o

According to him, there was an oral agreement between him and the late Dr. Casasola that in case
of recovery of the surety bond - P30K and in case of damages excess of the surety bond, divided
equally bet. the heirs, Atty. Quirante and Atty. Cruz.

RTC: granted the motion for confirmation

ISSUE: W/N Atty. Quirante can claim attorney's fees

HELD: NO. present recourse is hereby AFFIRMED
Since the main case from which the petitioner's claims for their fees may arise has not yet become final, the
determination of the propriety of said fees and the amount thereof should be held in abeyance. This procedure gains
added validity in the light of the rule that the remedy for recovering attorney's fees as an incident of the main action
may be availed of only when something is due to the client. Thus, it was ruled that:
... an attorney's fee cannot be determined until after the main litigation has been decided and the
subject of recovery is at the disposition of the court. The issue over attorney's fee only arises when
something has been recovered from which the fee is to be paid.

attorney's fees may be asserted either in:

o

the very action in which the services in question have been rendered -as in this case

the Court may pass upon said claim, even if its amount were less than the minimum
prescribed by law for the jurisdiction of said court, upon the theory that the right to
recover attorney's fees is but an incident of the case in which the services of counsel have
been rendered

rests on the assumption that the court trying the case is to a certain degree already
familiar with the nature and extent of the lawyer's services

The rule against multiplicity of suits will in effect be served

a separate action

2 Kinds of Attorney's fees

o

1. item of damages provided for under Article 2208 of the Civil Code wherein the award is made
in favor of the litigant, not of his counsel, and the litigant, not his counsel, is the judgment creditor
who may enforce the judgment for attorney's fees by execution

2. claims are based on the contract for professional services, with the attorney as the creditors and
the clients as the debtors

It is further observed that the supposed contract alleged by petitioners as the basis for their fees provides
that the recovery of the amounts claimed is subject to certain contingencies

We are of the considered view that the orderly administration of justice dictates that such issue be likewise
determined by the court a quo inasmuch as it also necessarily involves the same contingencies in
determining the propriety and assessing the extent of recovery of attorney's fees by both petitioners herein.
The court below will be in a better position, after the entire case shall have been adjudicated

We, therefore, take exception to and reject that portion of the decision of the respondent court which holds
that the alleged confirmation to attorney's fees should not adversely affect the non-signatories thereto, since
it is also premised on the eventual grant of damages to the Casasola family, hence the same objection of
prematurity obtains and such a holding may be pre-emptive of factual and evidentiary matters that may be
presented for consideration by the trial court

G.R. No. 86100-03 January 23, 1990

METROPOLITAN BANK AND TRUST COMPANY, petitioner,
vs.
THE HONORABLE COURT OF APPEALS and ARTURO ALAFRIZ and ASSOCIATES, respondents.
FACTS: A certain Celedonio Javier bought seven (7) parcels of land owned by Eustaquio
Alejandro, et al., with a total area of about ten (10) hectares. These properties were
thereafter mortgaged by Javier with the petitioner to secure a loan obligation of one Felix
Angelo Bautista and/or International Hotel Corporation. During the pendency of these suits
that these parcels of land were sold by petitioner to its sister corporation, Service Leasing
Corporation and on the same day, the properties were resold by the latter to Herby
Commercial and Construction Corporation. Three months later, mortgaged the same
properties with Banco de Oro wherein the lower court found that private respondent, did not
have knowledge of these transfers and transactions.
Petitioner filed an urgent
motion for substitution of party as a consequence of the transfer of said parcels of land to
Service Leasing Corporation. Private respondent, on its part, filed a verified motion to enter
in the records of the aforesaid civil cases its charging lien, pursuant to Section 37, Rule 138
of the Rules of Court, equivalent to twenty-five percent (25%) of the actual and current
market values of the litigated properties as its attorney's fees. Despite due notice, petitioner
failed to appear and oppose said motion, as a result of which the lower court granted the

same and ordered the, Register of Deeds of Rizal to annotate the attorney's liens on the
certificates of title of the parcels of land.
Private respondent filed a motion to fix its attorney's fees, based on quantum meruit, which
motion precipitated an exchange of arguments between the parties. On May 30, 1984,
petitioner manifested that it had fully paid private respondent; the latter, in turn, countered
that the amount of P50,000.00 given by petitioner could not be considered as full payment
but merely a cash advance, including the amount of P14,000.00 paid to it on December 15,
1980. It further appears that private respondent attempted to arrange a compromise with
petitioner in order to avoid suit, offering a compromise amount of P600,000.00 but the
negotiations were unsuccessful.
ISSUES:
1. Whether or not private respondent is entitled to the enforcement of its charging lien for
payment of its attorney's fee.
HELD:
1. NO. On the matter of attorney's liens Section 37, Rule 138 provides: He shall also have a
lien to the same extent upon all judgments for the payment of money, and executions
issued in pursuance of such judgments, which he has secured in a litigation of his client,
from and after the time when he shall have caused a statement of his claim of such lien to
be entered upon the records of the court rendering such judgment, or issuing such
execution, and shall have caused written notice thereof to be delivered to his client and to
the adverse party; and he shall have the same right and power over such judgments and
executions as his client would have to enforce his lien and secure the payment of his just
fees and disbursements. Consequent to such provision, a charging lien, to be enforceable as
security for the payment of attorney's fees, requires as a condition sine qua non a judgment
for money and execution in pursuance of such judgment secured in the main action by the
attorney in favor of his client. A lawyer may enforce his right to fees by filing the necessary
petition as an incident in the main action in which his services were rendered when
something is due his client in the action from which the fee is to be paid. The civil cases
below were dismissed upon the initiative of the plaintiffs "in view of the frill satisfaction of
their claims."
RESEARCH and SERVICES REALTY, INC., petitioner, vs COURT OF APPEALS and MANUEL S.FONACIER, JR., respondents
.
FACTS:On 3 November 1969, the petitioner
RESEARCH and SERVICES REALTY, INC. entered into a JointVenture Agreement with Jose, Fidel, and Antonia Carreon. On 4 April
1983, the Carreons and a certain Patricio C .Sarile instituted before the RTC of Makati City an action against the petitioner for rescission of the
Joint Venture Agreement. On 9 April 1985, the petitioner engaged the services of private respondent Atty. Manuel S.
Fonacier,Jr., who then entered his appearance in Civil Case No. 612.While the said case was pending, the petitioner,
without the knowledge of the private respondent, enteredinto a Memorandum of Agreement (MOA) with another land
developer, Filstream International, Inc.On 31 March 1993, the petitioner terminated the legal services of the private
respondent. At the time the petitioner had already received P7 million from Filstream. Upon knowing the existence
of the MOA, the private respondent filed in Civil Case No. 612 an Urgen tMotion to Direct Payment of Attorney's Fees
and/or Register Attorney's Charging Lien praying, among other things, that the petitioner be ordered to pay him the sum of
P700,000.00 as his contingent fee in the case.
Petitioner contends that private respondent did not exert any effort to amicably settle the case, nor was even present
during the negotiations for the settlement of the same. There was, therefore, no legal and factual justification for the
private respondent's "fantastic and unreasonable claim for attorney's fees of P600,000.00."On the other hand, the
private respondent asserted that he was assured by the petitioner that non-collection cases were included in the
contingent fee arrangement specified in the retainer contract wherein there was to becontingent compensation for any
award arising from any lawsuit handled by him. According to him, Civil Case No.612 was not the only "non-collection" case he
handled for the petitioner.

ISSUE: Whether respondent is entitled to attorneys fees for the MOA

An analysis of the contract clearly shows that it was a general retainer, since its primary purpose was to secure
beforehand the services of the private respondent for any legal problem which might afterward arise. i[19] The fixed
retaining fee was P800.00 a month. A retaining fee is a preliminary fee paid to ensure and secure a lawyer's future
services, to remunerate him for being deprived, by being retained by one party, of the opportunity of rendering
services to the other party and of receiving pay from him. In the absence of an agreement to the contrary, the
retaining fee is neither made nor received in consideration of the services contemplated; it is apart from what the
client has agreed to pay for the services which he has retained him to perform. ii[20]
In the retainer contract in question, there was no intention to make the retaining fee as the attorney's fees for the
services contemplated. This is evident from the provision allowing additional attorney's fees in collection cases
consisting of (1) a "contingent fee" and (2) whatever the petitioner might recover as attorney's fees in each case. The
latter could only refer to the attorney's fees which the court might award to the petitioner in appropriate cases.
While the contract did not mention non-collection cases, it is, nevertheless, clear therefrom that such cases were not
excluded from the retainership, as borne out by the provision requiring the private respondent to "make appearances
in Court for cases involving the corporation or any allied cases pertaining to the latter." As to such cases, there was
no specific stipulation of additional attorney's fees. Nevertheless, nothing therein shows that the private respondent
agreed to render professional service in such cases gratuitously. The absence then of the stipulation of additional
attorney's fees cannot be construed as a bar to the collection of additional attorney's fees in non-collection cases.
Two basic principles come into play. The first is as stated earlier, viz., that the retaining fee is neither made nor
received in consideration of the services contemplated unless the contract itself so provides. The second is that,
unless expressly stipulated, rendition of professional services by a lawyer is for a fee or compensation and is not
gratuitous. This is implicit from the opening clause of Section 24, Rule 138 of the Rules of Court, which states that
"[a]n attorney shall be entitled to have and recover from his client no more than a reasonable compensation for his
services . . .," and by virtue of the innominate contract of facio ut des (I do and you give), as enunciated by this
Court in Corpus v. Court of Appeals

i
ii