Disbarment for Deceitful Real Estate Dealings Using a Forged SPA

The Supreme Court has disbarred a lawyer who used a forged special power of attorney to sell property he did not own, then kept the proceeds while his buyers were forced to pay the true owners to keep the land. The case serves as a firm reminder that lawyers face the ultimate professional sanction when they engage in deceitful conduct, whether in their professional capacity or in private dealings.

The Facts

In 2013, business associates Leonardo Sarmiento and Richard Halili met Atty. Gregorio Fernando Jr. through a broker friend. Fernando offered to sell them a 374-square meter lot in Parañaque City covered by Transfer Certificate of Title No. 68952, which was still registered in the names of his parents, spouses Gregorio and Natividad Fernando.

Fernando assured the buyers that he was the absolute owner of the property. He claimed his parents had already conveyed the land to him through a Special Power of Attorney dated 14 April 2012, and that only an SPA was executed to avoid paying transfer taxes twice. He also represented that both parents were alive, their signatures were genuine, and he was their sole heir.

Persuaded by these representations, the complainants agreed to buy the property for P3,740,000.00. A Deed of Absolute Sale was executed between Fernando, as attorney-in-fact of his parents, and Sylvia Sarmiento, wife of complainant Leonardo Sarmiento. The title was subsequently cancelled and replaced by a new one in Sylvia's name.

The Fraud Uncovered

Soon after, Fernando's own mother, Natividad, and the heirs of his father filed a complaint before the Regional Trial Court of Parañaque City to nullify the SPA, the Deed of Sale, and the new title. The complainants then discovered the truth: the SPA was falsified.

Gregorio Fernando had died on 4 April 1997, as shown by a Certificate of Death from California. He could not have signed the SPA in 2012. Natividad's signature on the SPA was also a forgery when compared to her legitimate signature on her OSCA card. Furthermore, Fernando was not the sole heir—he had at least four living siblings.

To keep the property and end the civil case, Sylvia and Leonardo Sarmiento were forced to pay P2,992,000.00 to the true owners in a settlement approved by the court. Fernando refused to reimburse them despite demands.

The Administrative Case

The complainants filed a disbarment petition before the Integrated Bar of the Philippines. Fernando failed to attend the scheduled hearing, and the case was deemed submitted for decision.

In his belated Answer, Fernando argued that the complainants lacked legal personality because they had also filed an estafa complaint before the city prosecutor. He claimed the SPA was not a forgery but merely a reiteration of earlier SPAs from 2002 and 1978.

The IBP Commission on Bar Discipline found the evidence against Fernando "damning." The SPA was falsified, Fernando was not an attorney-in-fact, he pocketed the P3,740,000.00 purchase price, and he refused to return the P2,992,000.00 settlement amount. The IBP Board of Governors adopted the recommendation to disbar him.

The Supreme Court's Ruling

The Supreme Court agreed. The Court noted that Fernando used a falsified SPA, along with other deceitful representations, to sell and profit from property he knew was not his. Since he was the only one who benefited, the Court presumed he was the material author of the falsification.

Fernando's defenses failed. The existence of earlier SPAs did not prove the 2012 SPA was genuine—that document was executed after his father's death and bore his mother's forged signature. The Court also rejected the claim that the complainants committed perjury in their verification. The estafa complaint and the disbarment petition involve different issues: one concerns probable cause for a criminal charge, the other concerns a lawyer's fitness to practice.

The Court found Fernando guilty of gross violations of Rule 1.01 (a lawyer shall not engage in unlawful, dishonest, immoral or deceitful conduct) and Rule 7.03 (a lawyer shall not engage in conduct that adversely reflects on his fitness to practice law) of the Code of Professional Responsibility.

Citing Brennisen v. Contawi, the Court emphasized that a lawyer who uses a forged SPA to sell another's property and keep the proceeds deserves the ultimate penalty. The Court also rejected Fernando's argument that there was no lawyer-client relationship with the complainants: a lawyer may not divide his personality as an attorney at one time and a mere citizen at another.

The Court disbarred Fernando and ordered his name stricken from the Roll of Attorneys.

Practical takeaways

• A lawyer's ethical obligations apply to private transactions, not just client representation. Misconduct in personal dealings can result in disbarment.
• Using a falsified document to sell property, and keeping the proceeds, constitutes gross dishonesty warranting the ultimate penalty.
• Filing a criminal complaint (like estafa) does not bar a separate administrative case for disbarment; the two proceedings address different issues.
• Lawyers who fail to appear at IBP hearings and show no remorse compound their liability.
• Buyers of real property should verify titles and the authority of persons signing documents, especially when an SPA is used to avoid taxes.

This article is general information and not legal advice. For your specific situation, consult a lawyer or ask ASG Legal AI.