SALALIMA v.

GUINGONA

FACTS: I
n 1993, administrative complaints were filed in the Office of the President against
Albay Governor Salalima and other Sanggunian officials. One of the causes of action
against Salalima is the entering into a retainer contract with Atty Cornago and the Cortes &
Reyna Law Firm and the disbursements of public funds in payment thereof.
It was shown that the Albay Sangguniang Panlalawigan of Albay adopted
Resolution 01-90 authorizing Salalima to engage the services of a Manila-based law firm,
and later on, Atty Cornago and Cortes & Reyna Law Firm. This is despite the availability of
the provincial legal officer, Atty Ricafort, who already submitted the petition.
The retainer contract provides that the Atty. Cornago and the law firm shall receive
P50,000 as acceptance fee and 18% of the value of the NPC property which is P214
Million. P7.3 Million were already paid by the province to the lawyers when the
Commission of Audit discovered the irregularities and disallowed further disbursements.

ISSUE: WON respondents have incurred administrative liability in entering into the retainer
agreement with Atty. Cornago and the Cortes & Reyna Law Firm and in making payments
pursuant to said agreement

HELD: YES, guilty. But Salalima & Co. cannot be subject to disciplinary action for
administrative misconduct committed during a prior term.

RATIONALE: Sec. 481 of the Local Government Code (R.A. No. 7160) requires the
appointment of a legal officer for the province whose function is to represent the local
government unit in all civil actions and special proceedings wherein the local government
unit or any official thereof, in his official capacity, is a party. Exception to this rule is when a
component city or municipality is a party adverse to the provincial government or to
another component city or municipality. Since the case does not fall under the exception,
the retainer contract is contrary to law.
The respondents also violated Circular 86-25 which requires a prior written approval
of the Solicitor General and written concurrence of the COA before disbursements can be
made to lawyers. However, in this case, the written approval of the SolGen was secured
only after the disbursement was made.
Another irregularity was the fact that it was only Atty. Cornego who appeared as the
corroborating counsel of the Province of Albay in the Supreme Court case. The law firm
never made its appearance although it was paid P3.6 Million.
The attorney’s fee was also unconscionable. The only tasks the lawyers performed
were to appear in court and submit a memorandum, which are not commensurate to the
fee of P38.5 Million. The professional character and social standing of Atty. Cornago are
not such as would merit a P38.5 million fee for the legal services rendered. It was admitted
later that the governor hired Atty. Cornago because they were schoolmates at San Beda
College.
By considering the labor and time involved, the skill and experience called for in the
performance of the services and the professional character and social standing of the
lawyers, the attorney’s fee of P38.5 million is unconscionable. Allowing such attorney’s
fees, which is patently disadvantageous to the state, respondents are guilty of grave abuse
of authority.