FACTS: On June 14, 2005, Mila Virtusio (Mila) filed with this Court a Complaint1

for disbarment against her husband's distant relative, Atty. Grenalyn V. Virtus
io.Mila alleged that sometime in 1999 Atty. Virtusio convinced her to buy a hous
e and lot at North Olympus Subdivision in Novaliches, Quezon City, from its deve
loper, Stateland Investment Corporation (Stateland). Mila agreed for Atty. Virtu
sio to use her personal checks in paying the seller with Mila reimbursing her. U
nder this arrangement, Mila gave Atty. Virtusio the following amounts: P 95,000.
00, P 25,000.00, P 65,000.00, P 64,000.00 and P 64,000.00. All of these were pro
perly receipted except for the P 95,000.00 for which she got a receipt from her
for only P 90,000.00.2 On October 25 and November 24, 1999, Mila deposited ident
ical amounts of P 64,000.00 each in Atty. Virtusios checking account with Equitab
le Bank.3 In all, Mila gave her P 441,000.00.
To her surprise, however, Mila began receiving letters from Stateland, demanding
that she make good the dishonored checks that it got. When she confronted Atty.
Virtusio regarding this, the latter assured her that she would take care of the
problem. But the demand letters persisted.
For fear of losing the property, Mila directly dealt with Stateland in January 2
000. She then found out that her arrearages had come close to P 200,000.00, incl
usive of penalty and interest. In order not to lose the property, Mila and her h
usband decided to settle their overdue obligation with money they borrowed at hi
gh interest.4 In turn, Stateland turned over to her three checks of Atty. Virtus
io, each for P 71,944.97, with the notation "DAIF."5
Mila further alleged that Atty. Virtusio declined to return to her the money the
latter misappropriated despite demand. Only when Mila threatened to file a case
against her did Atty. Virtusio agree to pay her on February 20, 2001 by executi
ng a deed of sale in her favor covering her Mazda car. Despite the sale, however
, Atty. Virtusio pleaded with Mila and her husband to let her keep the car meanw
hile since she needed it in her work. When she refused to give up the car, Mila
filed a replevin case against Atty. Virtusio that the court eventually decided i
n Milas favor.6 But, as it turned out, Atty. Virtusio had managed to register the
car in her childrens name and sold it to a third person. Mila filed a case of es
tafa against Atty. Virtusio7 apart from the present disbarment case.
Mila claimed that Atty. Virtusio evaded the return of money she misappropriated,
impeded the execution of a final judgment, and engaged in conduct that discredi
ts the legal profession, all in violation of the Code of Professional Responsibi
lity, rendering her unfit to remain a member of the bar.
ISSUE: Whether or not the IBP erred in finding Atty. Virtusio guilty of grave mi
sconduct in her dealings with Mila and in notarizing documents without a renewed
commission
HELD: Lawyers are, as officers of the court and instruments for the administra
tion of justice, expected to maintain not only legal proficiency but also a high
standard of morality, honesty, and fair dealing. A lawyers gross misconduct, whe
ther in his professional or private capacity, is ground for suspension or disbar
ment under the principle that, since good moral character is an essential qualif
ication for the admission to the practice of law, maintaining such trait is a co
ndition for keeping the privilege.31
By her own account, Atty. Virtusio admitted misusing the money that Mila entrust
ed to her for payment to Stateland. Her excuse is that she lost track of her fin
ances and mixed up her office funds with her personal funds. But this excuse is
too thin. She admitted misusing P 165,000.00 of Milas money, which is not petty c
ash. Indeed she tried to borrow money from a third person to cover it up rather
than just offer her shallow excuse to Mila. Atty. Virtusios use for personal purp
ose of money entrusted to her constitutes dishonest and deceitful conduct under
the Code of Professional Responsibility. It provides:
Rule 1.01 A lawyer shall not engage in unlawful, dishonest, immoral or decei
tful conduct.
CANON 7 A LAWYER SHALL AT ALL TIMES UPHOLD THE INTEGRITY AND DIGNITY OF THE
LEGAL PROFESSION AND SUPPORT THE ACTIVITIES OF THE INTEGRATED BAR.
Rule 7.03 A lawyer shall not engage in conduct that adversely reflects on hi
s fitness to practice law, nor shall he, whether in public or private life, beha
ve in a scandalous manner to the discredit of the legal profession.
Atty. Virtusio cannot absolve herself of liability by claiming that she failed t
o attend to her finances because she had to look after a sick child at that time
. Assuming she had such a child, the fact is that it was not by mere oversight t
hat she failed to finance the checks for Stateland. For, if this were so, she co
uld have easily rectified her mistake by using her other funds. In truth, she sp
ent the money that Mila entrusted to her because she had no other funds. Indeed,
she had to borrow money from a third party later to remedy her financial proble
ms.
What is more, supposedly to cover up for her fault, Atty. Virtusio executed a de
ed of sale covering her car in Milas favor rather than return the money she defal
cated. But, again acting with guile, she withheld possession of the car and tran
sferred its registration in the name of her children.
Atty. Virtusio is guilty by her above acts of gross misconduct that warrants her
suspension for one year from the practice of law.
QUESTIONS:
How did Atty Virtusio violate CANON 7 of the Code of Professional Respon
sibilities?
What criminal case did Mila Virtusio file against Atty. Grenalyn Virtusi
o for misappropriating the former's funds?