LE

LEG AG
L AELT E
HT H SI C S
IC

CASE TITLE: 18. Hornilla vs. Salunat

GR NO/DATE: A.C. No. 5804 | July 1, 2003

Facts: Benedicto Hornilla is a member of the Philippine Public School Teachers

Association (PPSTA). Along with several other complainants, Hornilla filed intra-
corporate cases before the Securities and Exchange Commission (SEC) against
PPSTA board members for unlawful spending and the undervalued sale of real
property.

Atty. Ernesto Salunat on the other hand is a member of the ASSA Law and Associates,
and a retained legal counsel of PPSTA. As retained counsel, he represented PPSTA in
the cases against them by Hornilla and other members.

Hornilla alleged that Atty. Salunat is laboring under conflict of interests for engaging with
PPSTA, where his fees are derived from the corporate funds that its members, including
himself, contributed on.

Atty. Salunat refused to withdraw his representation despite being told by PPSTA
members about the conflict of interest. For his part, he contends that his representation
was in behalf of ASSA Law and Associates, being the retained legal counsel of PPSTA,
and not under his personal capacity.

Issue: Whether or not Atty. Salunat is indeed representing conflicting interests for

representing members of the same corporation in a derivative suit?

Held: Atty. Salunat is found guilty of representing conflicting interests. Engaging as

counsel for a corporation and representing part of its members in a derivative suit would
normally give rise to a conflict of interests.

Since this is still his first offense, Atty. Salunat is admonished to observe a higher
degree of fidelity in his professional practice, and is further warned that a repetition of
such act will be dealt with severely.

1|Page
MARIANO MARCOS STATE UNIVERSITY
COLLEGE OF LAW DLS – SY1920