MANILA - The Supreme Court (SC) reprimanded two lawyers in an administrative complaint filed by the Home Guaranty Corporation (HGC).

HGC is a government-owned and controlled corporation that takes the risk out of private investment in housing by providing risk covers and fiscal incentives to housing credits extended by developers, banks, and other financing institutions.

The agency sought the disbarment of lawyers Lamberto Tagayuna and Elmar Panopio in 2015, citing conflict of interest and failure to return 53 owners' titles by the lawyers' firm which represented a collection agency handling HGC's non-moving, inactive, and past due receivables.

HGC claimed conflict of interest since Tagayuna was also president of Blue Star Construction and Development Corp. (BSCDC) which in 2012, initiated an arbitration case against HGC.

The 11-page resolution made public on Wednesday stated that Tagayuna and Panopio were only handed a stern warning that a repetition of a similar offense shall merit a heavier penalty.

The accused lawyers claimed the collection agreement was already expired when BSCDC filed the arbitration case against HGC and that they were merely exercising their right to withhold some documents since HGC still owed their law firm and the collection agency legal fees amounting to PHP846,212.

The SC said the requisites to exercise lien by a lawyer over his client's papers and properties were not met.

"It is essential that the client consent to the application of its property to the unpaid fees because a lawyer cannot unilaterally appropriate his client's property," the court said.

"Here there is no proof that HGC consented to the respondents' withholding of the titles to satisfy the unpaid legal fees. Thus, the court finds that respondents (lawyers) improperly exercised its right to retain HGC's documents as lien," the SC further said.

The other accused, lawyer Jose Gangan, has died, while lawyer Renato de Pano Jr. was earlier cleared as he had already resigned from the law firm when the incident occurred. (PNA)