PONCE VS. LEGASPI

PONCE VS. LEGASPI

FACTS: Petitioner Ponce and husband Manuel, owned 43% of the stockholdings of L'NOR Marine Services, Inc. (L'NOR). 48% of it was owned by the spouses Porter.The allegations of petitioner states that during the time while respondent Legaspi is the legal counsel of L’NOR, there occurred fraudulent manipulations by spouses Porter and other officers; that with the aid of Legaspi, they incorporated the Yrasport Drydocks, Inc. which was done to compete with L’NOR but still used the office space, equipments and goodwill of L’NOR. On account of flagrant frauds committed by Porter, a charge for estafa was filed where Legaspi appeared as counsel for Porter; that complainant asked Legaspi to take steps to protect L’NOR but the latter refused. Complainant filed for disbarment against Legaspi which was dismissed. Legaspi subsequently filed a complaint for damages against petitioner which was granted by the lower court and affirmed by CA.

ISSUE: W/N the complaint for damages by Legaspi is justified.

RULING: Decision reversed and set aside.

RATIO: While generally, malicious prosecution refers to unfounded criminal actions and has been expanded to include unfounded civil suits, the foundation of an action for malicious prosecution is an original proceeding, judicial in character. A disbarment proceeding is, without doubt, judicial in character and therefore may be the basis for a subsequent action for malicious prosecution. However, malice and want of probable cause must both exist in order to justify the action. In the case at bar, in the mind of petitioner, the act of the respondent in appearing as counsel for Porter, who had allegedly swindled L'NOR, the interest of which he was duty bound to protect, constituted grave misconduct and gross malpractice. Since the petitioner, however, was of the honest perception that YRASPORT was actually organized to appropriate for itself some of L'NOR's business, then we find that she had probable cause to file the disbarment suit.
Atty. Legaspi may have suffered injury as a consequence of the disbarment proceedings. But the adverse result of an action does not per se make the action wrongful and subject the actor to make payment of damages for the law could not have meant to impose a penalty on the right to litigate. One who exercises his rights does no injury. If damage results from a person's exercising his legal rights, it is damnum absque injuria.

*Mia