MANILA, Philippines - The board of Camp John Hay Development Corp. (CJHDevco) has been cleared by the Department of Justice (DOJ) in an estafa case filed by the Bases Conversion and Development Authority (BCDA).
In a 36-page decision penned by prosecution lawyer Caterina Paeg of the DOJ that was released last week, CHJDevco board members were cleared due to the lack of evidence in their personal participation in the commission of estafa alleged by the BCDA.
BCDA had accused CJHDevco of estafa, claiming the developer incurred losses in 1999 when it in fact declared dividends to its board, allegedly resulting in foregone revenues to the BCDA.
CJHDevco explained it never asked to escape but only to defer payment of its second year lease, amounting to P425 million for the rental of Camp John Hay, a proposal that was accepted by the BCDA in a signed Revised Memorandum of Agreement.
The resolution of the prosecutor also enumerated the breaches committed by BCDA as relayed by the respondents, including failure to deliver clean possession to CJHDevco of 32 hectares of the leased property crucial to development; failure to demolish structures within the leased property necessary to turn-over effective control and possession of critical portions of the leased property; failure to enter into the necessary agreement with the Bureau of Customs to implement duty incentives within the John Hay Special Economic Zone; failure to assist CJHdevco in securing an Environmental Compliance Certificate (ECC) critical to its timely development.
According to Ferdinand Santos, CJHdevco lawyer and director the said breaches of contract by BCDA prevented the corporation from having true and effective possession of the leased property, which caused the company to request the agency for a deferment of payment.
CJHdevco argued that with these breaches, plus the Asian financial crisis in the last 1990s, it was practically impossible for the company sto meet its obligations, hence the need to ask for a deferment of the case.
“The board never asked to escape from our obligations to pay lease rentals to BCDA. But because BCDA was delayed in fulfilling its obligations, this had an effect on our development, hence we needed to ask for a deferment. This incident also happened in 1999, fifteen years ago, and the revised memorandum of agreement was approved by the BCDA board,†CJHdevco chairman Robert Sobrepeña said.
Meanwhile, the BCDA is awaiting the decision in the arbitration case that CJHdevco filed against BCDA in January 2012 that is expected to be released this month.
CJHdevco sued BCDA in the arbitration court for damages ranging from P5 billion to P10 billion.
The arbitration case was filed in January 2012 after the BCDA repeatedly refused to set up a One Stop Action Center (OSAC) that it committed to after the two parties signed a Revised Memorandum of Agreement (RMOA) in 2008. The RMOA came after a first arbitration case that was filed by CJHdevco against BCDA in 2005 was resolved.