John Hay developer says BCDA can’t take over yet

MANILA, Philippines - The developer of Camp John Hay in Baguio City insisted yesterday that the Bases Conversion Development Authority (BCDA) cannot just take over its operations based on last week’s ruling of the Philippine Dispute Resolution Center Inc. (PDRCI).

The Camp John Hay Development Corp. (CJHDevCo) said BCDA should first refund its rental payments since 1998 amounting to some P1.42 billion, as provided in the tribunal’s order.

CJHDevCo chairman Robert Sobrepeña stressed neither party can implement the PDRCI award without an order confirming it and a writ of execution being issued by the proper court.

“Please note that the writ of preliminary injunction enjoining the BCDA from taking over Camp John Hay remains in full force and effect unless the court orders otherwise,” Sobrepeña told reporters in Manila.

“We trust that, even with the issuance of the award, the parties will act in good faith and with due regard for the rights and interests of innocent third parties who are not involved in the dispute between CJHDevCo and the BCDA,” he pointed out.

Despite the legal battle, the CJHDevCo executive assured their sub-lessees and sub-locators in Baguio City’s major tourism and recreation center that their rights and interests would be protected and respected.

“The BCDA consented to all sub-leases within the camp when it expressly gave, in the lease agreement itself, CJHDevCo the right to sub-lease various areas and real estate inventory therein,” he said.

While the lawyers of CJHDevCo are currently studying legal options, Sobrepeña welcomed the PDRCI ruling.

He noted that the PDRCI has found the BCDA to be in breach of contract and CJHDevCo was absolved of liability for the supposed back rentals.

“We are pleased that the arbitral tribunal dismissed the BCDA’s claim for back rentals, which we have always maintained were never due,” Sobrepeña said in a press conference.

“We are also grateful that the substantial rentals the company paid in the course of over more than a decade, were ordered returned to CJHDevCo. But we would like to emphasize that we sought for arbitration,” he added.

In its 274-page final award dated Feb. 11, 2015, the three-man PDRCI declared CJHDevCo as “not liable for any unpaid back rent” after it found both the BCDA and CJHDevCo of mutually committing breach of their contractual obligations, in connection with the development of Camp John Hay in Baguio City. 

The PDRCI stressed that BCDA failed to comply with its obligation of setting up a one-stop action center (OSAC), which would have been an effective mechanism to facilitate development of the John Hay Special Economic Zone.

“It is undeniable that the OSAC which the BCDA claims to have established in compliance with the 2008 restructured memorandum of agreement (RMOA), was unable to perform its warranties.