CA voids eviction order vs John Hay developer, investors

MANILA, Philippines - The Court of Appeals (CA) has allowed the developer and third party investors of Camp John Hay to remain in Baguio City.

In a 67-page decision released yesterday, the former special fifth division of the appellate court voided the eviction order issued by Baguio City Regional Trial Court (RTC) Branch 6 against Camp John Hay Development Corp. (CJHDevCo) and over 1,600 investors in the 247-hectare former American recreational facility.

The RTC committed grave abuse of discretion in granting the bid of the state-run Bases Conversion and Development Authority (BCDA) to immediately enforce the arbitral award before the P1.42-billion compensation to CJHDevCo is fully paid, the CA said.

 “Pending the filing of the claim with the COA (Commission on Audit) and ...payment to CJHDevCo, the latter cannot be forced to vacate the leased property, consistent with the principle of mutual restitution,” according to the ruling penned by Associate Justice Noel Tijam.

The appellate court also barred BCDA from entering into new contracts with third parties or perform any action that would “contravene the tenor of the arbitral award before receipt of its payment.”

“These third parties invested their hard-earned money in the said buildings and improvements in good faith and acquired the same for value,” the ruling stated.

CJHDevCo was joined by third party investors CAP John Hay Trade and Cultural Center Inc., CJHGolf Club and a number of unit and property owners as petitioners and intervenors in the petition.

The third party investors claimed that their ownership rights are protected by a 50-year leasehold agreement they signed with CJHDevCo, which is valid until 2046.

Highly irregular

The BCDA said it would contest the CA ruling. It was “highly irregular” for a court to modify the final award of an arbitral tribunal, it said.

“We are studying our legal options on whether to file a motion for reconsideration or go straight to the Supreme Court... we will contest the patently erroneous decision of the CA,” BCDA head for legal services Peter Paul Andrew Flores said.

Flores said the suit filed by CJHDevCo with the CA was self-serving and meant to perpetuate its operations.            

He added that the final award is executory after all the parties accepted the judicial confirmation by the RTC.

Flores noted that the arbitral tribunal ordered CJHDevCo to vacate the leased premises and promptly deliver the leased property, inclusive of all new constructions and permanent improvements. – With Richmond Mercurio