Monday, August 4, 2008 | MANILA, PHILIPPINES
A PASIG TRIAL court has ordered state-owned Clark Development Corp. (CDC) to honor its lease contract with two private firms, saying the award to other parties had been grossly disadvantageous to the government.
In a 12-page order, the court said the lease offer of Anteva Group Corp. and New Kanlaon Construction, Inc. was more competitive than the one given by Fontana Development Corp. and BB International Leisure & Resort Development Corp.
"This court cannot close its eyes into allowing... a contract that... is so brazenly anomalous as it is grossly disadvantageous to the government," the court said through Judge Rolando G. Mislang.
It added that it had to actively prevent graft and corruption from further eroding public trust in the government "in the face of a series of anomalies that has continuously rocked the present administration."
The court noted that Anteva and New Kanlaon had offered a lease price of 10 cents per square meter per month for 336 hectares of land that it wanted to develop into a residential and resort community.
In contrast, Fontana and BB International offered a rate of 0.75 to 1.4 cents.
Former CDC President and Chief Executive Officer Levy P. Laus declined to comment on the ruling. He said they would reiterate the argument that "there was never a de facto approval of the lease agreement."
"We entered into the project in good faith," Fontana Spokesman Peter Sing said in a text message.
The court order prevents Fontana and BB International from developing around 94 hectares — the size of about 232 football fields — of their individual projects that overlap with those of Anteva and New Kanlaon.
Court records showed that while the Anteva Group was trying to enter into a deal with CDC, the latter had decided to enter into a lease agreement with Fontana and BB International.
The Anteva Group was already in talks with the agency as early as May 31, 2006 for the development of areas within the free port zone.
A proposal that tried to meet CDC requirements, including the 10-cent lease rate, was submitted on Oct. 24 of that year.
After a month, however, the government corporation rejected the group’s proposal. Several dialogues were sought, but CDC chose not to act.
The Anteva Group later found out that CDC had entered into a lease deal with its rivals.
Fontana’s 80-hectare project supposedly "demolished" its claim, while BB International’s 300-hectare project encroached on some 14 hectares of its proposed project.
In suing CDC and its rival companies, the Anteva Group said it had incurred substantial costs while waiting for more than a year for the project to be consummated. But CDC has dismissed its claims, saying the lease agreement had never been formalized.
Favoring Anteva, the court said it was not persuaded by the government firm’s argument that the lease deal with Anteva was "unenforceable."
"There has been a meeting of the minds borne out by the fact that there undeniably was a period of more than one-and-a-half years of a series of negotiations," the court said. Those talks led to the plaintiffs’ final proposal, which was submitted after CDC made known its preferred terms and conditions, the court said. — I.P. Pedrasa