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Sta. Cruz dept store fights light rail over lease

[ ] January 1-2, 2011
by Macon Ramos-Araneta
THE Light Railway Transit Authority will go to court later this month in a bid to evict Isetann Department Store from its property in Sta. Cruz, Manila.
Manila Regional Trial court Judge Silvino Pampilo has set a pre-trial hearing of the case for Jan. 24, even as mediation efforts continue. Based on court records, only the plaintiff, Isetann, has submitted a pre-trial brief to oppose the eviction.
The department store said it was open to an amicable settlement “on reasonable terms,” but did not specify what these terms might be.
In its pre-trial brief, Isetann enumerated the issues that needed to be settled, including a chain of lease and sublease agreements between the LRTA and the Philippine General Hospital Foundation Inc., the foundation and sub-lessor Joy Mart Consolidated Corp., and Joy Mart and Isetann.
The foundation is the sub-lessor of the 1,461.7-square-meter land owned by the LRTA, which it leased to Joy Mart as a sub-lessee for a monthly rental of P199,710 for 25 years, renewable for another 25 years on terms acceptable to both.
Under a deed of assignment, Joy Mart assigned in favor of Isetann all its rights, interest and participation under the sub-lease agreement between the foundation and Joy Mart on Feb. 1, 1984.
For the duration of the sub-lease agreement, Isetann invested P53 million in the LRTA property by building a multi-story commercial building with centralized air conditioning, eight escalators, two cooling towers, five industrial air conditioning units, two elevators, store and office furniture and fixtures, and a generator.
Isetann also employed more than 400 people, including agency employees, to conduct its retail business.
Isetann claims it will lose P1 million a month if the LRTA succeeds in evicting it.
In March 1985, then LRTA administrator Jose Sembrano asked Joy Mart to remit rent directly to the LRTA instead of to the foundation.
In April 1986, then LRTA chairman Hernando Perez informed Isetann that the agreement between LRTA and the foundation had been canceled, and again asked Joy Mart to pay rent directly to the LRTA.
On Jan. 12, 2009, Joy Mart sent a letter to the LRTA seeking an extension of its sublease agreement, which was to expire on Aug. 30, 2009. The company paid its monthly rentals for the extended period of six months, from September 2009 to February 2010, but on Aug. 10, 2009, the LRTA sent Joy Mart a notice that the sublease agreement was about to expire and would not be renewed.
A notice to vacate was sent to Isetann by then LRTA Administrator Melquiades Robles on Jan. 28, 2010. Robles reiterated the LRTA’s decision not to extend the sublease agreement between the foundation and Joy Mart, and told Isetann to vacate the property on or before February 2010.
The LRTA said it planned to bid out the property now occupied by Isetann, but Pampilo, through a preliminary injunction on March 15, 2010, stopped Isetann’s eviction. He also ordered Isetann to post P300,000 bail.

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