Daphne J. Magturo | April 08, 2015
A LOCAL court has confirmed an arbitration tribunal’s decision on the Sobrepeña group’s row with the government over Camp John Hay and ruled that existing tenants and locators will not be evicted.
In a decision dated April 7, the Regional Trial Court of Baguio City said: “The Final Award is clear. It needs no further interpretation.”
“As to the list of sublessees and/or vested right holders, they will be governed by the law on obligations and contracts,” read the document, penned by Acting Presiding Judge Cecilia Corazon S. Dulay-Archog.
In 2012, state-run Bases Conversion and Development Authority (BCDA) and developer Camp John Hay Development Corp. (CJHDevCo) sought arbitration with the Philippine Dispute Resolution Center, Inc. after the latter failed to meet its financial obligations to the agency.
In February this year, the tribunal issued a final award and rescinded the original lease agreement “due to the mutual breach” by both parties. It ordered CJHDevCo to return the property to BCDA, while BCDA was asked to return P1.42 billion in rentals paid by the developer.
This has prompted BCDA President and Chief Executive Officer Arnel Paciano D. Casanova to say in the same month that “whatever agreement they (investors) entered into with CJHDevCo no longer applies because their subleases have been terminated with the principal lease.”
But yesterday, CJHDevCo said the agency cannot just cancel the agreements because the tenants are protected by law as they are buyers in good faith.
“Article 1385 of the Civil Code, which is the law relied upon by the vested rights holders, provides that an ‘order for mutual restitution’, as in this case, cannot include properties currently in the possession of third persons who acted in good faith,” CJHDevCo Chairman and Chief Executive Officer Robert John L. Sobrepeña told a media briefing yesterday at the Marco Polo Hotel in Ortigas district.
The Camp John Hay Economic Zone has a total of 1,631 existing locators, sublessees and tenants, the developer said in a statement yesterday.
“The third parties who acted in good faith are not affected by the [tribunal’s] decision. Once CJHDevCo leaves, ang kausap na ng lessees ay BCDA -- BCDA steps into the shoes of CJHDevCo for the remainder of the lease contract,” Gilbert Raymund T. Reyes, CJHDevCo’s legal counsel, explained in the same briefing.
The lease agreement will expire in October 2046.
“We will offer our law firm and we will pay for the legal fees to ensure that our tenants’ rights are protected,” he added.