CJHDevCo has no basis for TRO—BCDA: Court stops BCDA from taking over John Hay

BAGUIO CITY -- The bases Conversion and Development Authority has been prevented from taking over establishments, facilities and administrative offices of Camp John Hay Development Corp., developer of Camp John Hay Special Economic Zone in Baguio City.

Baguio City regional trial court executive Judge Iluminada Cabato issued on Jan. 24 an order preventing the takeover.

But the state-owned BCDA said Thursday the Sobrepena-led CJHDevco had no basis for securing a temporary restraining order (TRO) against a takeover of CJHDevCo’s leased properties in the John Hay Special Economic Zone because there was no attempt to take over the leased properties.

In the one-page order, Cabatu directed the BCDA “to cease and desist, for a period of 72 hours… from committing any act tending to wrest control and/or any portions thereof, including improvements thereon, from Camp John Hay Development Corp..”

The RTC held that the complainant “would suffer grave and irreparable injury” if the BCDA is not enjoined from taking over CJHDevCo’s establishments, particularly the management of Camp John Hay Golf Club, the Manor Hotel, the Camp John Hay Suites Hotel, its administrative offices, as well as key utilities and facilities, including its water source.

The RTC likewise enjoined the BCDA and other persons claiming rights to the leased property, “including forceful occupation or ejectment from the leased premises and/or the award of the rights in the leased property to a new entity.”

CJHDevCo earlier filed a complaint for mandamus seeking to compel the BCDA to comply with its contractual obligations as stipulated under the 2008 “restructuring memorandum of agreement (RMOA), particularly the setting up of the so-called “One-stop Action Center,” an effective mechanism that would facilitate development of the John Hay Special Economic Zone .

In a statement Thursday, the BCDA assailed CJHDevco announcement that it has secured a temporary restraining order against a takeover of CJHDevCo’s leased properties in the John Hay Special Economic Zone.

“As far as the BCDA is concerned, there is no legal basis for a TRO. No takeover has taken place, and no attempt has been made, hence the court order comes a surprise and mystery to us,” BCDA President and Chief Executive Officer ArnelPaciano D. Casanova said.

“They’re afraid of their own ghost which they created trying to evade their huge obligation to the government,” he added, pointing out that CJHDevCo’s grounds are speculative and born out of their own paranoia.

The BCDA chief executive stated that the delinquent lessee is “grasping at straws” to evade meeting their ballooning debt obligation. “CJHDevco still owes government P3 billion and we will not allow them to escape their debt.”

Judge Cabato issued the three-day TRO, based on CJHDevco’s allegations that the BCDA plans to "swiftly grab possession of the property in a matter of hours" and that "mere arithmetic cannot be used to compute the injury that CJH DevCo will suffer.”

Casanova questioned the “arithmetic” that was used in computing for CJHDevco’s P14.4 billion claim in damages, saying the numbers they presented are baseless and atrocious. “The numbers that cannot be disputed is their ballooning obligation to BCDA amounting to P3 billion and this is the continuing damage that the government is suffering”, Casanova stated.

“We are firm in our commitment to protect public interest in Camp John Hay,” Casanova said. BCDA has always taken the normal route in asking CJHDevco to pay its obligations. “It is CJHDevco which has been precipitate and unreasonable with its actions. What they are doing is grossly disadvantageous to government,” he added.

“Like all their past actions and statements, CJHDevCO has even misled the court, giving the impression that the firm is the victim, on the contrary, it is the government and the public who is suffering damage while CJHDevCo continues to benefit from John Hay without giving government its due,” he said.

“If the Sobrepena group had paid P3 billion debt, that amount could have gone to improving John Hay, and regional development, particularly in Baguio, shall have been supported many times over,” Casanova added.

Financial row developed owing to CJHDevco’s continuing refusal to pay its financial obligations as stipulated in the developer’s lease contract with the BCDA.

Without any advance notice to BCDA, the John Hay lessee unceremoniously kicked out four BCDA directors from the latter’s board of directors upon announcing that they rescinded the 2008 Restructuring Memorandum of Agreement (RMOA) earlier this month.

“They have no legal basis to unilaterally rescind the 2008 RMOA,” Casanova said, adding that they may “have shot themselves at the foot,” since there is no longer a working contract between BCDA and CJHDevCo.

A week after the rescission, CJHDevco officials have filed for arbitration and are claiming P14.4 billion in damages, desperately making it appear that they are the aggrieved parties.