CJHDevco claims BCDA owes it P1.42B


The Camp John Hay Development Corp. (CJHDevco) is now claiming that the Bases Conversion and Development Authority (BCDA) owes the company P1.42 billion in rental reimbursements.

In a statement, CJHDevco Chairman Robert John Sobrepeña said the BCDA has missed the fact that it was ordered by the Philippine Dispute Resolution Center Inc. (PDRCI) to return the rent paid by the company for over a decade.

Sobrepeña said they feel vindicated by the Arbitration Tribunal in upholding the position that CJHDevCo does not owe the BCDA P3.3 billion in back rentals.

“Instead, it was the finding of the Tribunal that it is BCDA which now owes us, CJHDevco, P1.42 billion as reimbursement for all our rental payments since 1996,” the statement read.

In a 274-page Final Award dated February 11, 2015, the three-man PDRCI declared CJHDevCo was “not liable for any unpaid back rent” and said it found both the BCDA and CJHDevCo of mutually breaching their contractual obligations, respectively, in the redevelopment of Camp John Hay in Baguio City.

“The Original Lease Agreement, the subsequent Memorandums of Agreement and the Restructuring Memorandum of Agreement of 2008 are hereby rescinded due to the mutual breach thereof by the parties. The parties are hereby reverted as far as practicable to their original position prior to the execution of the Original Lease Agreement,” the PDRCI ruled.

The arbitration center noted the BCDA failed to comply with its obligation to set up a One-Stop Action Center (OSAC), which would have been an effective mechanism to facilitate development of the John Hay Special Economic Zone.

“It is undeniable that the OSAC which the BCDA claims to have established in compliance with the 2008 restructured memorandum of agreement (RMOA), was unable to perform its warranties. For one, the OSAC was manifestly not fully authorized to process and issue developmental permits, such as tree-cutting, earth balling, and tree-pruning permits,” the ruling read.

The PDRCI also noted how BCDA failed to issue business permits even after the RMOA was put in place in 2008.

“From a review of the evidence submitted by the parties, this tribunal is not inclined to accept the reasons put forward by BCDA that allegedly justify why these permits could not be timely issued,” it added.

The BCDA earlier said it is studying its options on how the government can recover the P3.4-billion rent for Camp John Hay after the panel ordered CJHDevco to vacate the former US military facility.

The lawyers of CJHDevCo is now studying the legal options available within the parameters of the case.

Sobrepeña claimed the PDRCI has found the BCDA in breach of contract and CJHDevCo was absolved of any liability involving the supposed back rentals.

“Please note that the writ of preliminary injunction enjoining the BCDA from taking over Camp John Hay remains in full force and effect unless the court orders otherwise,” Sobrepeña claimed.

The rights and interest of those sub-leasing Camp John Hay, as well as the other sub-locators, would be protected and respected, Sobrepeña said.

BCDA earlier called on investors in Camp John Hay to work with the government in properly developing the major tourism and recreation center in Baguio.

“Whatever agreement they entered into with CJHDevco no longer applies because their subleases have been terminated with the principal lease,” BCDA president and chief executive officer Arnel Paciano Casanova said.

“CJHDevco has been ordered to vacate the property and they should do so immediately. We want to ensure the security in Camp John Hay and prevent sabotage, pilferage and the destruction of property,” he added.

CJHDevco, however, claimed the BCDA should follow the arbitration panel’s order.

“We hope when we turn over the Camp to BCDA after the P1.42 billion award is paid to us, BCDA will take care of the 480,000 trees we will leave behind,” Sobrepeña said.


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