A court maintained that legal fees paid by the Philippine government to lawyers it hired to handle its case against the Philippine International Air Terminals Co. Inc. (Piatco), the builder of the Ninoy Aquino International Airport (NAIA) Terminal 3, were excessive and illegal.
One of these lawyers was Chief Justice Lourdes Sereno, who, as legal researcher, received P15 million.
In a five-page order dated May 4, 2015 signed by Judge Carlos Valenzuela, the Mandaluyong Regional Trial Court (RTC) Branch 213 declared as unlawful the payments made to Sereno and other legal consultants. The Manila Times obtained a copy of the ruling.
Valenzuela junked a motion for reconsideration filed by the Office of the Solicitor General, saying no ground or issue was raised to prompt the court to overturn its ruling issued on August 29, 2014.
The government wanted the court to recognize the final ruling of the International Court of Arbitration of the International Chamber of Commerce in Singapore dated May 10, 2011 by ordering Piatco to pay $6 million in litigation expenses and attorney’s fees to foreign and local consultants. The amount represents 25 percent of the cost of arbitration.
Valenzuela said the court will not be a tool in allowing unconscionable attorney’s fees as “public interest dictates that the courts should not assist in the enforcement of judgment based on something illegal or immoral.”
“This court cannot condone such blatant and shameless violation of the Constitution and other mandatory or prohibitory statues,” he added.
The foreign legal firms hired by the government included White & Case LLP, Allen & Gledhill LLP, Rajah & Tan LLP and Drew & Napier LLC while local lawyers and consultants included Sereno’s mentor, retired SC Justice Florentino Feliciano, who earned US$332,636.25.
The court said the arbitration costs and expenses “were incurred in violation of the Philippines’ public policy mandating public bidding and its long-standing policy against irregular, unnecessary, excessive, extravagant, or unconscionable expenditures or use of funds and property by the government.”
It added that aside from lack of public bidding, there was also no appropriation for the hiring of the lawyers and consultants nor auditing by the Commission on Audit.
“There can, thus, be no doubt that GRP’s arbitration costs and expenses were not only irregular and unnecessary, these were also excessive, extravagant and unconscionable,” the court said.
GRP stands for Government of the Republic of the Philippines.