‘Sereno’s Piatco fees excessive, illegal’

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 A Mandaluyong City judge has ruled that the P15 million Chief Justice Maria Lourdes Sereno received as attorney’s fee for representing Piatco was unlawful. PHOTO BY EDWIN MULI

A Mandaluyong City judge has ruled that the P15 million Chief Justice Maria Lourdes Sereno received as attorney’s fee for representing Piatco was unlawful. PHOTO BY EDWIN MULI

A court has ruled that the fees received by Chief Justice Lourdes Aranal-Sereno and other lawyers employed by the government in pressing its case against the Philippine International Air Terminals Co. Inc. (Piatco), the builder of the Ninoy Aquino International Airport (NAIA) Terminal 3, were illegal.

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Judge Carlos A. Valenzuela of the Mandaluyong Regional Trial Court (RTC) Branch 213 declared as unlawful the P15 million given to Sereno, as well as the other fees paid to foreign and local legal consultants hired by the Philippine government.

In its decision promulgated on August 29, the court denied the government’s petition for recognition and enforcement of a foreign arbitral award because the hiring of legal consultants did go through public bidding.

The government, through the Department of Transportation and Communications (DOTC) and the Manila International Airport Authority, asked the court to recognize the final ruling of the International Court of Arbitration of the International Chamber of Commerce (ICC) in Singapore issued on May 10, 2011, by ordering Piatco to pay $6,009,351.66 in litigation expenses and attorney’s fees.

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 a judgment based on something illegal or immoral according to the views of the forum.”

“This court cannot condone such blatant and shameless violation of the Constitution and other mandatory or prohibitory statues,” he added.

As one of the lawyers hired by the government, Sereno, earned a whopping $336,287.66 or P15 million.

The foreign lawyers who were hired were from the White & Case LLP, Allen & Gledhill LLP, Rajah & Tan LLP and Drew & Napier LLC.

The local lawyers and consultants included Sereno’s mentor, retired SC Justice Florentino Feliciano, who earned $332,636.25.

But the court said the fees paid to the lawyers were excessive.

“This court found that the recognition and enforcement of the final award is contrary to Philippine law and public policy because the items comprising of the award i.e. the GRP’s (Government of the Republic of the Philippines) arbitration costs and expenses were incurred in violation of the provisions of the Constitution, relevant statutes and other rules promulgated pursuant to law governing government expenditures and government procurement,” it added.

“The GRP’s arbitration costs and expenses were incurred in violation of the Philippines’ public policy mandating public bidding and its long-standing policy against the incurrence of irregular, unnecessary, excessive, extravagant or unconscionable expenditures or use of funds and property by the government,” the court said.

It observed that the government “incurred its arbitration costs and expenses, be they legal fees or otherwise,” in violation of the Procurement Act or Republic Act 9184 and Government Auditing Code of the Philippines (Presidential Decree 1445).

“The fact the government failed to comply with the relevant statutory requirements before incurring such expenses, the bulk of which consists of private lawyers’ fees, and failed to abide by the public policy that government procurement be effected through public bidding, makes the arbitration expenses illegal and the contracts upon which they are based, void,” the court said.

It added that there was no appropriation for the hiring of lawyers and consultants in the General Appropriations Act, neither were the expenses audited by the Commission on Audit.

“In this case, as shown by the summary of costs and expenses incurred, the bulk of the arbitration costs and expenses were expended to engage the services of foreign law firms and legal experts. Evidently, the engagement of the foregoing requires the prior written conformity and acquiescence of the Solicitor General and the prior written concurrence of the Commission on Audit. It appears that the government never complied with those requisites,” the court said.

“There can, thus, be no doubt that the arbitration costs and expenses were not only irregular and unnecessary, these were also excessive, extravagant and unconscionable,” it added.

The Supreme Court in 2003 nullified Piatco’s contract to build NAIA 3 because of irregularities. Piatco sued the government before the ICC in Singapore to recover at least $565 million in damages.

The ICC, in July 2010 ruled that Piatco and its German investor Fraport AG violated the Philippines’ Anti-Dummy Law, which requires that operation, management and control of public utilities such as airports should remain with Filipinos.

It also ordered Piatco to pay the Philippine government over $6 million in costs of proceedings. The Singapore High Court upheld the ICC’s decision.

The Mandaluyong court ordered the government to pay P5 million to Piatco “by way of attorney’s fees plus costs of litigation.”

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33 Comments

  1. hey guys where did you get $36,287.66 = Ph 1.5 M ??

    pls. read line by line:
    Piatco was ordered to pay $6,009.351 x Ph 42 = Ph 252,392.74
    Sereno earned $336,287.66 x Ph42 = Ph 14,124,081.00
    local lawyers & consultants included Sereno”s mentor retired justice Florentino Feliciano earned $332,636.25 x Ph42 = Ph 13,592,722.00

    where did you get the figure mentioned above??

    • Ronito Ines Amigable on

      $36,000 multiplied by 43 = Php1,540,000; but if it’s really $336,000, then it’s almost Php15,000,000. Perhaps there was a misprint.

    • Edited na yong nabasa mo. Di mo napansin ang figure na nagkaroon ng 3 sa unahan ng dating figure.
      Mali pa rin ang figure mo sa $6,009,351.66 = USD6 million

    • Oops, everybody is having a hard time seeing the figures…myself included. Anyway, Sereno did get(according to the news clip above), $336,287.66 which is indeed about 15 million pesos….but still, it is about 1/2 of 1% of litigation and atty’s fees paid by PiatCo…Is 1/2 of 1% an excessive rate?

    • Damn, my calculator is acting up….Sereno got 5.6% !!! Now, I cannot say that it is ‘not’ excessive….

  2. veronica castro on

    Tapos, na to. uphold the ruling in Singapore. no more technicalities. otherwise no one will believe us from hereon.

  3. Why we don’t hear how much Ampatuan Lawyers got for their defense to the massacre
    In Maguindanao? Joemar shall make a report on this also. Then we will know if P1.5M paid to CJ Sereno is excessive.

  4. this person is out to put Sereno in a bad light. the ruling is against the government not Sereno. he is the media contact of one of the justices that has an axe to grind against sereno.

    • Ronito Ines Amigable on

      The reporter should go back to math class. $36,000.00 is only Php1.5 million, definitely not Php15 million.

    • $336,287.66 x P42.00 = P14,124,054.00.
      a bit odd that the lead counsel got less ( $332,636.25.) than CJ Sereno and yes the decision was centered on the consultants as a whole ad not just CJ Sereno. I guess thats because the story is more catchy with a known personality.

  5. Looks like there will be a new appointee to the Supreme Court or the Court of Appeals by the name of Carlos Valenzuela.

  6. Now we know it was 1.5 million & not 15 million do they still consider that to be excessive. That would be interesting to not, & another thing when writing an article try harder to get it right. A simple conversion from dollars to pesos is a mistake that should not have happened. But it seems no one re reads what they write on here & no one either checks it out, if someone else did check it out then maybe the wrong people are writing for the manila times. Or did you make that mistake on purpose to exaggerate how much was involved & think we the public are to dumb to notice a mistake like that.

    • …As one of the lawyers hired by the government, Sereno, earned a whopping $336,287.66 or P15 million.

      >>> $336,287.66 x Php42 per $1=Php 14.12 M.
      >>>$336,287.66 x Php 43 per $1=Php 14.46 M.
      >>> Where is Php1.5M came from ?

  7. $36,287.66 is .6% of $6,009,351.66….that’s .006. Just over 1/2 of 1%. Unless they have a standard for legal fees to private counsels, the amount paid is not excessive…And besides, it’s not really 15 million but in fact 1.5 million….This tirade against the SC is not healthy for this administration !

  8. “Excessive, extravagant, unconscionable.” When a resident Filipino citizen stands before a foreign Court to defend interest of the Philippine gov’t, does he not stand to be entitled to a rate at par with the lawyer of the opposing party in the litigation? Hahahahaha. If the adversary lawyer who is a foreigner stand to receive a 100 bucks in that litigation are we not to consider giving our own lawyer up to 100 bucks also? Or are we too stingy as to pay him a very much lesser amount of say 10 bucks because it would be in violation of our constitution and laws? HEHehe.

  9. Edgar G. Festin on

    Very good news story. But the writer and the Times editors ignore one of the Ws. Until the end of the story the reader still does not know exactly when it was that current Chief Justice Sereno and the other lawyers received the now-ruled illegal fees.

  10. Andy Macatangay on

    Looks like you got your math all wrong. The $36,287.66 is equivalent to P1.5 million, not P15 million as you reported.

    • Andy-how very correct you are! The figure $32,000+ has been repeated several times in the article and that amounts to around P1.5 million only. Not a very big amount indeed, like loose change only. We should not get worked up with the conclusions that are no logical at all.

  11. Coming right on the heels of the DAP decision , people might wonder if this could be a part of the president’s revenge against the Supreme Court, more particularly against CJ Sereno, or just an unfortunate coincidence.

    • Anong todas na, it’s vey obvious that those two Congressmen Farinas and Tupas and the rest of those who voted in the Kangaroo court impeachment (CJ Renato Corona) has lost all their credibility, because they could be bought by any amount of (bribed) money forgetting the welfare and interest of their constituents therefore all Filipinos must not re-elect them in order to remove them from their abusive power in Congress , based on exposure made by Benhur Luy of the Janet Lim Napoles are very good proof of their personal agenda. Those three Senators are in jail who were in cahoot with this President are paying dearly (karma, bigtime). . Walang na silang Dios na kinikilala, kundi pera.

  12. This decisions is highly suspicious. Why the decision came out only now when it should have been exposed before Lourdes Sereno was appointed Chief Justice. The, there were many who opposed and exposed the payoff to Sereno but the yellow media was silent, even defending Sereno. Now that Sereno is in bad graces with PNoy, this subject is now back in the open. I believe Boy mischief PNoy is again the autor of this development.

    • You’re right, and this President thinks that every Judge he appoints will abide by his personal( agenda) ways disrespecting the Constitution , Nope, those Justices must protect ,adhere and abide by the laws of the Philippine Constitution and as s long as CJ Sereno follow the law , she should not feel threatened by those greedy and mentally unfit sitting Congressmen and Senators whose priority is dangerously misplaced. God, save our beloved Philippines.

  13. The lavish fees must be returned and retrieved. In Canada, the 4 senators who are non-elected but appointed and who had abused their allowances were demanded to return the excessive expenses. Some of them, resigned. SC, Chief Justice Serena should return the money.

    • Returning the money is an admission of guilt. Would she? I doubt it. She’ll fight it tooth and nail like CJ Corona.

  14. Andres R. Samson on

    The proceedings took place under circumstances attendant to the case and fees were assessed at the going rate for such a litigation involving other nationals and professionals from other countries. Do we not have a basic fundamental problem in the assertion of this judge of the RTC? If anything unconscionable or rational action ought to be taken by the Court is for the Judge to show the way by which Sereno can be taxed accordingly by RPG for these humongous fees.

    • wait….ano ba talaga…prang maramii ang malabo ang mata…36,000 ba o 336,287 ang isinulat ng reporter? at ang reporter nag report lng nga facts….