• Small people rising

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    Everywhere , aggrieved citizens are not taking their sad state of affairs siting down and doing nothing.

    Netizens have been posting photos of Napoles’s daughter—her P500,000 bags and P9 million Porsches . And using the social media to encourage others to direct their rage and revulsion at so much corruption and Gilded Age lifestyles.

    Commuters are planning a class suit to sue Francis Tolentino and whatever banana republic he represents over the bungled effort to impose 19th and 20th century traffic decongestion measures in a 21st century environment . Why are the major roads being cleared of mass transport to give ample revving room for the Porsches of Napoles’s daughter and the like, irate commuters have asked.

    In the social and political realms , the small people are crying “foul” and taking action and getting back on the sources of their misery. And the better news is this: Small investors who feel they have been shafted in tilted, one-sided arrangements no longer sulk and wallow in their misery. They are now small activist investors seeking relief though the courts. Carl Icahn-lite, we can call them that. Not the corporate-raiding Icahn but the Icahn fighting for the rights of investors against complacent/smug/negligent listed corporations .

    A case in point of the new-found activism of small investors is the suit for damages filed by hundreds of irate small investors of the struggling Uniwide Group who acquired shares in the company’s 1996 initial public offering (IPO) with great hope and expectations . And who are right now seeing their dream of getting something back from their investments in tatters. The case is now with the Paranaque RTC.

    The small investors who filed the case realized that while the collapse of the Uniwide Group was mainly due to the severe financial crisis that struck the Asian region in the late 90s, other factors such as greed and fraud were in full play . And the other factors that helped bring Uniwide down , which were distinct and separate from the impact of the Asian financial crisis , were itemized in their court case, a derivative suit for damages.

    The main beef of the small investors : a development company called Manila Bay Development Corporation (MBDC), a partner of Uniwide Group in the massive development of the Manila Bay Coastal Mall, duped Uniwide into signing a one-sided agreement that unilaterally favored MBDC. An agreement that also greatly prejudiced the small investors that pooled their life savings to buy Uniwide shares at the initial public offering .

    In the court case, the small investors claimed that the area leased by the MBDC to Uniwide for the coastal mall project was whittled down from the original 20 hectares to 10 hectares without prior notice . The downsizing of the leased area forced the Uniwide Group to return P400 million to investors who advanced money for the mall project on the expectation that they can lease vast spaces within the mall.

    The MBDC was fully aware that a massive road development project , now called the Diosdado Macapagal Blvd., would cut through the coastal mall area , but did not raise the issue with Uniwide. This further reduced the area allotted for the mall.

    The 20-year lease signed between MBDC and the Uniwide Group for the coastal mall project was littered with onerous terms all in favor of MBDC , according to the case. The MBDC was able to push for such onerous and lopsided agreement, according to the small investors, because former Uniwide officials conspired with the MBDC to craft such an agreement .

    The small investors claimed that all through the financial nightmares of the Uniwide Group, even when the Uniwide was placed under a SEC receivership, the payment of full rentals plus other charges and impositions was unhampered . The recovery of the P381 million , the rental fees so far paid by the Uniwide Group to the MBDC, is the first monetary relief sought by the small investors in the court case.

    The small investors claimed that the lopsided nature of the agreement between MBDC and the Uniwide Group was apparent in the many other provisions . The 20-year lease was without a renewal clause. There was no moratorium on lease payment during the construction stage. The 20-year lease was , in reality, a 19-year-lease.

    The usual features of a fair and equitable lease agreement were mostly missing in the MBDC-Uniwide lease agreement, according to the small investors.

    The small investors told the court that their investments would find relief with an extension of the lease agreement —a lease extension that would boost the rehabilitation and recovery of Uniwide. And the payment of P100 million in damages to Unwide, a payment that would redound to the benefit of the small investors.

    Their case , judging by the numbers, is not a penny ante damage suit but a real clamor for monetary relief from the alleged offending party—the MBDC.

    Will the case triumph? Will the small investors get their day in court? While we can’t speculate on the outcome , one thing is certain. Aggrieved small investors are no longer nursing their wounds and wallowing in self-pity. They now act to seek redress for their perceived loss and grievances . A case of small investors rising.

    mvronq@yahoo.com

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