THOSE familiar with the legal travails of the Bangko Sentral ng Pilipinas (BSP) know how much headache bank regulators have had in the many years that they have been trying to go after businessman and former banker Jose Go, whose Orient Bank collapsed in the 1990s.
Well, it now seems that that headache is no longer exclusive to the BSP.
We learned recently that United Coconut Planters Bank (UCPB) has been struggling with its own issues in going after some assets presently under the control of Go, who is also a former “mall magnate.”
Here’s the story.
In 2005, UCPB initiated the filing of three cases for unlawful detainer with damages (meaning that certain properties are being held by another party without a legal right to do so) against a Go-controlled firm called Superfriend Holdings Inc. with the Metropolitan Trial Court of Makati City.
The bank properties in question are the Gotesco Caloocan Annex, Manila Plaza and Gotesco Corporate Center—all owned by UCPB and leased by Go, presumably with ownership changing hands after the latter ran into financial trouble.
In 2006, the court granted UCPB’s plea and ordered Go’s Superfriend Holdings to pay its rental arrears and to vacate the leased premises. But then, Superfriend Holdings appealed the decision with the Regional Trial Court of Makati City, which then sided with Go and reversed the other court’s decision.
So UCPB ran to the Court of Appeals, which, in 2009, agreed with the bank. It issued a resolution ordering the Makati RTC to “conduct proceedings without delay.” This time, the Makati RTC ordered Superfriend Holdings to return the three properties to UCPB and pay them back rentals totaling (as of 2011) P270.4 million and advances for expenses.
Naturally, Superfriend Holdings appealed the Court of Appeals’ decision … but was promptly shot down by the court. Well, maybe not that promptly, as this decision was made last year.
Soon after that, Superfriends filed a motion for reconsideration, which was again denied by the appellate court.
What’s next? As expected, Superfriend Holdings filed an appeal with the Supreme Court—its last ace, so to speak. Unsurprisingly, even the Supreme Court (through its second division) denied the appeal for lack of merit. The high tribunal also pointed out that this was clearly being done only to delay the execution of the earlier decisions of lower courts.
Well, a few months later Superfriends filed a motion for reconsideration, and instead of denying it outright—voila!—the high tribunal asked UCPB to comment on the motion of the Go firm.
Apart from the 10-year legal delay, it should be no big deal, right?
Well, here’s the thing: UCPB is now worried about this case because one of the Supreme Court justices was known to have been a borrower of Go’s Orient Bank in the 1990s. It is unclear whether this loan has been repaid or not since the bank had already collapsed.
And UCPB’s lawyers are also scratching their heads as to why this particular justice was involved in the decision when he is a member of another division of the Supreme Court.
Oh well. Daxim L. Lucas
PPP solution
THE AQUINO administration’s public-private partnership (PPP) infrastructure program has lately been thriving, thanks to the healthy participation of domestic conglomerates. But what about the foreign players?
Their minimal participation, thus far, was explained recently by San Miguel Corp. president Ramon S. Ang, who noted that foreign players indeed wanted to come in via partnerships with local counterparts—except the terms weren’t always attractive for Filipino companies.
Recounting San Miguel’s experience, Ang said they were continuously approached by foreigners for ventures. But a deal almost never happens because of the many requirements.
“They want a 20-percent return on their investment, they want exit mechanisms, put options,” Ang told a business forum organized by Euromoney last week.
He said San Miguel was fortunate to have enough resources to turn down such deals, but he noted that smaller companies might have no choice, and this could cause problems in the partnership or project itself moving forward.
The government, given the large size of future PPP deals, knows that foreign players will eventually have to enter, and for Ang, this is but an obvious consequence if local players are successful.
“If foreign companies see that Filipino companies are doing very well, making money, then naturally all foreign companies will come,” he said. Miguel R. Camus
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