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Philforest land deal axed in 2011—Palace

Paje: Lozada allegations without basis

By , Gil C. Cabacungan

A 2009 deal between Philippine Forest Corp. (Philforest) and a company owned by a brother-in-law of Executive Secretary Paquito Ochoa Jr. on the lease of 2,000 hectares in Busuanga, Palawan province, was scuttled two years later, Malacañang said on Tuesday.

Former whistle-blower Rodolfo “Jun” Lozada Jr. insinuated the Aquino administration had retained the deal hatched in November 2009  between Philforest and New San Jose Builders Inc. (NSJBI) because of the latter’s ties to Ochoa.

NSJBI is a real-estate company owned by Jose “Jerry’’ Acuzar, who is married to Ochoa’s sister.

The Economic Productivity Out of Idle Lands (Epil) agreement involved the lease of 1,999.9 hectares of forest land and beach-front property in Busuanga.

“It’s been canceled. It was canceled in 2011,” deputy presidential spokesperson Abigail Valte announced in a Malacañang briefing. She later furnished reporters a copy of the notification of the contract termination.

10 awardees

The NSJBI was among the 10 firms that were awarded contracts to develop parts of 40,000 hectares of pasture and grazing land in the Busuanga and Coron municipalities that then President Ferdinand Marcos assigned to the Yulo King Ranch in 1978 through Proclamation No. 1387.

Philforest president Erwin Krishna Santos wrote NSJBI president Felicisimo Isidoro on Dec. 9, 2011, informing him that the agreement was “considered effectively terminated” 60 days after reception of the notice.

Santos, who was recently suspended indefinitely because of Philforest’s involvement in the pork barrel scam, said the state firm had not received any project development plan from the real estate company despite several communications.

The real estate company had not undertaken any activity or improvement in the leased area covered by the Busuanga Pasture Reserve from the signing of the contract on Nov. 17, 2009, and onward, he said.

This constituted “abandonment” of the project, Santos told Isidoro.

Lozada, a former Philforest president, took President Aquino to task for not canceling the agreement, contrary to his promise to rescind all agreements signed by his predecessor, then President Gloria Macapagal-Arroyo, in the final weeks of her term.

Lozada also claimed that this was disadvantageous to the government because the original annual lease of P500 per hectare was reduced to P100 per hectare for unknown reason.

“The real test of daang matuwid (straight path) in this particular case is not whether the agreement was canceled or not. The right question is why Presidential Proclamation No. 2057 [Arroyo issued it on May 7, 2010] has not been recalled,” Lozada said.

The proclamation authorized Philforest to administer the development of idle lands covered by the pasture reserve indicated in Marcos’ Proclamation No. 1387.


Cancellation explained

Valte said the President saw no need to call Ochoa’s attention because he was aware of the details of the contract.

“The President already knew about this,’’ she said.

Valte said that when Mr. Aquino assumed office in June 2010, the government could not unilaterally rescind the contract “without cause.”

“But they did not comply with the terms of the agreement, their attention was called. And when they did not comply, the Epil agreement was terminated,” she said, by way of explaining Philforest’s notice of cancellation.

Valte said the cancellation should quash insinuations that the contract was retained in 2010 because of Acuzar’s ties to Ochoa.

“I understand that the meat of the allegations was that undue benefit was given to someone who is related to the executive secretary. The facts will bear it out that the Epil was given in 2009, in November of 2009. When they did not comply, the Epil agreement was terminated,” she said.

Paje’s order

As early as December 2011, Environment Secretary Ramon Paje had ordered the Philforest board to terminate the contract with NSJBI and nine other awardees—Green Busuanga Inc., Cebu Luneta Seafarers Center Inc., Oxenland Inc., Sorentomines Inc., Sardonyx Resources International Inc., Agristruction Inc., Slopes and Peaks Development Corp., Maricaban Realty Development Corp., and BGC Enterprises Inc.

Paje issued the notices of termination after Santos told the board that the 10 awardees had failed to submit their latest project development plans despite “several notices and that based on periodic inspections, no activities and improvements were found/introduced thereby constituting abandonment of the project.”


Osmeña letter

The termination was made two months after Sen. Sergio Osmeña III, in an Oct. 20, 2011, letter to Commission on Audit Chair Ma. Gracia M. Pulido-Tan, asked the COA to conduct a special audit on the implementation of the Epil agreement.

The results of the special audit, similar to the review of the pork barrel released by Philforest to dubious NGOs from 2010 to 2012, have yet to be released.

Based on a briefing paper on the case obtained by the Inquirer, Philforest was questioned for its failure to give the awardees a chance to plead their case before the termination of their contracts.

Termination protested

A number of awardees protested the termination, claiming that the contract did not stipulate the need and the deadline to submit a project development plan and that its absence warranted merely a suspension and not termination.

The awardees also argued that the notices of termination cited the “abandonment of the area” and not “abandonment of the project” as the basis for the termination.

When the Aquino administration took over, Philforest asked all awardees to update their contracts in June and August 2010.


Paje memo

Paje issued a memorandum dated October 2011, directing Santos to undertake appropriate actions to exercise its rights, specifically its right to terminate in case of abandonment of the area or failure to exercise the privileges under the contract.

Some awardees submitted their development plans shortly after getting the cancellation letter—NSJBI and Cebu Luneta on Dec. 16, 2011, and Agristruction on Dec. 29, 2011.

The NSJBI claimed that it had submitted a development plan as early as Dec. 18, 2009, and that it was received by Philforest on Aug.  31, 2011.

One awardee appealed the termination. Sorentomines claimed that it could not finalize a plan because it had yet to gain control of the area from informal settlers. Another awardee, Sardonyx,  claimed that it had yet to get hold of the termination notice .

Despite these protests, Philforest maintained that all of these contracts were “canceled or terminated,” said the briefing paper made in April.


Valte believed Lozada revived these allegations because he was rebuffed when he sought the President’s help in his case.

“(W)hen he met with the President, there was a pending case against him because, apparently, during his stint as Philforest president, he had it in his power to grant a lease to certain individuals, and he is alleged to have granted one to his brother-in-law. That is why there are charges against him,” she said.

“So, it’s very simple, if he went to the President and he asked for help and help was not given, assistance, the way that he wanted was not given, then this is obvious where he is coming from,” she added.

Present evidence

Valte said the President had advised Lozada in their meeting to present evidence to back up his case.

“The President told him as much.  ‘If there are allegations against you—anyway it’s in court—then it can be properly ventilated there,’” she said.

Lozada was ordered arrested in May by the Sandiganbayan over a graft case filed by Santos. Lozada complained that he had been forgotten and abandoned by the Aquino administration.

Sr. Mary John Mananzan of the Association of Major Religious Superiors of the Philippines said she was “disillusioned” with Mr. Aquino because he was “dismissive” of Lozada in a Feb. 18 meeting in Malacañang.

But the President had said he could not intervene in the case.  He said Malacañang had asked Lozada to list down the documents he needed to retrieve from Philforest to clear his name, but he had not done so.

 ‘Recycled accusations’

Paje on Tuesday described Lozada’s allegations as a recycled collection of accusations that have no basis.

“Documents will show that the statements of Mr. Lozada are inaccurate,” he said in a statement released by his office last night.

“We have already answered all these allegations; as we stated before when Mr. Lozada repeatedly brought up this issue, all the Economic Productivity Out of Idle Lands agreements referred to by him, including the 2,000 hectares awarded to New San Jose Builders, were canceled in 2011,” Paje said.

In the statement, Paje said Santos’ relief had nothing to do with the Epil agreements but “in light of ongoing inquiries into the possible involvement of Philforest in the Priority Development Assistance Fund scam.

“I have already recommended the abolition of Philforest, as its functions can be absorbed by the Department of Environment and Natural Resources’ corporate arm, the Natural Resources Development Corp., or its Forest Management Bureau,” Paje said. With a report from DJ Yap

Related Stories:

Lozada breaks down, hits Aquino’s ‘blind eye’ to chief aide’s deals

What Went Before: Marcos issued decree giving land to cronies

Lozada ties Ochoa to Philforest row

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Tags: Busuanga , Erwin Krishna Santos , Jerry Acuzar , Jose Acuzar , Jun Lozada , Ma. Gracia M. Pulido-Tan , New San Jose Builders Inc. , NSJBI , Palawan province , Paquito Ochoa Jr. , Philforest , Philforest land deal , Philippine Forest Corp. , pork barrel scam , Rodolfo “Jun” Lozada Jr.

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