Rallos heirs won’t pay bond, unfazed if auction cancelled

Barring last minute interventions, the likelihood of a public auction of a 9.7 hectare lot in the South Road Properties (SRP) tomorrow appears dim for the heirs of the Rev. Fr. Vicente Rallos.

The heirs decided not to pay the P1.2-billion indemnity bond sought by Filinvest Land Inc.

Roy Rallos said their counsel found out it inappropriate to yield to the demand of Filinvest, a third party claimant.

“We agreed that we don’t have to pay the bond sought by a third party claimant. Filinvest should direct its demand to the Cebu City government, not to us,” Rallos told Cebu Daily News.

He said the family doesn’t have a transaction with Filinvest.

“The case is between our family and the city government,” he added.

Sheriff Eugenio Fuentes gave the Ralloses until today to pay the P1.2 billion bond or tomorrow’s auction won’t push through.

The amount will be set aside in case Filinvest seeks legal action in the future.

The P1.2 billion represents Filinvest’s development costs for the lot, part of a P25-billion joint venture (JV) agreement with Cebu City.

Last Friday, the Ralloses submitted a letter to Fuentes, informing the sheriff that they won’t give in to Filinvest’s demand.

Fuentes said the court will settle the issue between the third party claim of Filinvest and the land developer’s P1.2 billion indemnity bond.

Cebu City Attorney Joseph Bernaldez said tomorrow’s auction will definitely not take place with the refusal of the Ralloses to pay the bond sought by Filinvest.

“Whether we like it or not, the city will get affected if the lot at the SRP will be auctioned off,” he said.

In case the auction will take place, Bernaldez said they will question its legality.

The city government is banking on a letter of Commission on Audit regional director Delfin Aguilar.

He said Aguilar cited that “the issuance of the writ of execution for the satisfaction of the money judgment against Cebu City may be deemed beyond the power of the court.”

COA ruled that a notice of garnishment of government funds needs prior  clearance from state auditors.

Bernaldez said the city government will also seek the issuance of a temporary restraining order (TRO) from the Court of Appeals in case the SRP lot is subjected to auction.

As of yesterday, he said the city hasn’t received word that the auction won’t push through.

Bernaldez said Filinvest has all the right to file a third party claim since the auctioned lot is part of the joint venture deal between the city and the land developer.

“Anyone can file a third party claim as long as they have interest on the property,” he said.

The city government and Filinvest entered into a joint venture agreement to develop 50 hectares of the 300-hectare SRP into a central business district in 2009.

Part of the agreement required Filinvest to purchase 10 hectares and pay the city P1.5 billion within the first three years.

Rallos said they have enough money to satisfy the claim of Filinvest.

However, he said they need not pay for a claim which is inappropriate.

“We are willing to pay the P1.2 billion bond. We can even raise more than what is being demanded by Filinvest,” Rallos said.

However, he said eight of the family’s lawyers advised them not to give in to Filinvest’s claims.

Rallos said they opposed the third party claim of Filinvest.

“It’s alright if Tuesday’s auction will not take place. Anyway, there is still a court hearing schedule on the 20th of December,” he said.

Rallos said they just to wait for the ruling of the court on the matter.

However, the Ralloses may have to wait for awhile since the Regional Trial Court (RTC) Judge James Himalaloan decided to inhibit from handling the case.

Rallos said they are willing to wait for the court to resolve pending issues.

“We are not in a hurry,” he said. He said the debt of the city to the Ralloses increases by about P1 million every month.

“It’s up to the city to settle its dues,” he said.

In an order dated last Sept 23, Judge Himalaloan gave the go signal for the court sheriff to issue a writ of execution against the city government.

The 9.7-hectare lot had been subjected to  auction  after Cebu City Hall refused to pay the P133 million ordered by the court as payment to the  Rallos  heirs.

The amount was for payment for the city’s expropriation of the family’s Sambag II property in 1963.

Notices of the auction have been posted on three public places. /Ador Vincent Mayol, Reporter