CA says PH can’t claim ownership of Naia 3 unless it pays P16B to Piatco

The Court of Appeals building in Ermita, Manila. CONTRIBUTED PHOTO/COURT OF APPEALS WEBSITE

MANILA, Philippines—The Philippine government cannot exercise full ownership of the Ninoy Aquino International Airport Terminal III unless it pays in full the P16 billion just compensation earlier awarded to its builder, the Philippine International Air Terminals Company Inc. (Piatco), the Court of Appeals said in a ruling.

In a 21-page decision promulgated Oct. 10, the appeals court Special 13th division through Associate Justice Franchito Diamante said the Pasay City Regional Trial Court committed grave abuse of discretion in allowing the government to deposit in escrow account the amount worth US$371.43 million or P16 billion as well as the conditions for its release.

Among the conditions imposed by the Pasay RTC are:  Piatco must submit a warranty that the structures and facilities of NAIA III are free from all liens and encumbrances; Piatco must submit an undertaking that it is assuming sole responsibility for any claims from third persons arising from or relating to the design or construction of any structure or facility of Naia III structures, if any; and Piatco must submit a duly executed deed transferring the title of the Naia III structures and facilities to the government, without prejudice to the amount which will finally be awarded to it by the appellate court.

The appeals court said, the Pasay Court’s order stating that upon deposit of the P16 billion in escrow, the government can exercise full ownership of the airport is void.

“A reading of the applicable laws and jurisprudence on expropriation would show that exercise of full rights of ownership may only be made if there is a final executory judgment on the amount of just compensation and the same has fully been paid to the property owner,” the appeals court said.

In this case, the amount in escrow has to be withdrawn and paid in full to Piatco.

Ownership of Naia III was already established in a Supreme Court ruling, thus payment should be given to Piatco, as the owner.

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