John Hay home owners victims of feud, too

BAGUIO CITY—There is another fallout from an arbitration ruling that settled the public dispute over Camp John Hay’s development: Companies and residents who put up businesses or bought housing there may have lost their right to stay in the former American rest and recreation reservation.

Lawyer Peter Paul Flores, general counsel of the Bases Conversion and Development Authority (BCDA), met Camp John Hay locators and homeowners on Thursday to discuss their legal options.

They said the government believed their contracts were voided by the Feb. 12 decision of the Philippine Dispute Resolution Center Inc. (PDRCI). The decision concluded that both BCDA and the Camp John Hay Development Corp. (CJHDevco) violated the 1996 lease to convert Camp John Hay into a tourism estate.

The PDRC directed the developer, a firm owned by businessman Robert John Sobrepeña, to vacate the property while ordering BCDA to reimburse its rent amounting to P1.42 billion.

Because of the mutual breaches of their agreements, PDRCI “extinguished” the agreement and “reverted [all John Hay transactions] as far as practicable to their original position prior to the execution of the original lease agreement.”

Flores said this decision meant that the sub-leases attached to the original lease were also extinguished, leaving “high and dry” some of John Hay’s locators, and private homeowners who bought hotel rooms and lodging facilities, or built their own houses.

But government does not want to be in a situation where it would eject all John Hay locators and homeowners, he said.

Lawyer Richard Cariño, counsel of a major locator at Camp John Hay, said his client intends to go to court, along with other John Hay stakeholders, to protect their rights.

A city councilor, Cariño said John Hay businesses and homeowners may also lay claim over the P1.42 billion that BCDA is required to give back to CJHDevco.

Sobrepeña, in a Feb. 16 news conference, said BCDA must honor the sub-contracts, saying the agency endorsed these agreements. To abandon these contracts would open the government, or CJHDevco, to lawsuits, he warned.

Flores said the PDRCI ruling gave the government little legal room to maneuver because of how the decision was phrased.

For example, the tribunal said CJHDevco must vacate Camp John Hay “and promptly deliver the leased property, inclusive of all new constructions and permanent improvements introduced during the term of the lease as reckoned from the execution of the original lease agreement, to [BCDA] in good and tenantable condition in all respects, reasonable wear and tear excepted,” he said.

Flores said the word “tenantable” indicated that the property must be returned without the encumbrances of sub-contracts and other property agreements to enable the BCDA to sell these properties when it proceeds to operate Camp John Hay.

“This means the property must be returned without any occupants,” he said.

When asked, Flores told the Inquirer that renegotiating these contracts would also be a problem because government auditors would require the buyers to again pay for the properties.