Status quo order issued vs eviction of John Hay Corp., investors

THE Court of Appeals has issued a status quo order preventing the Bases Conversion and Development Authority (BCDA) from evicting Camp John Hay Development Corporation (CJHDEVCO) and the more than 1,600 third-party investors from a former military turned recreation in Baguio City.

During Thursday’s hearing, Associate Justice Noel Tijam, chairman of the appeals court’s Special Fifth Division, said they would rather issue the status quo order instead of an injunction because they will decide on the merits of the case not later than the end of the month.

Tijam enjoined the parties to maintain a status quo once the 60-day temporary restraining order (TRO) it issued on May 19, 2015 expires on July 19, 2015.

“One of the members of the division is not here and will not be back until July 22nd . . . If you will agree to maintain the status quo to give us the opportunity to decide on the merits of the case . . . with the assurance that before the end of the month, the Court will decide on the merit. It’s a matter of waiting until end of July,” Tijam told the lawyers of all parties.

All parties agreed but with a condition from BCDA that all transactions of CJHDEVCO during the period will be audited.

CJHDEVCO lawyer Gilbert Reyes said his client is willing to wait until end of July and agreed on the conduct of accounting of its transactions during the period.

According to Atty. Reyes, the plea for writ of preliminary injunction has been deemed moot and academic by the agreement by all parties concerned to respect the status quo order pending final resolution of the case on the merit.

“Upon the initiative of the Court, we agreed to respect and observe the status quo order. Meaning, the writ of execution and notice to vacate won’t be implemented when the 60-day TRO expires on July 19. We will just wait for the Court judgment on the merit of the case, which we expect to be rendered by end of this month,” Reyes said, in an interview.

Meanwhile, Tijam also announced that appellate court has decided to admit the petition-for-intervention filed by 52 property owners inside Camp John Hay seeking to compel the BCDA to respect their 50-year leasehold agreement with CJHDEVCO.

The appeals court earlier allowed Camp John Hay Golf Club, which occupies 20 percent or 48.43 hectares of the leased area at Camp John Hay with more than 800 members, to intervene in CJHDEVCO’s petition.

Lawyer Howard Calleja who represents the property argued that BCDA cannot forced third party investors to abandon its contract with CJHDEVCO and renegotiate the same with BCDA in order to avoid eviction.

Calleja branded as “oppressive” the BCDA’s threat of eviction against the third party investors who will not heed its demand for renegotiation.

“Being a government property will they renegotiate without bidding? I don’t think it’s possible,” Calleja said in response to BCDA legal counsel Demetrio Custodio’s claim that some of the sub lessees are in talks with the agency for possible renegotiation of their contracts.

Calleja noted that BCDA through CJHDEVCO “invited” and “seduced” them to enter into a leasehold agreement until 2046, thus, he said being investors in good faith their contract should be accorded with respect.

Calleja insisted that third parties cannot be considered as sub lessees, thus, even with the rescission of the lease agreement between BCDA and CJHDEVCO, the BCDA still has a direct obligation to respect the right of third parties.

On May 12, 2015, CJHDEVCO filed a petition for certiorari and prohibition with urgent applications for the issuance of a TRO and/or a writ of preliminary injunction against the implementation of the writ of execution dated April14, 2015 and the notice to vacate dated April 20, 2015 issued by the Baguio RTC.

Prior to this, the arbitral tribunal rendered the final award, rescinding the subject lease agreement due to mutual breach of the parties.

In the said final award, petitioner was ordered to vacate the leased property and to promptly deliver the same to BCDA.

On the other hand, the BCDA was also ordered to return to petitioner the amount of P1,421,096,052 as advance rentals paid by the latter.

On March 6, 2015, CJHDEVCO filed its verified petition for confirmation of final award before the Baguio RTC, which the latter confirmed in toto.

During the pre-execution conference, the parties manifested conflicting positions as to the effect of the final award on the third parties occupying the leased property but the Baguio RTC declined to rule on the effect of it on the third parties.

The BCDA, however, included the third parties in the implementation of the notice to vacate, prompting the CJHDEVCO to seek redress from the appeals court.