In 20-yr case, SC OKs Baguio market deal

BAGUIO CITY—After 20 years of litigation, the Supreme Court has allowed debt-ridden Uniwide Sales Realty and Resources Corp. to replace the Baguio City public market with a commercial building it would operate for 30 years.

The high court, in a Sept. 2 notice, affirmed a Court of Appeals (CA) ruling that Uniwide’s 1995 contract to develop the city’s public market was valid. It resolves the lawsuit filed against Uniwide and Baguio officials by Baguio market vendors.

But Mayor Mauricio Domogan said the city government needs to determine the feasibility of Uniwide’s plans because its original proposal has become outdated.

Domogan also served as city mayor when Uniwide won the original lease contract in the early 1990s.

In a news conference on Wednesday, Domogan said the government needs to verify if Uniwide intends to proceed with the contract given the delays because of the lawsuit.

“We have to know directly from them [as to what decision they would make regarding their contract],” he said.

In a statement, however, Vice Mayor Edison Bilog said the council can withdraw the market deal, arguing that Uniwide had been dissolved by the Securities and Exchange Commission (SEC).

Bilog said the SEC, in an en banc decision dated May 30, 2013, ordered the dissolution of all the companies in the group. These are the Uniwide Sales Inc., Uniwide Holdings Inc., Naic Resources and Development Corp., Uniwide Sales Realty and Resources Corp., First Paragon Corp. and Uniwide Sales Warehouse Club Inc.

He said the dissolution was pursuant to section 6-1 of the SEC Rules of Procedure on Corporate Recovery “due to financial hemorrhage since 1999, with sales and total revenues steadily declining resulting to huge annual losses in its operations from 2002 to 2009 consequently having been denied corporate rehabilitation in 2010.”

The Inquirer ran a story about Uniwide’s dissolution on June 20, 2013.

Except for an emissary he did not name, Domogan said the city government has yet to hear directly from Uniwide.

Four groups of vendors had originally questioned the use of a design-build-lease (DBL) arrangement to raise a commercial complex, saying it was not a feature of what was then the Build-Operate-Transfer (BOT) Law (Republic Act No. 6957).

The BOT law, which had undergone amendments, was the precursor of what is now government’s public-private partnership arrangements.

In its three-page notice, the Supreme Court said the CA was correct when it concluded in its Dec. 28, 2012 decision that the DBL agreement followed the rules of the BOT law.

“If Uniwide decides to proceed with the project, a lot of things need to be done. The project was estimated to cost up to P1.7 billion back in 1992 and 1993. That project could now require P12 billion in financing. [Uniwide] would have to [evaluate the costs] again,” Domogan said.

A new plan, he said, needs to be submitted to the city council for approval. Vincent Cabreza and Jessica Tabilin, Inquirer Northern Luzon