BCDA welcomes SC decision on John Hay SEZ

Following the order of the Supreme Court (SC) to uphold the arbitral ruling ordering Camp John Hay Development Corporation (CJH DevCo) to vacate part of the John Hay Special Economic Zone (John Hay SEZ) leased from the Bases Conversion Development Authority (BCDA), the BCDA said they welcome the highest court decision as it will benefit the Philippine government.

"We at the Bases Conversion and Development Authority (BCDA) and the John Hay Management Corporation (JHMC) welcome the Supreme Court decision on the legal dispute with CJH Development Corp., allowing the BCDA and JHMC to recover the 247-hectare property in John Hay Special Economic Zone and utilize it for the full interest and benefit of the government and the Filipino people," the BCDA said on Thursday.

Based on the 3 April decision of SC Associate Justice Japar B. Dimaampao, the SC En Banc granted the petition for review on certiorari filed by the BCDA assailing the ruling of the Court of Appeals (CA) which had reversed the Regional Trial Court (RTC) confirmation of the arbitral ruling.

Further, Dimaampao's decision also denied the petition for certiorari filed by CJH DevCo challenging the rulings of the Commission on Audit (COA) for dismissing CJH DevC's money claim arising from the arbitral ruling.

Following the transformation of Camp John Hay into the 625-hectare John Hay SEZ, the lease and development of a 247-hectare portion within the SEZ was awarded to CJH DevCo.

BCDA, as lessor, then entered into a lease agreement with CJH DevCo, Fil-Estate Management Inc., and Penta Capital Investment Corporation, as lessees, for the use, management, and operation of the leased property.

Under the lease agreement, the BCDA remains the owner of the leased property, with CJH DevCo owning its introduced improvements.

However, at the end of the lease agreement, CJH DevCo is obligated to transfer ownership of the improvements to BCDA.

CJH DevCo was also authorized under the agreement to sublease the leased property to third persons.

Prompted by disputes as to the parties' respective obligations under the lease agreement, CJH DevCo filed against BCDA a complaint in arbitration with the Philippine Dispute Resolution Center Inc. (PDRCI).