CIC exec accuses PEATC of betrayal

CIC exec accuses PEATC of betrayal | Daily Tribune

The Cavitex Infrastructure Corp. (CIC), the concessionaire of the Manila-Cavite Expressway Toll Project, is perplexed over the sudden petition of the state-owned Philippine Estates Authority Tollways Corp. (PEATC) to take over the Cavitex tollway while negotiations are ongoing, suggesting a “traitorous act” by the state firm’s head.

PEATC officer-in-charge Dioscoro Esteban Jr.’s petition with the Court of Appeals for a writ of mandamus and the hiring of a private lawyer to represent PEATC in the case surprised not only the CIC but also the Office of the Government Corporate Counsel (OGCC) that should have represented PEATC.

A CIC official said that the PEATC concerns could have been threshed out in the Project Committee level composed of PEATC parent Philippine Reclamation Authority (PRA) and CIC.

“This is pursuant to the Joint Venture Agreement. This year, we had only one Project Committee meeting where we discussed the issues raised by PEATC,” according to the DAILY TRIBUNE source.

The official said CIC had initial agreements on PEATC’s issues and “we even agreed with PRA to meet more often.”

Thus, Esteban running to the CA to seek an order for PEATC to seize the operations of Cavitex was a surprise, according to the CIC official.

“We do not understand why PEATC suddenly wrote three demand letters, ignored CIC’s hand to discuss through the Project Committee, and then filed a case before the CA. We also do not understand why PRA is now supporting PEATC based on press releases,” the official said.

The CIC source said the PRA should have taken the high ground and resolved the issue through the proper mode, which was through the Project Committee meeting.

The haphazard CA petition may not even prosper since it did not have the concurrence of the OGCC, which former Government Corporate Counsel Rogelio Quevedo said is needed for legal actions of state firms like PEATC.

Waste of public resources

The source lamented that the government’s filing of a case before the CA through private counsel was an unnecessary use of government time and public funds when the Project Committee could have discussed this.

“We had written to them several times to meet but, unfortunately, these were ignored,” the CIC source indicated.

Moreover, the matter should have been discussed prior to the filing of the mandamus petition with the OGCC as the legal counsel of GOCCs like PEATC, the source lamented.

Instead, the official said Esteban attempted to terminate the services of the OGCC and hired private lawyers to file the petition, “something that is prohibited by law (Republic Act 6000) and by issuances of the OGCC and the Office of the President.”

The OGCC reminded PEATC that its attempt to hastily terminate the state counsel’s legal services was done “without regard to its precarious effects/consequences on the cases being handled by the OGCC.”

It said that if the PEATC is not properly represented in the cases, an adverse decision or resolution will have a major financial impact not only on PEATC’s operations but also on the other government agencies which have an interest in it such as the PRA and the Toll Regulatory Board.

Ultimately, it is the government that will be put at a disadvantage if the OGCC would agree to PEATC’s unilateral termination, Quevedo said in a 19 February letter to Esteban.

Unless otherwise authorized by the President or allowed by PEATC’s head and approved by the President, or if PEATC ceases to operate as a GOCC, the OGCC shall remain as PEATC’s statutory legal counsel and primary law office, he said.

Further, the OGCC shall continue to represent and assist PEATC in all its legal concerns and affairs in all judicial, quasi-judicial, and administrative proceedings, he explained.

The relationship between government-owned and controlled corporations as clients, “like PEATC in this case, and the OGCC as counsel cannot be treated as an ordinary attorney-client relationship that is mainly fiduciary in nature that could simply be terminated upon the mutual agreement of the parties.”

It said the legal relationship is one created by law, where it imposed upon the OGCC the duty and responsibility to represent the state corporations in all proceedings before any court, quasi-judicial and administrative bodies to uphold the best interest of the government.

With such a special legal relationship, PEATC cannot summarily terminate the services of the OGCC “at its sole will,” much less by a mere letter of notice of termination, without the concurrence and authority by the Office of the President of the Philippines in the exercise of its administrative powers, the OGCC stressed.

Based on the LandBank vs Panlilio case, the mandamus case should have secured the authority and approval of the OGCC.

Otherwise, the CA will just dismiss the petition of PEATC for its failure to coordinate with the OGCC.

The Commission on Audit will not pay the legal fees charged by private lawyers to PEATC since it did not have a referral from the OGCC, Quevedo said.

He said his letter to Esteban questioning the PEATC head’s decision to secure the services of a private lawyer went unanswered.