Razon’s South Cotabato power modernization clear legal hurdle
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A regional trial court has dismissed a petition challenging South Cotabato Electric Cooperative II's (SOCOTECO II) decision to conditionally accept Ignite Power Inc.'s modernization proposal, removing a legal obstacle to the Razon-led firm's bid to partner with the electric cooperative.
The ruling allows SOCOTECO IIto proceed with its modernization process after it rejected a competing unsolicited proposal from Manila Electric Co. (Meralco). Any joint venture with Ignite Power, however, remains subject to approval by the cooperative's member-consumer-owners.
In a six-page decision dated June 5, Regional Trial Court Branch 62 Assisting Judge Vicente Andiano ruled that petitioner Rogelio Garcia failed to establish a sufficient cause of action and "miserably failed" to show that he had exhausted available administrative remedies before seeking judicial intervention.
"It is elementary that disputes involving intracorporate affairs between the board of directors (and) the members of a private electric cooperative (are) within the primary and exclusive jurisdiction of the National Electrification Administration (NEA)," the court said, citing Presidential Decree No. 269.
The court added that Garcia's suit was premature because he did not first bring his grievances before the NEA, the agency with primary jurisdiction over disputes involving electric cooperatives.
Garcia had sought to nullify and stop the implementation of SOCOTECO II Board Resolutions 19, 20 and 28 November.
Under those resolutions, the cooperative's board rejected Meralco's unsolicited joint venture proposal as "not acceptable," citing several inconsistencies, including its corporatization model, which the board said was incompatible with SOCOTECO II's member-owned structure.
The same resolutions, later endorsed by the NEA in March, conditionally accepted Ignite Power's modernization proposal for the cooperative, which serves consumers in General Santos City, Polomolok, parts of South Cotabato, and Sarangani province.
The court likewise rejected Garcia's argument that seeking relief from the NEA would have been futile because the agency had allegedly connived with the cooperative's board.
"Such claims of connivance are without basis in fact and in law, and thus, plaintiff cannot be allowed to disregard the NEA's primary and exclusive jurisdiction over disputes of this nature," the decision said.
Despite the favorable ruling, Ignite Power said the modernization process has yet to reach the negotiation stage.
Legal officer Allana Mae Babayen-on said the company has not entered into final negotiations with SOCOTECO II and stressed that any joint venture agreement would still need the approval of the cooperative's member-consumer-owners through a vote.
Ignite Power, a unit of Primelectric Holdings Inc., has said it aims to replicate the operational improvements it implemented at Central Negros Electric Cooperative to enhance the reliability and efficiency of power distribution in parts of Mindanao.
