The government can’t seize control of the Manila-Cavite Expressway (CAVITEX) before the lapse of its concession period as that would make it liable to reimburse the expenses of contractor Cavitex Infrastructure Co. (CIC).
In a statement exclusive to Daily Tribune, the CIC said all the costs of the private concessionaire will have to be refunded if the Public Estates Authority Tollways Corp. (PEATC), a government-owned and -controlled corporation, insists on taking over the CAVITEX operations.
PEATC, a unit of the Philippine Reclamation Authority (PRA), oversees the operation, maintenance, and toll collection of CAVITEX, while CIC is the holder of PEATC’s operation and management (O&M) contract.
The CIC said the details of the obligations of the government in the event of an appropriation “is easily verifiable from a reading of the terms of agreement or a simple inquiry with the Toll Regulatory Board (TRB).”
Under the Toll Operation Agreement (TOA), ownership of the toll road structures and facilities and equipment that are all designed, financed and constructed by CIC, “will be transferred to the ROP (Republic of the Philippines) only at the end of the concession period, as is the case with other toll road PPP (Private-Public Partnership) projects.”
Franchise periods
CIC warned that any premature seizure by the government of the tollway before the end of the concession period will subject it to payment for all expenses it incurred.
PEATC spokesperson Ariel Inton claimed the Commission on Audit (CoA) wanted collections of toll fees to be turned over to PEATC with the expiration of the O&M deal.
“They wanted, at all cost to take over CAVITEX, owned by the government and Filipinos. That is also the job that the Office of the Government Corporate Counsel (OGCC) should be doing,” according to Inton.
The franchise periods of the different segments of the CAVITEX project vary, from 2033 to 2048, based on documents provided to DAILY TRIBUNE.
CIC accused PEATC of having an “ignorant misunderstanding” of the structure of the CAVITEX project.”
It said PEATC’s parent agency, the PRA, owns the reclaimed land on which the road project stands, but all other assets on the expressway were designed, financed and built by CIC and its predecessor “pursuant to a concession agreement — the Toll Operation Agreement (TOA) between the Republic of the Philippines, the PRA and CIC.”
Regarding the writ of mandamus PEATC is seeking from the Court of Appeals (CA), CIC described it as a wrong legal action.
“Mandamus is the wrong remedy to pursue, and not in the Court of Appeals because that disrespects the hierarchy of our courts,” the CIC explained.
The CIC said legally and procedurally, “a writ of mandamus cannot be availed of to enforce what is essentially a contractual dispute between the parties, i.e., the sharing of revenues under the joint venture agreement between CIC and PRA.”
It added that mandamus pertains to enforcing a ministerial duty arising from law, and “there is no law that compels CIC to turn over the O&M to PEATC, instead there is a contractual provision that Esteban and Inton are misinterpreting and twisting to suit their agenda.”
Turned over
The O&M for MCTEP has actually been turned over to PEATC, according to CIC.
PRA, its mother company, however, keeps requesting CIC to renew the “service contracts for the expressway such as the electronic toll collection, facilities maintenance, incident response, accident clearing, and towing,” the subsidiary of Metro Pacific Tollways Corp. said.
“The full operation and maintenance (O&M) of MCTEP has been turned over to PEATC since January 2022 after a Transition Committee was constituted, which thoroughly discussed the issues surrounding the turnover. Hence, PEATC cannot claim that it does not have O&M of MCTEP,” according to CIC.
In an interview, former government corporate counsel Rogelio Quevedo told DAILY TRIBUNE that the court would likely dismiss the PEATC petition for a writ of mandamus since the PEATC should have brought the matter before the OGCC for its legal representation.
Quevedo said Esteban could not accuse the OGCC of not doing anything about its case because it hired a private lawyer instead of bringing the matter before him.
Likewise, the legal fees of the private law firm would not be shouldered by the government, as stated by the Commission on Audit, precisely because the PEATC should have tapped the OGCC to represent it, Quevedo said.
Quevedo stressed the hiring of a private counsel by PEATC should have also been approved by the OGCC in accordance with established rules.