MANILA, Philippines - The Court of Appeals (CA) has affirmed its earlier ruling awarding to Shoemart Inc. (SM) ownership of a 19-square kilometer land in the Central Business Park (CBP) in Pasay City.
In a two-page resolution issued last week, the CA’s 13th division dismissed the motion for reconsideration filed by the Philippine Estates Authority (PEA) contesting its order last Feb. 27 for the transfer of ownership of the 19,274-square meter lot covering Island A of the CBP 1 pursuant to the joint venture agreement (JVA) signed by the government with SM in 1994 for the development of the property.
Associate Justices Isaias Dicdican and Nina Antonio-Valenzuela concurred in the decision penned by Associate Justice Michael Elbinias.
Under the JVA, the PEA shall be responsible for the relocation of squatters that may be found on the development site while SM shall assist PEA in the relocation of squatters and advance the funds for the undertaking.
The advance amount by SM for the relocation of squatters shall be paid by PEA with land located at CBP-1 Island A based on the appraisal value at the time of drawdown.
On June 29, 1995, SM and PEA entered into a deed of undertaking to relocate squatters at CBP-1 Island A, for which SM agreed to release P85 million.
On Nov. 10, 1999, PEA advised SM that at the time of drawdown, the appraisal value of land at CBP-1 Island A was P4,410 per square meter, thus, the P85 million advanced by SM is equivalent in land area of 19,274 square meters.
SM identified a particular area at CBP-1 Island A located at Block D, with an area of 19,274 square meters as repayment of the P85 million.
SM’s Henry Sy Jr., however, filed a “complaint for specific performance†against PEA in 2005 due to PEA’s failure to convey the property despite SM’s full payment of the advance amount.
PEA argued that “it is deemed prudent†to seek first the guidance of the Commission on Audit on whether it is in order to use the appraisal value of the land at the time of the drawdown in computing the area to be paid to SM at the present time considering the length of time that elapsed before the parties could agree on the site to be conveyed.
In its assailed February decision, the CA dismissed the argument of PEA since JVA and the deed of undertaking it executed with SM showed that the valuation of the land was to be based at the time of the drawdown.
“If the parties wanted the valuation of the land to be that as of the time that plaintiff- appellee Sy made the choice, and not at the time of drawdown, then such contracts – deed of undertaking, agreement and JVA – would have stated so,†it said.
The CA noted that even the PEA, through its then general manager Carlos Doble, confirmed the value of the land at the time of the drawdown to be at P4,410 per square meter, which was equivalent to 19,274 square meters.