The case stemmed from the construction of the Sacobia bridge by the Ciriaco Corp. which was hired by thePhilippine
National Construction Corp. (PNCC) to do it in time for the commemoration of the Philippine Independence Centennial during the term of Pres. Ramos.
The original cost of the bridge was about P153 million, but delays in payment prompted the firm to demand a higher amount of some P214 million, citing as reason the rise in dollar exchange rate amid the 1998 global economic crisis. The CDC refused to pay the increased amount.
Default
The PNCC, in behalf of Ciriaco, brought the case before the OGCC which decided on Dec. 8, 2008 in favor of the PNCC and the C iriaco firm, but only on grounds that the CDC had defaulted on the case by ignoring several hearings slated by the OGCC on the case. The OGCC verdict was affirmed by the Department of Justice on April 24, 2009 and further affirmed by the Office of the President on Jan. 5, 2010.
The CDC then appealed the case before the CA which issued its verdict last April.
CDC Vice President for Legal Affairs Pearl Sagmit said her firm has already filed disbarment proceedings before the Supreme Court against a former CDC lawyer who had failed to attend to the case.
Tejada said that in its decision last April, the CA again cited the failure of the CDC lawyer to respond to the initial hearings of the OGCC on the case as reason for junking the CDC’s appeal. CDC officials have not revealed further plans to resolve the case.
It can be recalled that in 2010, government bank depositories started to implement a notice of garnishment of some P214 million of the assets of the CDC in favor of PNCC and Ciriaco.
In a letter to the CDC, Benilda Abrasia-Tejada, executive vice president and chief legal counsel of the Development Bank of the Philippines (DBP), said her bank had no choice but to comply with the execution of the garnishment order by releasing the CDC’s bank deposits amounting to P60,752,167 in favor of PNCC “joined by Ciriaco Corp.”
The Land Bank of the Philippines (LBP) also followed by garnishing another P170, 704,469 of CDC’s deposits in favor of the same recipient. After the erring CDC lawyer resigned, the state firm had tried to seek the help of Pres. Aquino to refrain from pursuing a writ of execution of its garnishment decision, saying the exchange rate cost adjustment had “no legal basis or provision” in the contract between the PNCC and the CDC.
The CDC also insisted that the OGCC “does not have jurisdiction to arbitrate under Presidential Decree No. 242” and that this authority belonged to the Construction Industry Arbitration Commission under Executive Order No. 1008.
The CDC also maintained that “PD 242 has been used by PNCC to cleverly camouflage private interest of Ciriaco and unwittingly use the OGCC as forum for arbitration in order to collect for and on behalf of Ciriaco.”
The President, however, did not intervene.
