IN THE RIGHT. Atty. Karen Jimeno presents side of GGDC versus Peregrine. Photo by Bong Lacson
CLARK FREEPORT – The termination of the contract of the developer of the 177-hectare Sabah Al Ahmad – Global Gateways Logistics City (GGLC) project here is valid.
This was the statement made by Atty. Karen Jimeno, legal counsel of KGL Investments’ (KGL) Global Gateways Development Corp. (GGDC) which holds the lease to the project where The Medical City- Clark is located from the Clark International Airport Corp. (CIAC).
Jimeno, guesting at the media forum “Balitaan” organized by the Capampangan In Media, Inc. in cooperation with the Clark Development Corp. and the Social Security System at the Bale Balita here last Friday, said Peregrine Development International has committed various offenses in the Engineering Procurement Construction Management (EPCM) contract which led to its unilateral cancellation.
Jimeno said GGDC has discovered that Peregrine “is not following proper bidding procedures for hiring sub-contractors” and allegedly conduct “under the table deals” as well as “favoring some contractors.” Jimeno also said GGDC discovered that Peregrine was drawing funds from the Working Capital Account (WCA) for other projects other than the GGLC project.
“It was also discovered that Peregrine has a broad expense for PR (public relations),” she added. But Jimeno said even if these breaches require six-month notice under the EPCM contract, another provision specifically states that if there is a change of ownership, the EPCM contract is automatically cancelled.
“There is a provision in the EPCM contract that does not require a six-month notice,” said Jimeno. “Basta nagka change ng ownership ite-terminate ang contract (If there is a change of ownership the contract is terminated) and that’s because it also respects the new owner in terms of choosing to whom they are comfortable,” she added.Jimeno explained that the investor in the project which is the GGDC has found another investor which automatically cancels the EPCM contract.
She, however, have yet to name the new investor. “There was a valid termination of the contract,” she stressed.
However, Jimeno said the procedure is subject for arbitration in Singapore as agreed by both parties. “But Peregrine aside from arbitration also filed a case with the RTC,” Jimeno said. “In the meantime, because there was already, based on the contract, a ground for unilaterally terminating it, then GGDC has the right to continue with the project.”
“In any case, if the contract termination with Peregrine is illegal, then Peregrine will be awarded damages or if GGDC loses the Singapore arbitration,” said Jimeno. “If Peregrine’s case is meritorious, they should not worry with getting an unfavorable result from the Singapore arbitration,” she reasoned.
Meanwhile, Jimeno said the Court of Appeals (CA) has granted GGDC’s petition for certiorari which asks for the voiding or nullity of the RTC decision. “We have a TRO from the CA. The RTC decision was invalidated by the CA,” she said.
“And yet they (Peregrine) refuse to respect and decision of the CA,” Jimeno said. “I understand that Mr. Wright has an emotional attachment to the project but he should follow the law,” she added. Jimeno explained that under our laws, the Singapore arbitration should prevail over local courts because the parties themselves agreed to that.
“It is a mode of settling the dispute as stipulated in RA 9285 or the Alternative Dispute Resolution Act,” she said.
