April 26, 2018, 7:30 pm
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‘I calls ’em as I sees ’em’

Terminal 3 mess, or fighting Piatco


No other subject took up Jake Macasaet’s energies than the battle waged on Naia terminal 3, or the  Piatco mess.

He wrote on the subject for seven  years, starting from 2010. But before this, he had raised doubts on the project, particularly on its ownership. 

In “Terminal 3 up for grabs” which he wrote about on March 29, 2010, he said:

THE Arroyo administration is thinking of selling the incomplete Terminal III for $600 million. At the same time, Fraport, the German partner of Philippine International Air Transport Corp. (Piatco) is also reportedly selling its stake for a rumored $150 million.

At least one Chinese-Filipino businessman has expressed interest to buy Fraport’s stake but a source said a large universal bank declined to grant him a loan to help finance the purchase.

Terminal III of the Ninoy Aquino International Airport was started during the Ramos administration after the Asian Emerging Dragon Corp. (AEDC) composed of five taipans  made an unsolicited bid for around $300 or so million.

The unsolicited bid was challenged by Piatco which offered about $350 million as cost of construction.

AEDC wanted to match or improve the challenge but Piatco refused to reveal its terms forcing the taipans to go to court. However, powerful politicians intervened and got the members of the consortium to agree to settle out of court.

Eventually, the government awarded the contract to Piatco which by that time had already convinced Fraport of Germany to be its foreign partner.

On September 11, 2015, he said:

To us non-lawyers, the en banc ruling of the Supreme Court awarding Philippine International Air Transport Corp. (PIATCO) $326 million in just compensation is rewarding fraud. But the issue resolved by the Tribunal has nothing to do whatsoever with alleged fraud PIATCO might have committed.

The issue is just compensation for the government’s act of expropriating the assets of the company which had a joint venture agreement with Fraport, a German firm. It is not funny at all the State had to pay for its own mistake of appropriating the assets over the objection of former SC Associate Justice Florentino P. Feliciano and his assistant Maria Lourdes P.A. Sereno, now Chief Justice. 

The two brilliant lawyers were private counsel of the government.

But since the Solicitor General is always lead counsel in any dispute involving the interest of government, he had assets of PIATCO arbitrarily expropriated, probably not knowing or never forgetting a claim for just compensation may be filed by the company precisely because of the expropriation.

The expropriation practically gives meat to the old saying “what you sow is what you reap.”

The en banc voting was unanimous at 10-0 in a 15-man court. Five members did not participate. Justice Bodji Reyes is on leave. The Chief Justice and three other magistrates – Justice Carpio, Jardeleza and Castillo did not participate for reasons they did not have to explain to anybody.

The Chief Justice did not participate because she objected to the expropriation during the hearing of the arbitration case filed by Fraport with the International Center for Settlement of Investment Disputes, an arm of the World Bank, in Washington DC. She could have dissented, but she did not again for reasons she has no duty to explain to anybody.

The ruling is unanimous among 10 magistrates, again not including the Chief Justice.

I will remind anyone who wants to know the background of the construction of Terminal III, not the expropriation, the PIATCO had troubles from Day One. The Asian Emerging Dragons Corp. organized by the country’s biggest taipans made an unsolicited offer to construct the new terminal.

The offer was challenged by PIATCO. Unbelievably, PIATCO refused to reveal the terms of its challenge. A complaint was filed by the taipans with a regional trial court to force PIATCO to reveal its terms. Somehow or other, some powerful people in the administration of President Estrada intervened. The result was an amicable settlement which effectively meant AEDC backed out of its complaint.

The project went on. Not much later, the “amended and reinstated concession contract” that bloated the cost took effect without the approval of the investment committee of the National Economic and Development Authority. Then NEDA director general Felipe Medalla is alive and well to swear to the fact he did not approve the amended concession contract.

There is a host of events not related to just compensation but they did not create for Cheng Yong, chairman of PIATCO, a healthy respect for the ways he conducts his business.

It would be recalled Fraport, the German partner of PIATCO, filed an arbitration case with the ICSID claiming the Philippine government violated a bilateral agreement with Germany. Strangely, the late famous lawyer Reynaldo Siguion-Reyna admitted before the arbitration court that by cascade Fraport ended by owning slightly more than 60 percent of Terminal III, a public utility. 

Nobody ever raised the question of Fraport violating the constitutional limit of 40 percent equity in public utilities.

The equity of Fraport went up beyond the limits allowed by the Constitution after the companies which are stockholders of PIATCO and presumed to be owned by Cheng Yong sold their shares to the German company. The Arroyo government failed or refused to notice what appeared to be a direct violation of the Constitution.
 
 Assorted ‘enemies’

DURING his hey-day in power, Mike Arroyo, more out of pique than anything,   filed libel   suits left and right against his perceived critics. One of these targets was Jake.

Along with the other accused, he patiently attended hearings (and paying lawyers’ fees, including those of his co-accused from Malaya Business Insight). Then, out of the blue, Mike with purported magnanimity, announced he was dropping all the libel cases. Jake didn’t want to accept this, and he said so in no uncertain terms. He wanted the cases decided on their merits.  

The court, faced with the refusal of lawyers to pursue the cases, had no choice but to dismiss the cases,  which was what Arroyo wanted. But in dismissing the cases, the court in effect, ruled on the merits of the cases. Which was what Jake sought in the first place.
 
Weekend farming

IN the late Eighties, Jake and Karen finally came into possession of a rather sizable piece of land. First, he built his idea of a dream house, complete with swimming pool.

Then he turned to his one true love: farming. He never tired of saying that once upon a time, he and his father tilled the land, growing what they ate, and selling the excess of their produce so he and his siblings could go to school.

But with his new responsibilities in his later ears APM had to be content with weekend farming: Work in Manila Monday to Thursday, and spend Friday to Sunday in his Batangas farm. But it was no longer with “heavy” crops like rice, but with therapeutic or “relaxing” products like lanzones. He imported seeds from  Thailand and saw the fruit multiply.  The beneficiaries were his Malaya co-workers who looked forward to the yearly bonanza.
 
And farmer-friends 

Topping this list was Mao Chanco, whom Jake unabashedly admired for his expertise and dedication not only to his   craft but also for preaching the love of  farming. Mao had a lot in Antipolo and it was a matter of envy to Jake Nao could well indulge in his avocation without too much trouble.
 
Of cockpits and cockers

JAKE Macasaet was hardly your cockpit heavy-playing aficionado. Where other players would hardly think twice over making a P50,000 bet, the most Jake would place on a fighting cock was P5,000 and only if the rooster was owned, raised and trained by him. Otherwise, he was satisfied to breed fighting cocks, taking advantage of his trips to the US to bring in eggs ready to be hatched.

Now comes Jun Santiago. One of the close friends of Jake on the cockpit circuit was Jun Santiago, husband of Miriam. But they had a falling out over Jun’s interpretation of the rules on weight which Jake felt Jun was trying to fix in his favor. Jake wrote strongly about this, and Jun sued for libel. Until the end, there was no closure to the case, inspite of a court-ordered mediation.
 
Karen and Monica

JAKE’S wife, Karen, encouraged her grandchildren, particularly Monica, to develop the habit of reading, and for this reason took out supplementary credit cards. One day, Monica told her grandmother that a book firm refused to honor her credit card. Jake did his own fact-checking and was convinced his granddaughter had a case. And he wrote about it. Result: The credit card firm realized its mistake, and offered by way of apology to stock the school library of Monica’s choice with P50,000 worth of books.
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