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Just this June of the last year of 2014, the Pasay City Regional Trial Court has just cleared Camp John Hay Development Corporation Chair and CEO Robert Sobrepeña of estafa case as was filed by the Department of Justice (DOJ).

The issue arose as a result of Bases Conversion Development Authority (BCDA) accusingRobert Sobrepeñaof failing to comply with his rental payments for two years within the year 1998 - 2000 amounting to 1.5 Billion pesos of owed payment.

According to a December 19 seven-page order which the Department of Justice received early this week, Pedro Gutierrez, Pasay RTC Branch 119 Judge, denied the motion to reconsider the finality of the case as filed by the government prosecutors on behalf of Bases Conversion Development Authority which had sued Sobrepeñaby failing to fulfill an obligation on the lease agreement he signed.

The Lease Agreement

Following the terms of the 1996 lease agreement between Camp John Hay Development Corporation (CJHDevCo)and BCDA, CJHDevCowas supposed to pay an annual rent of 425 million pesos or 5% of the gross revenues during the first five years of the lease, whichever pays more. This means that within the years of 1998, 1999, and 2000, CJHDevCoowed the government a rental payment amounting to 1.275 Billion pesos.

According to Sobrepeña, CJHDevCo’s operations were adversely affected in 1998 which results to losses of about 1.445 Billion pesos which continued to increase on a daily basis.Due to this reason, the agreement was restructured in the year 2000.

However, CJHDevCo also disclosed that within the years 1998, 1999, and 2000, the company declared a dividends which totals 928 millions.

For this, the DOJ pointed out, “CJHDevCo deliberately chose not to perform its rental obligations to BCDA despite knowledge of such and existence of retained earnings and other revenue.”
Based on the 1998 financial statements, the DOJ also pointed out, “CJHDevCo could have very well met its rental obligation of P425,001,378 million had it chosen to do so as seen by its acts of disposing P674,065,290 by way of dividends ….”

The Reason for the Verdict

Uphelding the judge’s September 3 ruling, Arnel Casanova, BCDA President, miscarried to bring about probable cause in Sobrepeñabeing accused by misconstruing the company’s ability to pay for Camp John Hay’s rent.

In its order, the court said, “BCDA agreed to restructure the debt under the lease agreement. The accused (Sobrepeña) cannot be held liable for CJHDevCo’s failure to pay those rentals.”

The decision for the verdict was apparently also pointed out as a result of DOJ’s “palpable error of selective prosecution”by singling out Sobrepeña in the case and excluding other members of the board of directors of CJHDevCo as stated by the judge.

In the end, the judge ruled out the case with this ending statement, “If there was misrepresentation as to the financial condition of CJHDevCo, the officers/directors of BCDA who are members of the committee might have been remiss, if not fell short, of their duty to determine the financial capacity or incapacity of CJHDevCo to pay its obligations.”