SM Prime sues ALI, Negros Occidental officials

BACOLOD CITY—SM Prime Holdings Inc. (SMPHI) has sued Negros Occidental provincial government officials and Ayala Land Inc. in a bid to stop the sale and lease of the Capitol’s 7.7-hectare  prime property here.

Named a defendant in the civil case filed last May in the Regional Trial Court Branch 48 in Bacolod City was Gov. Alfredo Marañon Jr., in his capacity as governor and chair of the Committee on Awards and Disposal of Real Properties.

Also sued were the committee members, Provincial Board members and ALI.

The court has directed the defendants to file their answer to the complaint within 15 days from receipt of their summons.

Marañon, for his part, said the new civil case filed by SMPHI in Branch 48 covered the same issue that had been dismissed by another court.

The SMPHI earlier filed a petition asking the court to nullify the committee resolution that declared the July 7, 2011 bidding a failure and instead name SMPHI  the winning bidder.

But Judge Estefanio Libutan Jr. of RTC Bacolod Branch 50  denied the petition  against Marañon and committee members for lack of merit. The petition had been elevated before the Court of Appeals.

In a statement, Emilio Tumbocon, Ayala Land Group Head for Visayas and Mindanao, said ALI  was prepared to address the issues raised in court.

“We are confident that the Bacolod Capitol transaction was made in compliance with applicable laws and rules and regulations,” he said.

In its new civil case, SMPHI asked the court to declare null and void the deed of conditional sale and contract of lease  between the province and ALI.

SMPHI claimed that the province circumvented the law when it executed the deed of conditional sale and contract of lease in favor of ALI.

It said SMPHI expressed interest in leasing the Capitol property, in a letter dated April 8, 2011, and submitted an unsolicited proposal  to the governor  for the construction of a world-class business and technology park, worth P2 billion, at the site.

Marañon did not act on the proposal but instead issued an offer to sell or lease the property in June 2011.

Bidding was held despite SMPHI’s appeal to cancel. The province decided, however, to hold another bidding because only ALI submitted an offer.

SMPHI and ALI joined the next bidding but the Capitol declared yet another failure as both firms’ bids came in below the floor price of P19,500 per square meter.

SMPHI rejected the declaration  of failure of bidding, saying it should be declared the winning bidder since its bid was better than ALI’s.

But the Capitol went ahead with a negotiated  sale and lease of the property  on July 15, 2011. The property was awarded to ALI.

SMPHI claimed that the committee had predetermined that the contract would go to ALI.

“Knowing full well that the disposition of the properties  through negotiated sale could only be done after a failure of public bidding,  Marañon and the Committee devised a ploy  to make it appear that  that procedure had been followed,”  SMPHI added.

As such, it said the negotiated sale between the province and ALI could not be held valid while serious flaws in the bidding process were being questioned.