Firms’ bid to stop purchase of new train cars nixed

INQUIRER FILE PHOTO

MANILA, Philippines–The Court of Appeals has denied a petition filed by the operator of the Metro Rail Transit Line 3 (MRT-3) seeking to stop the Department of Transportation and Communications (DOTC) from buying new train cars from a Chinese firm.

In a resolution issued on July 31, the court’s 16th Division denied the petition for a temporary restraining order and injunction sought by MRT Holdings II Inc.—owner of train operator MRT Corp.—as it said the two companies would suffer no grave or irreparable injury as a result.

In June last year, the DOTC awarded to Chinese firm CNR Dalian Locomotive & Rolling Stock Co. Ltd. in a public auction a P3.8-billion contract for the manufacture and supply of 48 new light rail vehicles (LRVs). According to transport officials, this would help address the shortage of train coaches at the MRT-3 whose ridership has swelled to over 500,000 a day, far above its capacity of 350,000 passengers.

The move, however, was protested by MRT Holdings and MRT Corp., which filed an injunction case dismissed by a Makati court earlier this year.

In its ruling, the appellate court cited Republic Act No. 8975 which prohibits lower courts from stopping the implementation of government infrastructure projects.

“It is clear that the project concerning the procurement, supply and delivery of LRVs partakes of a national government infrastructure project geared toward the paramount objective of [addressing] the pitiful condition of our commuters. Thus, we find no compelling reason for the issuance of the injunctive relief prayed for,” the appellate court said in the decision written by Justice Ma. Elisa Sempio Diy.

The other division members, Justices Ramon Bato Jr. and Rodil Zalameda, concurred in the ruling.

The court described as a “bare allegation” the two companies’ claim that they would suffer irreparable injury as a result of the awarding of the contract, adding that any damage would be “quantifiable” and if proven, would be “fully compensable” as damages.

The MRT Holdings II filed the injunction case against DOTC last year, saying it had to protect its rights under a build-lease-transfer agreement. It added that the awarding of the contract for the purchase of new LRVs was done without its consent and in violation of its right of first refusal.

The Department of Justice, however, in an opinion issued in January this year declared MRT Corp.’s right of first refusal void.